Prime Minister David Cameron yesterday promised Britons a vote on whether the country should stay in the European Union or leave, rattling London’s biggest allies and some investors by raising the prospect of uncertainty and upheaval.
Cameron announced the referendum would be held by the end of 2017, provided he wins the next election, and said that while Britain did not want to retreat from the world, public disillusionment with the EU was at “an all-time high”.
“It is time for the British people to have their say. It is time for us to settle this question about Britain and Europe,” Cameron said in a speech, adding that his Conservative party would campaign for the 2015 election on a promise to renegotiate the terms of Britain’s EU membership.
“When we have negotiated that new settlement, we will give the British people a referendum with a very simple in or out choice to stay in the European Union on these new terms; or come out altogether. It will be an in-out referendum.”
A referendum would mark the second time Britons have voted on the issue. In 1975, they decided by a wide margin to stay in the EU’s predecessor, two years after the country had joined.
Domestically, Cameron stands on relatively firm ground.
Most recent opinion polls have shown a slim majority would vote to leave the EU amid often bitter disenchantment about its influence on the British way of life.
However, a poll this week showed a majority wanted to stay.
Cameron’s position is fraught with uncertainty.
He must come from behind to win the next election, secure support from the EU’s 26 other states for a new British role, and hope those countries can persuade their voters to back the changes.
Critics say that in the long run-up to a vote, Britain would slip into a dangerous and damaging limbo that could leave the country adrift or pushed out of the EU.
Billed by commentators as the most important speech of Cameron’s career, his referendum promise ties him firmly to an issue that has bedevilled a generation of Conservative leaders.
In the past, he has been careful to avoid bruising partisan fights over Europe, an issue that undid the past two Conservative prime ministers, John Major and Margaret Thatcher.
Cameron said he would seek to claw back powers from Brussels, saying later in Parliament that when it came to employment, social and environmental legislation “Europe has gone far too far”.
But such a clawback – the subject of an internal audit to identify which powers he should target for repatriation – is likely to be easier said than done.
Business leaders have warned that years of doubt over Britain’s EU membership would damage the $2.5 trillion economy and cool the investment climate.
Reactions to historic speech
The British PM’s speech yesterday appeared to pacify a powerful Eurosceptic wing inside his own party, but it also helped to deepen rifts with the Liberal Democrats, the junior partners in his coalition. Their leader, Deputy Prime Minister Nick Clegg, said the plan would undermine a fragile economic recovery.
Furthermore, Labour leader Ed Miliband said yesterday his party did not want an in/out referendum.
The United States, a close ally of the UK, is looking uneasy about the plan, believing it will dilute Britain’s international clout.
President Barack Obama told Cameron by phone last week that Washington valued “a strong UK in a strong European Union”.
Yesterday the White House insisted the US believes Britain is stronger by being a part of the European Union and the EU is stronger as a result of Britain’s membership. White House spokesman Jay Carney made the comments at a press briefing directly after Cameron’s speech.
Meanwhile, some of Britain’s European partners were also anxious and told Cameron yesterday his strategy reflected a selfish and ignorant attitude.
However, Angela Merkel, the leader of EU paymaster Germany, was quick to say she was ready to discuss Cameron’s ideas.
French Foreign Minister Laurent Fabius was less diplomatic, quipping: “If Britain wants to leave Europe we will roll out the red carpet for you,” echoing Cameron, who once used the same words to invite rich Frenchmen alienated by high taxes to move to Britain.