• the deal reached by the European Council on Friday night contained no big surprises, and is already widely discounted as either positive or negative in the campaign for the British referendum on EU membership, which will take place on June 23;
  • The decision by Boris Johnson and Michael Gove to support the campaign to leave will make this a much more finely balanced contest;
  • John Rentoul is shocked to see just how many Tory MPs – about half – will be joining the Leave campaign;
  • the pro-EU camp is now beginning to shoot with heavier artillery, warning about a collapse of the City London – and its relocation to Edinburgh – and the possibility that this could put Jeremy Corbyn into Downing Street;
  • Sylvie Goulard and Wolfgang Munchau note that the EU/UK agreement is hugely problematic – it is unfair to the eurozone and likely unworkable in practice;


The events of the last three days are clearly showing us why it would be imprudent to be too sure about the outcome of the June 23 referendum in the UK. The euphoria about the deal in the European Council was followed by the realism that it has no impact on the British domestic debate. On the contrary, two heavy-weight Tory politicians – Boris Johnson, the mayor of London, and Michael Gove, the justice secretary – have launched the Leave campaign. Johnson’s article in the Daily Telegraph this morning, in which he lays out his views, constitutes a smart challenge that might win over people who are sitting on the fence – a stance not marked by xenophobia, but by perceived self-interest.

After two days of intense negotiations, the European Council reached a settlement with the UK that is set out in Annex 1 of the Council conclusions. It is remarkably similar to the draft documents that circulated earlier, and contains no real surprises. Britain’s derogation from ever-closer union is enshrined in a different place than before, as is the singularity of the single rulebook which is the item of greatest interest to us. However, as Wolfgang Munchau notes in his FT column, the exceptions that pertain to the UK may be formidable, and ultimately not sustainable. A banking union for the eurozone only with the right by the UK to interpret banking regulation differently for UK-based banks, yet with full access to the eurozone financial market, is going to be a source of permanenent friction. His view is that there are three possible outcomes from this process: The deal unravels legally – which some serious folk in Brussels believe it will – in which case expect a re-run of the kind of we-were-misled whining that followed the 1975 referendum; or the deal sticks and Britain votes to remain in the EU, in which case the EU may become ungovernable as Munchau believes it will; or Britain leaves.

Sylvie Goulard also notes that the Council decision is not as legally binding as it appears. The European Council cannot unilaterally change the European Treaties. It cannot be binding on one party and be interpretative on the others. The deal is fundamentally unfair for the eurozone, and she invokes the parallel between England and Scotland where asymmetrical constitutional agreements (Scotish MPs voting on English legislation, but not vice-versa) can lead to big problems.

The initial political assessment of the weekend is that the pro-Brexit side is coming out on top, for now. John Rentoul writes in the Independent that he misjudged how many Conservative MPs would break with David Cameron. There were only 30 MPs, who had declared themselves openly in favour of Brexit before the weekend. Unlike Cameron, they were not waiting to see whether he could get a good deal, but waiting until they could declare their intention without endangering their political careers. He estimate that more than half of Tory MPs may be campaigning to leave the EU.

John Springford says the EU deal will not help Cameron a lot. His best chance is to move to more lofty terrain, away from technical issues such as bank supervision or migrants’ benefits. This is about the EU itself. The Financial Times notes in its editorial that the case for EU membership has yet to be made in the UK debate. “It cannot be allowed to go by default.”

Anatole Kaletsky not only believes that the British will vote in favour of staying inside the EU. He even thinks he knows that there will be a last-minute swing towards the Remain camp. This is because people will then realise the financial and economic implications. He cites Rupert Murdoch’s business interests. Without Britain in the EU he will find it harder to consolidate his TV interests. And then consider this:

“Or maybe just for England, given that Scotland would probably leave the UK and rejoin the EU, taking many of London’s service jobs to Edinburgh in the process. Once Britain’s political, business, and media leaders start drawing attention to these hard facts of life after Brexit, we can be confident that voters will decide to stay in the EU.”

Hugo Dixon writes that the increase in expectations that the UK might, after all, leave the EU, has already led to a 9% fall in sterling’s exchange rate against the euro. Imagine what would happen if Britain actually left. One scenario he paints is that Jeremy Corbyn might then be in a good position to become prime minister, as the Tory party would be hopelessly split.

And finally, Erik Jones makes the point the the EU/UK agreement constitutes a gigantic category error.

“There is plenty of reason to doubt the outcome. The campaign Cameron has chosen rests heavily on misdirection and suspension of reality. … It is a misdirection insofar as the precise terms of the agreement do not touch on the heart of popular disaffection with Europe. The British people are unhappy because they fear the erosion of sovereignty, the influx of foreigners, and the economic insecurity that comes from engaging in a global economy. …It is a suspension of reality insofar as no one looking at splintering of European leaders around the ongoing migration crisis can seriously imagine that an ‘ever closer union’ is a threat to British sovereignty.”