Differentiated integration and its challenges

Complexity favours inter-governmentalism

2018-01-11

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The idea of a multi-speed Europe is not new. In fact, it is not just an idea but a general description of the current state of the integration process. We have euro and non-euro countries. Those who are members of the passport-free Schengen Area and those who are not. And so on. More recently, there have been breakthroughs in European defence policy, with an agreement on establishing a Permanent Structured Cooperation (PESCO). This too is among a subset of all EU Member States.

The trend will not be reversed any time soon. Differentiated integration is considered standard practice. The Treaties themselves recognise as much, with their provisions on PESCO, enhanced cooperation, and others. Besides, the increasing diversity of opinions on the future of Europe, means that it is practically impossible to get every country involved. Smaller coalitions of willing and able states are the norm going forward.

Alliances are policy-dependent, effectively allowing the coexistence of two fundamentally different approaches to European politics: (a) the original sense of an ever closer union, effectively a tightly integrated federal system with EU institutions playing an important role in policy-making, and (b) the treatment of the EU as a platform for inter-governmental decision-making, in the spirit of an alliance of independent nations.

Differentiated integration thus allows Europe to function as a set of concentric circles. On the ‘outer’ circle are the policies where countries are not willing to commit to deepening their ties. The ‘inner’ circle is where the “ever closer union” is rendered concrete. It is important to note that the circles encompass areas of policy, not countries. For example, Cyprus is part of the euro though not of Schengen. Poland has its own currency but is part of PESCO. This is consistent with the overall distribution of competences in the EU and the resulting scopes of effective sovereignty.¹

One can clearly see the appeal of a multi-speed Europe. Having a growing number of governments agree unanimously on every area of policy is a recipe for stagnation. The history of the integration process is replete with such instances. Better allow countries some leeway, to proceed at their own pace and to adapt to evolving circumstances in European politics in a manner that is consistent with their constitutional identity.

The price paid is complexity. To accommodate multiple speeds, policy makers must come up with creative ways to keep the system functional and within the limits of European law. They must occasionally resort to extraordinary measures, such as inter-states Treaties that are outside the acquis though consistent with it (ESM Treaty and Fiscal Compact).

Complexity consists of two variants: (i) institutional complexity which makes the adoption of decisions a slower and more demanding process, and (ii) obscurity and the obfuscation of “who governs” and “where is the locus of power”.

The first variant is one of the reasons the ‘Brussels’ apparatus is perceived as a detached bureaucracy. Everything seems to take forever until it is agreed upon. Part of the perceived delays is normal, given how the ordinary legislative procedure involves both the European Parliament and the Council of the EU as co-legislative institutions. It is also justified by the need to have the European Council agree on the agenda that is eventually converted into action on the policy front. Still, there are cases where complexity is clearly a stumbling block. One need only recall the eurocrisis with the seemingly endless Eurogroup meetings, the Euro Summits that would last until the early morning hours, and the like. Where there are multiple actors, there will inevitably be delays. Perception does not constitute reality: the EU is not a bureaucracy but an idiosyncratic federal system. Nevertheless, it does contain a kernel of truth and is hard to argue against, because of the second variant of complexity: obscurity.

One needs to invest considerable time in order to understand who does what over any given area of policy. The general separation of powers is clear, but things get very tricky, very quick. For example, the European Commission typically performs the functions of the executive. However, a portion of executive functions stays with the European Council. It is the latter that will decide on the direction of the integration process. As such, the Commission is the implementing arm, while the European Council is the deciding one. Similarly, the European Central Bank is an EU institution, but has jurisdiction over the euro area. Legislation that concerns the euro is voted in Parliament by all MEPs, not just those from countries whose currency is the euro. The Eurogroup is not an official entity, but is foreseen in a Protocol to the Treaties, which still does not make it an EU entity. Whatever its legal status, the Eurogroup is of paramount importance to economic policy in the euro area. And the list goes on. The point being that it is very difficult to answer in advance the two keys questions of “who governs?” and “where is the locus of power?”, for it all depends of the specifics of the case.

Parliamentary democracy eventually loses out. The system is too complex to be scrutinised properly and in a timely fashion. The European Parliament may not exercise control over decisions that are adopted at the inter-governmental level (European Council, Eurogroup). Citizens cannot voice themselves in a uniform way, such as by electing a new government for the EU as a whole.

Can something be done? I think differentiated integration can focus on legal arrangements that strengthen parliamentarian norms. The content of policy matters greatly on how the integration process evolves. But there is an inherent trade-off that cannot be circumvented. Differentiation creates complexity. Complexity makes policy-making more intricate, while also creating uncertainty over who is in charge and where power is located.

Differentiated integration is here to stay, so we will have to learn to live with its downsides. It thus falls on politicians and communicators to better explain what happens in European politics. Understandably, in the age of fake news and with the widespread obsession to digest information in byte-sized portions, it will be challenging to get the message across. Though that is what democracy entails. Engage with people in their milieu.

1. Sovereignty and the vertical separation of powers in the EU. Distribution of competences in the EU federal system. Published on December 31, 2017 as part of the seminar series Advanced issues of political organisation. [^]