What is federalism?
Ask a Brit, and the answer will probably feature the words ‘European superstate’. Ask a Belgian or a German, and the answer will be very different.
The diversity of views on federalism in the European Union has made it a toxic word in the integration debate. Now, the euro crisis means that federalism is back in vogue – albeit less as an ideological goal, and more as a functional way to deal with the current situation.
The truth is that Europe has always been a functional and incomplete federation, with powers pooled together under the authority of common institutions to deal with common problems. The need to ensure fair agricultural markets – which were then heavily subsidised by nation states – led to the Common Agricultural Policy. The need to deal with cross-border environmental threats led to EU powers in environment policy.
The EU is also an odd federation. The decisions on competence (what the German language, in its inimitable style, calls ‘Kompetenz-Kompetenz’) are made by the nation states and ‘handed up’ to the EU.
Until now, the transfer of powers has been a one-way street. This has led to an incorrect equation in the UK that federalism equals a superstate, whereas the reality in many federations – Germany, Belgium, the United States – is that power is decentralised.
Now that two-way federalism may be on its way to the EU. William Hague, the British foreign secretary, has launched a consultation on the ‘Balance of Competences between the United Kingdom and the European Union’, which despite its slightly parochial title, could be a useful contribution to the debate on decentralising power in the EU (something that it already a principle of the EU under ‘subsidiarity’).
Instinct tells me that I should instantly dislike this initiative. Hague is Conservative and a Eurosceptic. The background to the paper is demands from Tory MPs to ‘repatriate’ powers from the EU. The context focuses too much on the narrow British ‘national interest’.
And yet I find myself agreeing with Hague that this could be a “valuable aid for policy makers in the future”. While the Westerwelle Group has its own ideas, this very British approach to thinking about the future of the EU may actually be more realistic than the work of the other foreign ministers. And a serious look at the EU’s powers may also be a useful way of evaluating the effectiveness of the EU, as well as building greater trust in the EU and giving it greater legitimacy.
Policy challenges change, and every federal system needs to review periodically where power lies in order to maintain the trust of citizens and ensure that government is efficient and effective. The EU made a start in the Lisbon Treaty (and in the constitutional treaty before that) by defining the EU’s competences as ‘exclusive’, ‘shared’ or ‘supporting’. However, that was both recognition of the status quo and a very broad brush approach. For example, energy policy may be a shared competence, but how is it shared? Also, where do the boundaries lie?
‘Spillover’ of powers from one area to another has been a useful concept in the past for ‘constructing Europe’: as the Hague paper points out, much of the EU’s environment policy was based on single market powers, before it was formalised in the Single European Act of 1986 and strengthened in subsequent treaties. Anti-discrimination rules followed a similar logic.
These powers are best left at EU level. Issues such as data protection are also logically handled at a European level (or even globally). However, there may also be competences that should move to a national, regional or local level. These do not need to be ‘macro’ competences – although some Conservatives would wish to end the CAP and the Common Fisheries Policy – but may be some individual elements of social policy, for example, which could be better managed at a national, regional or local level.
This should not be seen as a threat to Europe, but an opportunity to manage public policy more effectively: if the EU is not the most appropriate body to manage an issue, it will not do so effectively, and will lose trust and legitimacy – not commodities that the European institutions have in abundance.
In short, if this audit is what the paper sets it up to be – detailed, serious, and consultative – and not what many Tory MPs want it to be – a chance to bring down much of the EU brick-by-brick – then it should be welcomed.
Of course, the source of the audit may make it difficult to sell its findings to pro-Europeans and to other member states, who may fear treaty renegotiation or see this purely as British mischief-making.
Nevertheless, I think that pro-Europeans should engage in this debate, not run away from it. The audit provides an opportunity to show the value of European cooperation and integration. It is also a chance to give legitimacy to EU powers: instead of blindly following the path of integration, we stop to think why we do certain things at EU level, and measure the objective value of EU power in certain areas.
After all, for a federation (especially one with many languages and cultures) to survive and prosper, it needs to have trust and legitimacy. And this legitimacy comes only if citizens believe that the right people are taking the decisions on their behalf.
With this paper, William Hague – unlikely as it sounds – may be helping to build a ‘federal’ Europe, in the proper sense of the word.