UK deal

UK deal

On 10 November 2015, in a letter to Donald Tusk, President of the European Council, Prime Minister David Cameron set out four key objectives for the UK’s negotiations. The objectives addressed issues in the areas of economic governance, competitiveness, sovereignty, and immigration.Agreement was reached on the UK’s demands at a meeting of the European Council on 18-19 February. The text is formally set out in a Decision ‘concerning a new settlement for the United Kingdom within the European Union’ (Annex I to the European Council conclusions – PDF). It includes the following provisions:Economic governance The Decision prohibits discrimination between natural or legal persons based on the official currency of the Member State where they are established. British businesses will therefore not be discriminated against for being outside the eurozone.With the aim of protecting the City of London, the UK will be able to initiate a debate among EU leaders about any potentially problematic eurozone legislation.Competitiveness The EU institutions and the Member States will make all efforts to fully implement and strengthen the internal market, and to adapt it to a changing environment. Concrete steps will be taken towards better regulation (specifically: reducing administrative burdens and compliance costs on economic operators – especially SMEs – and repealing unnecessary legislation). The EU will, however, continue to ensure high standards of consumer, employee, health and environmental protection.The European Union will also pursue an active and ambitious trade policy.Sovereignty The settlement recognises that the UK is not committed to further political integration into the EU. When the Treaties are next amended, they will make it clear that references to ever closer union do not apply to the UK.Social benefits & free movement The Decision states: ‘Member States have the possibility of refusing to grant social benefits to persons who exercise their right to freedom of movement solely in order to obtain Member States’ social assistance although they do not have sufficient resources to claim a right of residence.’EU legislation on freedom of movement for workers and on the coordination of social security systems will be amended to reflect that recognition.An alert and safeguard mechanism will address exceptional inflows of workers from other Member States over an extended period of time. When there are such levels of migration, an ‘emergency brake’ on migrants’ in-work benefits will apply. The UK will be able to operate the brake for seven years.Child benefit for the children of EU migrants living overseas will be paid at a rate based on the cost of living in their home country. The change will apply immediately for new arrivals and from 2020 for the 34,000 existing claimants living in the UK.Next stepsThe Decision would take effect on the same date as the British Government informed the Secretary-General of the Council that the UK had decided to remain a member of the European Union.Whether the deal is actually implemented will therefore depend on the outcome of the Referendum on 23 June. Mr Cameron has said that agreement on the reforms would address the UK’s concerns and provide ‘a fresh and lasting settlement’ for the UK’s membership of the EU.If the Referendum result is for the UK to leave the EU, then the Government must inform the European Council that it intends to do so. The UK would then be legally required to wait for two years before actually leaving.That time would be used to negotiate the future of the UK-EU relationship, addressing issues such as access to the Single Market and UK financial contributions to the Union.For more information, see The EU deal by Full Fact. Information from the UK Government about the Referendum is available on the Cabinet Office website.

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