Future of Europe: Difficult and unavoidable decisions in prospect of Brexit

In response to the results of last year’s referendum in the UK and the European-wide rise of populism and Euroscepticism, a strong reform agenda has emerged in the EU. In 2017, various stakeholders contributed their ideas on how to improve European governance. This year, the EU must grapple with at least two immediate challenges arising from the prospect of Brexit, both of which will require careful and concerted attention: how to distribute the 73 seats in the European Parliament that will become vacant once the UK leaves and the EU budget beyond 2020, given that the UK is currently the second-largest net contributor.

With respect to the first challenge, it is the responsibility of the member states to decide how to proceed: downsize the Parliament or redistribute the seats? One idea currently under debate would entail the introduction of a transnational list, which would put forward candidates to be elected from a constituency formed by the whole territory of the EU. This proposal might be a modest step towards reducing the age-old democratic deficit from which the EU suffers, but can it in reality foster greater engagement on the part of EU citizens with the supranational layer of governance? Will it stimulate cross-country debate on EU-level issues? A related item is the lead candidate (Spitzenkandidaten) system for appointing the President of the Commission. European leaders have little political leeway to diverge from this procedure, as the EP has publicly endorsed it as the most democratic way to proceed. Nevertheless, its ability to inspire greater commitment to EU governance is highly debatable. Thus, neither of these institutional ideas should be regarded as a panacea to Europe’s woes.

The second challenge – negotiation of the Multiannual Financial Framework (MFF) beyond 2020 – may sound like dull budget talk, but in reality has immense political implications. Determining the budget equates to policy prioritisation. This is important firstly because there are two major gaps: the absent (and substantial) contribution of a departing UK, and increased expenditure on new policy issues, such as security, border control and defence. Despite Germany’s willingness to increase its own contribution to the EU budget, it is unlikely to find the required consensus among the other member states. The Commission will propose to finance these two gaps partly by savings and partly by increased contributions. But even if the member states would be willing to increase their payments into the EU budget, significant cost-cutting would still be required.

This exercise in turn would make the re-prioritisation of EU policies indispensable. In which policy fields can the EU provide the most added value? A particularly difficult question is what to do with the EU’s traditional policy fields of agriculture and cohesion, which alone currently account for three-quarters of the overall EU budget. Are such commitments still appropriate and justifiable? By defining policy fields of European action, leaders are essentially shaping the future of the EU.