Nosemonkey's EUtopia

In search of a European identity

Why the UK’s “audit” of EU law is a waste of time

So, supposedly in a bid to allow any future in-out referendum on UK membership of the EU to be based on facts rather than ideology (fat chance), Foreign Secretary William Hague has announced an “audit” of the influence of EU law on the UK.

The promised audit has, of course, got a lot of anti-EU types rather excited, as they’re all convinced that any such study will show the EU to be the pernicious, all-pervading menace they’ve always claimed it to be.

Leaping to their own conclusions, no matter what the real conclusions may be

See posterboy for the Tory anti-EU right Dan Hannan on his Telegraph blog for a prime case in point, in a post that reads almost like a parody:

“In 1973, the United Kingdom ceased to be a sovereign democracy. EU law has primacy over British law, and we are largely ruled by unelected Euro-functionaries”

He has some good points to make in places (I’m no fan of the Common Agricultural Policy or Common Fisheries Policy either), but as he so often does, mixes up assertion with opinion with unreferenced “facts” like the claim that:

“on the EU’s own figures, the costs of regulation outweigh the benefits of the single market by five to one (€600 billion versus €120 billion)”

Actual numbers, Mr Hannan? Why thank you! Let’s see how justifiable those are, shall we?

With a bit of digging, it turns out (surprise surprise) not to be quite that simple, and that the figures dear Mr Hannan has chosen are not what he presents them as being. By which I mean that Mr Hannan is either ignorant about the figures he’s quoting to illustrate his point, which is surprising for a man so keen to portray himself as a great intellect, or is deliberately misleading his audience. (i.e. Lying.)

Thanks to the Tory MEP defector to UKIP Roger Helmer for asking the question and receiving a reply that points out that the €120 billion figure dates from 1992 (when the EU had 15 members), the €600 billion figure from 2006 (when it had 27), and therefore the two are not fair comparisons (even without mentioning inflation).

Thanks in turn to Open Europe for tracking down the details surrounding the €600 billion figure, which Hannan and others attribute to former Commissioner Günter Verheugen. The explanation can be found in a footnote on page 12 of this (PDF) Open Europe study, Out of Control? Measuring a decade of EU regulation:

“this figure has been widely misunderstood, as it has been described as the total cost of EU regulation. In fact, this estimate captures the administrative burden stemming from EU regulations and domestic regulations combined. Furthermore, on 10 October 2006, the Financial Times wrote “The bureaucratic cost to business of complying with European legislation could be up to €600bn a year – almost twice the original estimates – the European Union’s Enterprise Commissioner admitted on Monday.” However, what Gunter Verheugen – the Commissioner in question – actually said in the interview about reducing regulation, was that “I’ve said that in my view it must be possible to get a 25 percent reduction, and that means a productivity gain of €150bn.” The journalist took this to mean that €150bn represented 25% of the total cost of regulation. However, Verheugen’s office has subsequently confirmed that the €150bn figure referred to the extra benefits that would be generated (as opposed to saved) by a 25% cut in the administrative burden of EU and domestic regulations combined.”

And so we see, once again, that Hannan’s numbers are far from accurate. If his own opinions about the EU’s malign influence are based on such misunderstandings, it’s understandable for him to be hostile. But it also means he’s wrong.

Misunderstandings, misinterpretations, and selective quotation

If it’s that hard to track down the source and true meaning of just *one* cost/benefit estimate, how much harder is it to track down the costs and benefits of the many thousands of pieces of legislation and regulations that have come out of the EU over the years?

And, more to the point, if misunderstandings like the one above are so simple, what are the chances of anyone actually understanding what the findings actually mean?

Another case in point, the House of Commons Library’s 2010 study (PDF) into the percentage of UK laws that stem from the EU concluded – with provisos – that the true figure was likely somewhere near 15%.

At least, that’s how I read it (partially because this tallies with the figure I’d come to, a figure that has since been backed up by a German study that came up with 15.5% for the UK).

But if you’re of a eurosceptic bent, you’ll argue – as did, for example, the Telegraph – that the actual conclusion was that up to 50% of laws come from Brussels. How is this possible? Simple – in *some* areas, EU law has far more influence than others, so for *some* government departments, around 50% of laws really do come from the EU.)

The HoC Library study itself actually concluded that “All measurements have their problems… The answer in numerical terms lies somewhere in between the two approaches, and it is possible to justify any measure between 15% and 50%”. So those of us who tend to the pro- side look low, those who tend to the anti- side look high, and both can feel justified.

What’s wrong with facts?

Of course, no one in their right mind could object to basing arguments on facts – and facts have long been in short supply when it comes to working out the EU’s influence and impact. Hague himself, after all, ran a general election campaign back in 2001 based largely on EU scaremongering, and his old euroscepticism can be revealed in his own assumptions of what such an exercise might achieve as he anounced this audit on Thursday:

“less cost, less bureaucracy and less meddling in the issues that belong to nation states”

If this audit really could get proper facts on the EU’s influence, I’d be all for it.

The trouble is, there have been plenty of similar studies conducted in recent years (most of which I’ve now rounded up in my old “What percentage of laws come from the EU?” post). And the most rigorous and respectable of them have all concluded the same things:

1) It’s practically impossible to work out the impact of EU laws, per se, due to:

a) the wild variation in the way they can be implemented
– directives vs regulations etc. etc.

b) the interconnectedness of policy areas
– knock-on effects of legislating in area A on areas B, C and D, both in terms of dilution of impact and exacerbation, are extremely hard to track (to put it mildly)

c) the tendency towards gold-plating
– UK officials and politicians adding additional clauses onto EU-originated laws that weren’t required by Brussels

d) the cumulative impact of almost 40 years of EEC/EU membership
– which British-originated rules/laws/regulations have been influenced by previous EEC/EU rules/laws/regulations
– has UK legal/legislative culture changed as a result of EU membership, leading to laws that are more “European” than they would have been without membership?

e) the incredibly obtuse methods by which most laws enter the statute books in the UK
statutory instruments, which bypass parliament, can be used for both UK and EU law. There have been an average of c.1,800 of these passed per year since 1987 (and, incidentally, there’s been a huge spike in the number since the Coalition came to power: 2010 and 2011 the two highest numbers ever)
– there’s no “track changes” function on legislation, so it’s often extremely hard to tell precisely where a law originated (you basically need to cross-reference all UK laws/regulations with all EU directives/laws and try to spot similarities – but just because there are similarities doesn’t mean that there’s necessarily a causal relationship, so this method will result in a lot of false positives)

f) the impossibility, in most cases, of tracking down the origin of the *idea* of a law
– was it actually from the EU? (it’s often impossible to tell, as in point e)
– was the EU itself the original source (laws that stem from the EU are, after all, almost always first proposed by EU member states – including the UK)
– what percentage of EU laws/regualtions applied in the UK were proposed to the EU by the UK, and what difference (if any) does that make to our perception of them?

g) which EU-originated rules *replaced* existing British ones more or less 1:1?
– the whole point of legislating at EU level is to harmonise laws and regulations between EU member states; it’s very rare for the EU to legislate in a new area, as EU legislation and regulations are almost always designed to replace existing rules in the member states
– most important, this, if you’re trying to work out how much the EU costs/saves its member states – because there is a strong case to be made that a law/regulation set at EU level by definition saves money, as otherwise it would have been introduced in 27 different ways by the 27 member states (not to mention in other countries, like Norway and Switzerland, that abide by EU law in numerous areas despite not being members) – this is why it’s possible to argue that legislating and regulating at EU level is almost always a good thing

h) which would the UK have introduced anyway?
– again, EU rules, regulations and legislation are (in principle) always guided (more or less) by the needs of the member states; the UK may have chosen slightly different forms for many EU-originated rules had she been left to her own devices, but if she really weren’t happy about a majority of them, she would have left ages ago.
– this is, of course, impossible to tell without an alternate universe in which the UK didn’t join…

i) which would the UK have to maintain if she were outside the EU?
– with estimates of the EU’s importance to the UK’s external trade varying between 40 and 60% (infinitely more detail here), to continue trading with the EU as a non-member would require a certain level of compliance with EU rules and regulations. What would the cost of this be to UK businesses, and would the cost saving advantages outweigh the disadvantages of no longer having any input into those rules and regulations in the first place?

2) A cost-benefit analysis of EU membership is pretty much impossible

a) we have no control group by which to measure the relative economic benefits/downsides
– no way to tell what would have happened to the UK (or any other member state) had they *not* joined
– no way to tell how each member state would have fared had the EEC/EU not existed

b) the whole point of the EU is its interconnectedness, so to understand its true impact you need to analyse the entire EU economy, not just that of one member state
– Britain, for example, imports from other EU states more than it exports (something eurosceptics are always fond of bringing up) – what impact has the EU had on the pricing structure of those imports due to the changes it has brought about in those other member states?

c) the sheer volume of laws tells you nothing about their impact
– the EU tends towards tiny trade regulations to maintain consistent product standards, which tends to push up their volume; how many pieces of regulation about the permissible ingredients in fruit jelly would it take to have a similar impact to the Legislative and Regulatory Reform Act 2006 or Anti-terrorism, Crime and Security Act 2001 (for example)?

d) there remains a considerable degree of policy area overlap between EU and national law
– even if it were possible to definitively identify a law as originating from the EU, there may be other, non-EU-derived national laws operating in the same general policy area
– how is it possible to tell the impact of law x over law y or law z when they’re all about more or less the same thing, and will all be interconnected?

e) the impact of laws and regulations goes far further than simple cash cost/benefit
– is it possible to put a monetary value on the benefits/disadvantages of the reduced stress of travelling that’s come thanks to the right to free movement between EU member states? Or of the pleasure that’s been brought by European cultural organisations more easily being able to travel the continent to entertain? Or the more ready availability of more interesting and varied foodstuffs from around the continent due to the (supposed) reduction in cost of trading between EU member states? Or of the granting of a recourse to law that’s beyond the power of the nation, giving ordinary citizens that little bit more security in their freedom (even if they don’t even realise this)?

And all that’s just off the top of my head on a lazy Saturday, after only half a cup of coffee.

Selective quotation, ignoring the inconvenient, and ideological blind spots

But this is the problem with any EU audit or cost-benefit analysis: there are infinite ways to poke holes in any figures that are derived at, both from the anti- and the pro-EU sides. Because the EU is simply too complex to divide up into costs and benefits. Not least because what may count as a benefit to some (personally I *like* having more European immigrants around the place, and feel that the increased diversity of experience and attitude such immigrants bring is a benefit to the economy and society at large) will be a bitter cost to others (not just xenophobes, but also UK citizens who may end up competing for jobs with those immigrants – or even just *feel* that they’re competing).

And then there’s the added issue that *everyone* suspects the current government’s motives for this audit, meaning that left, right, centre, pro-EU and anti-EU will *all* be looking to pick holes in it as soon as it appears. And if any of them don’t like the result, they’ll simply pick a number from a study they *do* like – which is why dear old Dan Hannan keeps on using the utterly discredited claim that 84% of laws come from the EU, old Nigel Farage of UKIP keeps using the 75% of laws come from the EU line, which has been equally rubbished on numerous occasions.

Why do Hannan and Farage keep using discredited figures, and ignoring studies they don’t like the results of? Because neither of them are actually interested in the truth – and I suspect that the government aren’t either. This smacks strongly as yet another excuse to delay the resumption of hostilities between the Conservative party and the eurosceptic fringe that would kick off as soon as a referendum campaign is started. Because even former arch-eurosceptic William Hague has come to realise that although the EU is far from perfect, the UK’s other options are even less appealing – and in the process has started to come under attack as an EU stooge from some of the more excitable (and delusional) quarters of the anti-EU crowd.

And herein lies the glorious irony – it’s taken the EU’s worst crisis in its history, with the entire organisation standing on the brink of potential collapse, to convince some of the UK’s most vocal opponents of European integration of the EU’s benefits. Hell, even long-time eurosceptic campaigners Open Europe are starting to come out to argue the benefits of membership.

But many hardcore eurosceptics will never be convinced. For them, costs and benefits are irrelevant. This is not about money or trade or economics – this is about idealogy, sovereignty, independence. Better to be a poor free man than a rich slave and all that. No amount of audits or numbers will ever convince them that allowing a bunch of foreigners to have any say in the way we run our country can be right – even if we get a say in how they run *their* countries in exchange. It is the psychological cost of this perceived loss of freedom that is the most important for them, and even were the streets of Europe paved with gold it wouldn’t be enough to convince them otherwise.

As for the people as a whole? As per usual, the vast majority simply won’t care.