Is Brexit a ‘worst-case-scenario’ for Europe, or is it an opportunity to revive EU integration through differentiation? In this post, Inga Runarsdottir and Benjamin Martill argue that the prediction that Brexit will lead to a radically more differentiated Union is overstated.
Given the varied levels and speeds with which Member States have joined the European core, “differentiated integration” has become a prominent feature of the European project. The concept of differentiated integration describes a heterogenous process of assimilation into the European Union, where states achieve accession to different institutions at varying speeds, and with distinct objectives.
An example of a deeply integrated Member State is France. As a member of the free-travel Schengen Area, participant of the European Monetary Union and a member of the European Defence Agency (EDA), France is as integrated into the European Union as it could be. Denmark, on the other hand, represents a less integrated Member State. While it is in Schengen, it is not in the Eurozone, and is the only EU Member State not participating in the EDA.
For a long time, the United Kingdom has been the EU’s poster child for a less integrated Member State. A strong advocate for opt-out clauses, the UK exemplified an important participant which refused to step fully into the circle. This has presented an obstacle for deeper integration of the Union. Without the UK’s support for key EU institutions, for example the Eurozone, full unification was never on the table.
Many smaller, less powerful Member States have benefitted from this, as they were able to hide behind the UK’s veto power and retain more perceived sovereignty than they would under the Franco-German ideal EU. With Brexit, the question of differentiation is more relevant than ever before. Is Brexit a ‘worst-case-scenario’, the failure of integration due to too much differentiation? Or is it an opportunity to renew the concept and renovate the union through differentiation?
Differentiation back on the agenda
Although many analysts posit that Brexit will lead to a radically more differentiated Union, this prediction is overstated. This is demonstrated in this article, through critically exploring four ways in which Brexit is often associated with an increase in the level of differentiation in the future EU.
First, Brexit has placed the question of differentiation back on the agenda for EU reform. Although it is a deeply integrated Member State, France is a long-standing supporter of a multi-speed Europe, and has pushed for greater differentiation in Eurozone reform and in security and defence. The European Commission, which typically favours more uniform integration, published its own scenario for a Europe in which ‘some do more, some do less’. However, this was only one of five potential scenarios. Think-tanks and academic observers have also joined the debate, advocating forms of differentiation as a means of ensuring the EU’s viability going forward.
But the fact that differentiation is back on the agenda does not make it inevitable. EU reform requires broad support among the Member States to move away from the status quo, and on the question of more differentiation this is currently lacking. Existing proposals for movement towards greater differentiation, including in the EU’s security and defence initiative ‘Permanent Structured Cooperation’ (PESCO), have seen the element of differentiation watered down by a German push for ‘inclusivity’.
Second, Brexit has highlighted a number of problems associated with the viability of an undifferentiated Union in which common rules are applied to a number of diverse national economies. Prime Minister David Cameron’s fateful 2015 call for a renegotiation attempt and referendum was motivated in part by securing derogations from core EU principles – notably free movement – which were creating political problems back home. And his failure to obtain this in the renegotiation was cited as one of the main contributors to the victory of the Leave side in the June 2016 referendum. This has led to some calls for greater flexibility on the part of the Union, lest other Member States choose a similar path.
Of course, the question remains as to how representative the British experience really is. Rising popular discontent against migrants is not unique to Britain, but other Member States are better able to distinguish between the internal and external. And the lessons of the UK experience with its opt-outs (from the euro, Schengen, Charter of Fundamental Rights, etc.) offer negative lessons for differentiation because these concessions did not remove political obstacles and may have actively encouraged requests for further special treatment.
Third, the British withdrawal will allow the EU to move forward with reforms which could introduce more examples of differentiation into the Union. Brexit is said to facilitate EU reform because it heralds the end of the ‘British veto’ over further integration and shifts the balance of power underlying the European project to the traditional Franco-German ‘engine’ of integration. Moreover, it has resulted in increasing unity of purpose among the remaining 27 EU countries.
But it is not clear the result will be differentiation, since Member States disagree on this very principle. And it is clear the institutional effects of Brexit have been oversold. Other Member States are sceptical of further integration, especially those who would hide behind the UK veto. Moreover, the Franco-German engine is stuttering and divergence between Berlin and Paris is significant. EU unity is an artefact of the Brexit talks and is notably lacking in other areas (e.g. Eurozone reform and enlargement).
Fourth, Brexit makes it necessary to spell out arrangements to govern the future relationship between the UK and the EU, and anything less than the ‘hardest’ Brexit will represent an increase in external forms of differentiation, with the UK engaging in EU policy areas from the outside. Regardless of whether these will be ‘bespoke’ or follow existing models, the extent of British integration since the 1970s augurs continued close ties.
The future of differentiated integration in the EU
However, there are good reasons for the EU to resist the kind of bespoke deal the UK had been hoping for, since this would be to offer the UK a more favourable deal as a non-member than it had as a member, and such a move may incentivise other Member States to head for the exit. Moreover, affording the UK preferential access to EU policies would undermine the EU’s decision-making autonomy, re-introduce potential veto-points (if only informally), and undermine the whole point of integration by allowing the UK to ‘cherry pick’ access in areas where it benefits the most.
While Brexit is the most dramatic event toward disintegration in EU history, it is not likely to cause a complete transformation of either the Union, its relationship with the UK, or the concept of differentiation. The EU27 have formed a united front in the Brexit negotiations, but the need for exception clauses will remain. The diverging Member States are losing an important ally in the UK, but their desire for opt-outs persists. On the whole, wholesale differentiation of the EU is unlikely, but the principle is intact and will continue to play a role in the development of the Union and its relationship with Member States and non-members alike.
Inga Runarsdottir is a Research Associate for the Dahrendorf Forum at LSE IDEAS. Benjamin Martill is a former Dahrendorf post-Doctoral Researcher, an associate at LSE IDEAS, and a Lecturer in Politics and International Relations at the University of Edinburgh.