Daniel Kenealy
Specialist Adviser, Senior Vice Principal's Office, Lecturer, School of Social & Political Science, University of Edinburgh
Papiers d'actualité / Current Affairs in Perspective
Fondation Pierre du Bois
No 6, July 2016
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More than three weeks have passed since 17.4 million UK citizens voted for their country to leave the European Union (EU) in a national referendum held on 23 June. It has been one of the most eventful three weeks in modern UK politics. The referendum result brought the premiership of David Cameron to an abrupt, and premature, end. What was expected to be a contest, held over several months, to select Mr Cameron’s replacement as leader of the UK Conservative Party and prime minister was quickly brought to a resolution. Senior Conservative politicians who had led the campaign for ‘Brexit’ were quickly discarded. Theresa May – the UK’s longest serving Home Secretary since 1951 who supported remaining in the EU but who kept a low profile during the referendum – contested the leadership against Andrea Leadsom, a junior energy minister who backed Brexit and who came to prominence during the referendum campaign. As the contest moved from voting by Conservative MPs in the House of Commons to the party membership across the country Mrs Leadsom withdrew, citing insufficient support amongst her fellow MPs. A contest became a coronation and Mrs May was appointed prime minister on 13 July, one day short of three weeks since the referendum.
The turmoil unleashed by Brexit spread far beyond the senior levels of government. In the immediate aftermath the pound fell against the dollar to the lowest level since 1985; the FTSE 100 fell to 2007 levels before recovering; growth forecasts were revised downward; banks planned to move staff from London; and reports suggested that investments in the UK were being deferred because of economic uncertainty. In the days after the vote there were also reports of a rise in anti-immigrant attacks and ‘hate crimes’ reported to the police. Brexit also ensnared the opposition Labour party in drama. The vast majority of Labour’s MPs used the referendum outcome as an excuse to move against their leader Jeremy Corbyn. Elected in a landslide in September 2015, Mr Corbyn had never been supported or accepted by his fellow Labour MPs. The Labour party now faces an existential challenge and the leadership contest – guaranteed to be nasty and bitter – that will run until September 2016 does not look likely to resolve it. A split of the Labour party remains a distinct possibility.
Brexit was greeted with shock both within the UK and internationally. But, placed, in its appropriate historical context it appears less shocking. Brexit is the result of deeper forces that have increasingly come to characterise UK politics over the past two decades. The remainder of this piece poses three questions: Why did the UK have a referendum? What explains the outcome of the referendum? And what are the longer-term implications for the UK?
Why did the UK have a referendum?
The idea of leaving the EU is not a recent addition to UK political discourse. No sooner had the UK joined the (then) European Economic Community (EEC) than its citizens were asked to decide, in a national referendum, whether they wished to remain. That referendum, on 5 June 1975, saw a substantial vote – 67.2 per cent of votes cast – to remain in the EEC. But it split Harold Wilson’s governing Labour party badly. For much of the 1970s and 1980s Labour was the party most clearly divided on the question of European integration and it was official party policy for much of the 1980s to leave the EEC. But it is within the Conservative party that the idea of leaving the EU has most firmly taken root since the late 1980s.
Margaret Thatcher was an enthusiastic campaigner for the UK to remain in the EEC in 1975 and, upon becoming prime minister in 1979, was initially supportive of further market integration. Despite fighting with the EEC over the UK’s financial contribution to the organisation, Mrs Thatcher saw in it the possibility of furthering her liberal market agenda and she was instrumental in the agreement and signing of the Single European Act. The battle over the UK’s budgetary contributions was not the only manifestation of what scholars have called the ‘awkward partnership’ between the UK and the EU. The UK has always stood at arms length from various European integration projects. It waited until 1990 to join the European Monetary System – an issue that contributed to Thatcher’s downfall – and it has negotiated opt-outs from the single currency (the ‘Euro’), the Schengen Agreement, and EU legislation in the area Area of Freedom, Justice and Security. The UK has thus, since the early 1990s, had a unique relationship with the EU, being a member but at the same time opting out of several major policy initiatives.
It was during the later 1980s that intra-Conservative party tensions on ‘Europe’ began to come to the fore. Mrs Thatcher herself became more aggressively anti-EEC as her premiership wore on, dismayed at what she saw as a federal grand design personified by the European Commission president Jacques Delors and the expansion of EEC regulations. Mrs Thatcher’s concern was at once grounded in economics and in sovereignty. Intra-Conservative party divisions over Europe played a significant role in Mrs Thatcher’s downfall.
They continued to fester during the premiership of her successor John Major – who was incapable of preventing party divisions over the 1992 Maastricht Treaty – and, in 1994, Major’s former Chancellor of the Exchequer, Norman Lamont, became the first leading Conservative party figure to publicly give voice to the possibility of Brexit. During 1997-2010, the thirteen years during which the Conservative party were in opposition to New Labour’s Tony Blair and Gordon Brown, Euroscepticism within the Conservative ranks continued to grow. To a large extent that Euroscepticism was a response to the euro-enthusiasm of Blair, a prime minister who was committed to joining the single currency and who refused to hold referendums on EU treaties. It was never a singular Euroscepticism. For some Conservatives the EU was to be opposed because it was overly regulative. For others it was to be opposed because of the free movement of labour. And for others it was a question of sovereignty and national self-determination.
Upon assuming the Conservative leadership in 2005, Mr Cameron inherited a party that was deeply divided on the issue of the EU and he had no strategy to heal those divisions. Instead he tried to placate a group of MPs whose implacable opposition to the EU made them irreconcilable on the subject. Mr Cameron’s juggling act included withdrawing Conservative MEPs from the main centre-right European People’s Party grouping in the European Parliament. In 2007 he committed to a referendum of the EU’s Lisbon Treaty only to reverse his position in 2009, arguing that the Treaty had been ratified, incorporated into UK law and could not be reversed. And he promised to legislate so that any further transfer of powers from the UK to the EU could only happen after the UK had voted for it in a referendum.
When Mr Cameron became prime minister in May 2010 it was at the head of a coalition government in partnership with the pro-EU Liberal Democrats, led by Nick Clegg who served as deputy prime minister. He was able, for five years, to fudge the issue of the UK’s membership of the EU. Although the presence of Liberal Democrats in government gave Mr Cameron an excuse not to tackle the issue head-on, it also heightened the discontent amongst Eurosceptic Conservative MPs. The commitment that no further powers could be transferred from the UK to the EU without a referendum was honoured in the European Union Act of 2011. During 2012 – as the Eurozone crisis intensified and the government failed to get reduced net migration levels to the UK – Mr Cameron started to feel under greater pressure to deal with his party’s EU issue. Furthermore, the UK Independence Party (UKIP) – a populist right-wing party opposed to immigration and committed to the UK leaving the EU – was continuing to advance in the opinion polls. Cameron reportedly told Clegg: “What else can I do? My backbenchers are unbelievably Eurosceptic and UKIP are breathing down my neck.”
In January 2013 Mr Cameron committed to renegotiating the terms of UK membership, followed by an in/out referendum. He never expected to deliver on the promise. Most commentators expected that he would lose office in May 2015 or return, once again, in coalition with Clegg’s Liberal Democrats. Instead, he won an overall majority and his promise – included in the Conservative’s 2015 manifesto – had to be delivered. The decision to stage the EU referendum is thus best understood as the end product of decades of festering discontent within the Conservative party. Mr Cameron’s approach to party management led him to make a risky bet. Although a soft Eurosceptic himself, who wanted to see the EU do less, Mr Cameron lacked a clear vision of a reformed EU. His renegotiation of the terms of UK membership – concluded at the European Council of 18-19 February 2016 – while significant in introducing emergency break provisions on the free movement of labour ultimately fell far short of what was acceptable to many of Mr Cameron’s MPs. The renegotiation’s main flaw was that it was too complicated to clearly communicate to the electorate as a game changing ‘win’.
Whilst the Conservatives were indulging this internal division, deeper shifts were taking place in UK society. If Conservative party politics is the key to understanding why the referendum was called, then a process of economic and political marginalisation at the mass level is the key to understanding the result.
Why did the UK vote to leave?
Early analysis of the referendum voting patterns reveals deep divisions that have been building within UK society for decades. There is a stark divide between parts of the UK that voted to leave versus parts that voted to remain. Professor Matt Goodwin looked at the 20 most pro-leave areas of the UK and the 20 most pro-remain areas. People in the pro-remain areas were far more likely than people in pro-leave areas to be: university educated (45 per cent versus 16 per cent); professionals (42 per cent versus 23 per cent); and non-white (26 per cent versus 5 per cent). Pensioners made up 20 per cent of the population of the most pro-leave areas versus just 11 per cent in the most pro-remain areas. And the median income of £27,000 in the most pro-remain areas was far higher than the £18,000 in the most pro-leave areas. Analysis by the Financial Times similarly demonstrated the deep divisions between ‘leavers’ and ‘remainers’ along the dimensions of education, class, and age. Lord Ashcroft, a pollster, analysed the result at the individual level and found that age and social class were highly determinative of voting patterns.
It would be fair to understand the referendum as a plebiscite on globalisation. Those who have broadly been the ‘winners’ of globalisation voted to remain in the EU. Those who have broadly been the ‘losers’ voted for Brexit. This is not a short-term story. Those who voted for Brexit were not rationally responding to the impact of the economic crisis or the recent impact of immigration in their local areas. Research by the Resolution Foundation found no correlation between areas where wages have fallen since 2002 and the likelihood of voting for Brexit. Areas that voted to leave were not areas that did badly in recent years. Rather, they were areas that have done badly over several decades, areas that are historically poor and have fallen behind since the mid-1980s. They are the former industrial heartlands, and fading coastal communities, of England and the former coal and steel mill towns of Wales.
Economic marginalisation has gone hand-in-hand with political marginalisation. Both Labour and the Conservative party have pitched their offer to the middle classes over recent decades. Both Tony Blair and David Cameron tried to appeal to a centre ground of UK politics populated by those who were broadly winning from globalisation and possessing of a generally liberal outlook. For Blair the calculation was simple: pivoting to the centre was not a risky strategy when Labour’s older core of poorer, less well educated, white voters had no alternative political home. Increasingly many of Labour’s core voters simply stayed at home. It is telling that Blair won his third election in 2005 with 9.5 million votes, more than half a million fewer votes than Neil Kinnock’s Labour party won when it lost heavily to Thatcher in 1987.
Into this political vacuum stepped UKIP. With its anti-European and anti-immigration message the party picked up voters from both Labour and the Conservatives. Brexit built on UKIP’s political foundations. Whilst a first-past-the-post electoral system has thwarted the party at Westminster it has steadily risen to become the UK’s third political party, capturing 12.7 per cent of the vote in the 2015 general election. The masterful fusion of Europe and immigration, and the leadership of Nigel Farage proved potent. The Oxford political scientists Jon Mellon and Steve Fishers observed that if you take UKIP’s geographical share of the vote in the 2015 general election and add 25 per cent you get a strong correlation with the strength of the Brexit vote. UKIP might not be able to win over that number of voters when the formation of a government is at stake, but in a single issue referendum the appeal of their message was clearly broader than many appreciated.
UKIP’s emphasis on Englishness and English identity – despite the name of the party – is also connected to the story of political marginalisation. With Scotland, Wales and Northern Ireland possessing their own devolved governments as a result of devolution in the 1990s, England became a political community without a voice. Remarkably, according to Lord Ashcroft’s analysis, 79 per cent of those claiming an ‘English, not British’ identity voted for Brexit compared to 60 per cent of those claiming a ‘British, not English’ identity who voted against. The so-called ‘English Question’ in UK politics has not been convincingly answered but it has emerged as an important, identity-based, political cleavage.
Those who felt both politically and economically marginalised entered the referendum feeling that the UK’s political establishment simply was not working for them. It is therefore unsurprising that elites of all stripes – not just politicians but expert economists, businesspeople, foreign leaders, international organisations, the Bank of England – were rejected by large numbers of voters. As Michael Gove, a leading Brexit campaigner, put it in a televised debate: “People in this country have had enough of experts.” Post-truth politics had come to the UK and the debate was largely devoid of rational argumentation and empirical evidence.
Such sentiments contributed to the general ineffectiveness of the campaign to remain in the EU, officially called ‘Britain Stronger In Europe’. A decision was taken early on to craft a message centred on the economic risks of Brexit. This was to be blended with a heavy dose of what, in UK politics, has been called ‘Project Fear’. The strategy of hitting the electorate with messages of risk and danger had been successful in the Scottish independence referendum of 2014 and had worked for the Conservative party in the 2015 general election. Yet for the many voters who felt as though they had nothing to lose – because the UK economy had not been delivering benefits to them and their communities for many years – such arguments rang hollow. On the leave side there were two campaigns. The official campaign (‘Vote Leave’) focused on the loss of UK sovereignty, the alleged regulatory burden of the EU, and the possibility of Brexit allowing the UK to forge its own trade deals unencumbered by a sclerotic and out-dated EU. A parallel campaign (‘Leave.EU’ supported by ‘Grassroots Out’), more closely associated with UKIP, was nationalistic, nativist, staunchly anti-immigration, and tied up with notions of English identity. Both leave campaigns were nestled within a broader, historical sentiment that was nostalgic about the UK’s former empire, the Commonwealth, and the prospect of the UK forging a new and more confident international role.
As the referendum entered its closing stages the message of economic risk was drowned out by a combination of immigration, the amount of money the UK pays into the EU budget, and the simplicity of the Vote Leave’s campaign’s slogan – ‘Take Back Control’. According to polling by YouGov, 47 per cent of people thought that Brexit would make no difference to their personal financial situation just days before the vote. In contrast, 42 per cent of people in Scotland thought that independence would make them worse off financially days before that referendum in September 2014. In a climate where trust in elites of all stripes was lacking, and where expertise was openly derided, Project Fear was unable to gain sufficient traction.
It will remain a counterfactual whether a better campaign could have produced a different outcome. A longer campaign could have allowed voters to become more engaged and knowledgeable. Research on Scotland’s independence referendum demonstrates that it was the length of the campaign – formally eighteen months – that allowed voters in Scotland to engage as fully as they did. But for Mr Cameron the objective was to lance the EU boil as quickly as possible in the interests of party management and cohesion. His failure to offer a vision of a reformed EU and a convincing, positive argument for why the UK should vote to remain, coupled with the deeper political trends sketched above, presented the remain campaign with a difficult challenge. In the end, the result was not close. With 72 per cent turnout, 17.4 million people voted to leave (51.9 per cent of the total vote) against 16.1 million people who voted to remain (48.1 per cent of the total vote).
What future for the United Kingdom?
The differences in the vote by geography raise serious questions about the future of the UK itself. Scotland (62 per cent), Northern Ireland (56 per cent), and London (60 per cent) all voted to remain in the EU. The eight regions of England, and Wales, voted to leave although that way of aggregating the result masks the fact that major cities such as Liverpool and Manchester voted to remain. The UK’s departure from the EU would raise complex questions in Anglo-Irish relations, most significantly the issue of the border between Northern Ireland and the Republic of Ireland. It also creates problems in Gibraltar – where 96 per cent of people voted to remain – given the interdependencies between Gibraltar and Spain and the historical dispute between the UK and Spain over Gibraltar. Yet it is the position of Scotland that most directly threatens the integrity of the UK.
Scotland, it seems, has been edging ever closer to leaving the UK following an independence referendum in September 2014. Support for Scottish independence – hovering at around 30 per cent as recently as mid-2013 – jumped to 45 per cent in the independence referendum. In the aftermath it continued to rise, approaching but not surpassing 50 per cent. The Scottish National Party (SNP) went from strength to strength, capturing 56 of Scotland’s 59 Westminster seats in the May 2015 general election, wiping out Labour in the process. The SNP followed that success with a third consecutive Scottish Parliament election victory in May 2016.
Nicola Sturgeon, the SNP’s leader and Scotland’s first minister, is firmly in control of Scotland’s political agenda and moved quickly, following the EU referendum result, to capitalise. On the morning of 24 June, Mrs Sturgeon immediately put the prospect of a second Scottish independence referendum ‘back on the table’ and, traveling to Brussels, pledged to defend Scotland’s position within the EU. The only obvious way for Scotland to remain within the EU – assuming that Brexit happens – is for it become independent and seek EU membership. Short of independence, it may be possible, within the UK’s constitutional set up, for Scotland to have a relationship with the EU that is different from that of England and Wales, but that would likely require the devolution of further powers to the Scottish Parliament in policy areas such as employment and migration.
If people in Scotland are forced, in the coming years, to choose between their membership of the UK and their membership of the EU – essentially the choice offered in a second independence referendum – then it remains unclear how they would vote. The SNP have set a threshold of consistent support for Scottish independence of 60 per cent before they feel comfortable calling a second referendum. In the aftermath of the EU referendum there does appear to be, for the first time, majority support of independence in Scotland. However, it is far less clear that support has the depth necessary to make the SNP comfortable calling a second independence vote. Support for Scottish independence may dissipate the further we move from the EU referendum and may be sensitive to the future tone and policies – especially regarding the terms and conditions of Brexit – of the UK government.
The task of Theresa May is thus not only to negotiate a new settlement with the EU but also to try and hold the UK together. The early signs are that Mrs May could break with the liberal conservatism that characterised Mr Cameron’s premiership. In its place would be an approach that blends fiscal responsibility, law and order, and public service efficiency. But fiscal responsibility would not be achieved by cutting the welfare budget for the poorest in society. Concerns about immigration might be dealt with via both stricter controls on who comes into the UK but also through ensuring that the UK’s public services and infrastructure are capable of dealing with new arrivals. It could be a more profound shift than many currently appreciate. But, with a slim parliamentary majority and many of her MPs viewing society through different lenses to her, the new prime minister might struggle to deliver her programme. It remains to be seen whether this latest attempt to find a compromise between two long-standing traditions of the Conservative party – Gladstonian liberalism and Toryism – will have an impact on the political and economic marginalisation discussed above.
Internationally, the new UK government has to commence negotiations with the EU both about exiting and the shape of any future relationship. The crux of the negotiation will be the UK’s desire to access the EU single market in both goods and, crucially, services and the EU’s desire to make that access contingent on the free movement of labour. Technically, the EU referendum simply asked UK voters whether they wished leave the EU. That leaves open the possibility that the UK might re-join the European Free Trade Association (the UK was a founding member in 1960) and have a similar relationship to the EU as Norway does, complete with membership of the single market. But such a relationship involves the free movement of labour and the spirit of the referendum result – with its emphasis on taking back control of the UK’s borders and controlling immigration – makes such an outcome very difficult to sell politically. It is not hard to imagine such an outcome sparking significant political unrest, especially with Nigel Farage and UKIP hovering as self-appointed ‘guardians’ of the referendum result.
Beyond Europe, the question of the UK’s future role in the world hangs in the balance. The prized ‘special relationship’ with the United States might start to seem a lot less special, viewed from Washington, DC, if the UK becomes more insular, isolationist and protectionist. The US-UK relationship remains a fundamentally pragmatic one, forged in the context of the post-1945 global order. It should not be assumed to be permanent. For many years the UK political establishment has avoided a serious conversation about the nation’s international role. That conversation can no longer be postponed.
In closing let me return to where I started, to Mr Cameron who has now exited the stage, his legacy is in tatters. Like Tony Blair and Iraq, like Anthony Eden and Suez, his premiership seems likely to be associated with one word: Brexit. Mr Cameron is a man who managed, against the odds, to keep a coalition government together for five years and who, against even greater odds, delivered the first parliamentary majority for the Conservative party since 1992. But he was also a tactician without a broader strategic vision, a prime minister who gambled once too often and lost a hand in which he had wagered his legacy. It falls to his successor to navigate some very turbulent domestic and international waters.
Last Updated on Monday, 25 July 2016 08:50