There are five main areas which the EU has been pursuing in order to establish what it calls an ‘EU Defence Union’ across the 28 EU countries, including the UK.

  1. Procurement policy and incentives

  2. Finance

  3. Intelligence, Battlegroups and PESCO

  4. UK defeat over HQ

  5. Contradicting statements over UK involvement.

Since 23rd June 2016, the UK has made commitments in each of these above areas of defence with no debate in the British Parliament. Each one is described in more detail below:

  1. Procurement policy and incentives

The UK has agreed to…

  •     More power for the EU to enforce EU-wide tendering in defence contracts
  •     An expanding remit for the EU over defence industrial strategy and joint-built assets
  •     An expanding remit for the EU in purchasing and conduct of joint-owned assets
  •     Incentives for UK defence companies to engage long-term with the developing EU-wide industrial strategy

The only reason the UK is permitted to build its own aircraft carriers is by using an exemption to the EU Procurement Directive. The exemption is known as the security clause (Article 346) and is permitted when a member state feels there is a national security reason to reserve production for its domestic market. The European Commission is tightening application of the clause following a review in 2016 and has gained the consent of member states to do so. (EU Council Conclusions, 14 November 2016)

The EDA and EU Commission have a benchmark of achieving 35% pan-EU equipment procurement.

UK ministers have approved measures that allow the European Defence Agency to have a greater role in standardisation and certification. (EU Council conclusions in Security Defence, 18th May 2017)

These measures would amplify EU influence in the trading conditions of the defence sector and an additional tool for the enforcement of policy. For example, certification and mutual recognition of standards might be used as a barrier to entry to UK exporters in years ahead in the same way that EU ‘standards’ produce a barrier to non-EU exporters in other sectors. Conversely, certification and standards could be used as an incentive for UK manufacturers and policymakers to adhere to EU policy. Either way, the changes bring a measure of additional control to the European Commission.

The EU refers to EU defence industrial strategy as the European Defence Technology and Industrial Base (EDTIB) and has more recently started using the term ‘Single Market for Defence’. With the objective of ‘reducing duplication, the EU intends to integrate this market under coordinated joint projects and an EU-controlled policy environment. The aim is for the resulting combined EU defence industrial strategy to serve the needs of the EU’s ‘new level of ambition’ in a military context.

This above agreement on standardisation and certification is an additional method of directing the integration of the EDTIB beyond the two already mentioned previously: 1. enforcement of the pan-EU Procurement Directive and 2. financial incentives via the European Defence Fund.

The EU Commission could conceivably tell the UK after Brexit that ‘access’ to its newly coordinated ‘Single Market for Defence’ requires adherence to the Procurement Directive. Also, now that UK participation in the European Defence Fund’s imminent incentive programmes is being concluded, UK ‘withdrawal’ could be viewed by the EU as an act that warrants retaliation or requires UK concessions.

  1. Finance

The UK has agreed to…

  •     The creation of the EU’s first central military budget, the European Defence Fund
  •     The use of European Investment Bank money (16% UK shareholding) for the European Defence Fund
  •     The creation of a Cooperative Financial Mechanism (CFM) to augment the European Defence Agency
  •     The creation of a Coordinated Annual Review of Defence (CARD), a mechanism which sees the EU offer financial incentives for adherence to EU planning over member state defence budgets.

The European Defence Fund will begin with a budget of only a few billion euros, but this money will be dangled in front of policy makers and defence companies to steer them towards joint activity and a policy environment that is under EU authority.

Millions of euros have already been placed into an “unprecedented level of engagement” with defence companies including defence industry conferences in the UK financed by the EU Commission, which started in April (Southampton) and are continuing throughout 2017 (Bournemouth etc).

UK companies are being invited to bid for the first tranche of European Defence Fund money in June 2017, via an EU Commission / EDA programme known as PADR (Preparatory Action for Defence Research). The programme is even being promoted by the UK Defence Solutions Centre, a UK-Government-funded unit which was formed to boost output of UK defence companies.

According to the EU Commission and EEAS, the Cooperative Financial Mechanism “will strengthen the European Defence Agency” as a central EU defence capabilities tool. The mechanism appears to be separate to the European Defence Fund. It is designed to manage member states’ money in a joint budget and will be spent on EDA research projects, military units conjoined under Permanent Structured Cooperation and joint assets.

This added financial firepower for the EDA overrides many years of policy by UK ministers who argued that the EDA’s scope and budget should be restricted. (European Defence Agency ministerial steering board, 18th May 2017)

The UK Government has a 16% (EUR 39 billion) stake in the EIB, the same as Italy, France and Germany (the four largest shareholders). The EU Commission is changing the lending criteria of the EIB to ensure it supports the European Defence Fund. The EIB is an instrument of the EU and operates in adherence to EU policy. There has been no confirmation of whether the UK will withdraw from the EIB, but to remain a shareholder would mean a level of participation in EU policy. The EIB has placed funds into infrastructure projects in the UK including Crossrail and the Manchester Metrolink.

The UK’s consent to EIB funding for UK defence industries provides the EU with additional locks on UK participation in EU defence policy and on its EIB shareholding. These additional locks were made after the UK’s referendum on EU membership and add to the task of unravelling these links after Brexit.

  1. Intelligence, Battlegroups and PESCO

The UK has agreed to…

  •     An increased size, scope and infrastructure of the EU’s military intelligence agency as a central ‘hub’.
  •     Participation in a 2019 EU Battlegroup under EU Council control. Approval given pre-referendum. No confirmation from MOD about whether it is cancelled or continuing.
  •     Drop objections to Permanent Structured Cooperation (first version of permanent military unification) by willing member states. MOD will not confirm whether the UK is staying out or not.

The European External Action Service (the EU’s ‘foreign ministry’) has put forward plans to grow the role of its intelligence agency known as the Single Intelligence Analysis Capacity (SIAC). (EU Council conclusions in Security Defence, 6 March 2017 and 18 May 2017).

SIAC is composed of the EU Military Staff Intelligence Directorate and the ‘civilian’ EU INTCEN. The EU Council agreed to develop them as an EU “hub for strategic information, early warning and comprehensive analysis”.

Member States, including the UK, have been asked to consider initiatives and ways to interact with these plans. (Security and Defence Implementation Plan, 14 November 2016).

The UK was scheduled to lead an EU Battlegroup in Jan-Jun 2019. The MOD will not state whether Britain’s participation will be cancelled or proceed.

 

Part Two, focussing on the UK’s involvement in EU “defence”, will follow on UKIP Daily

By David Banks. With thanks to The Bruges group and the Campaign For An Independent Britain, on whose websites this appeared previously.

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