The United Kingdom

36 Pages Posted: 12 Oct 2014

See all articles by Piet Eeckhout

Piet Eeckhout

University College London - Faculty of Laws

Michael Waibel

University of Cambridge - Faculty of Law; Lauterpacht Centre for International Law; University of Cambridge - Jesus College

Date Written: February 7, 2014


A range of complex factors affect the writing of a national report, from the UK perspective, on EMU governance questions. The first set of factors concerns the inherent complexity of the EU response to the financial crisis. A broad mixture of legal instruments have been employed, partly on the basis of the EU Treaties, but also partly outside the strict EU law framework. Those instruments involve the EU institutions, the Member States, but also novel institutions and bodies, such as the EFSF and the ESM. It is, indeed, trite that the EU's current economic and monetary governance system is a result of a lot of ad hoc bricolage.

A second layer of complexity is a function of the UK's very special position vis-à-vis EMU governance. Here is a Member State with a permanent opt-out from the single currency, with no prospect of ever joining the euro on any perceptible political horizon. It is a Member State which refuses to participate in the construction of a Banking Union, but which depends on its financial services industry for prosperity and has a keen interest in the internal market for such services, and in protecting the City of London as a global financial centre. It is a Member State whose current government subscribes to austerity, but has declined to sign up to the Treaty on Stability, Co-ordination, and Governance (hereafter referred to as the Fiscal Compact). It is a Member State which preaches greater EU flexibility, but dislikes that EMU governance may be shifting towards the Eurozone, with the attendant decision-making confined to the Eurozone Member States. It is a Member State with a strong economic interest in a thriving Eurozone, but which stands on the sidelines watching the construction of the Eurozone’s governance system.

A third element making the writing of this report more complex is the unsettled nature of the emerging governance system. It is true that, at the start of 2014, many parts of the system have, in political terms, been put in place. But for purposes of a constitutional and institutional assessment, from a legal perspective, the system continues to be in its infancy. Many legal instruments are not yet finalised, others have hardly been implemented as yet, and important case law is no doubt still to come.

In the face of this range of complex factors, the aims of this report are modest. It is not our intention to analyse every conceivable issue regarding the UK's position towards EMU governance. We aim to discuss some of the main issues, with a view to introducing, and occasionally clarifying, the core debates. We do this from an academic perspective - as academics based in the UK (but not UK nationals!). With that hat on we do not shy away from personally commenting on some of the constitutional and institutional questions which the new system of EMU governance throws up. For a couple of those, the "UK" perspective is present in the sense that those questions have also been considered by other UK academics. Obviously, we also aim to refer to the "official" UK government position, where there is one. But we feel that it is equally important to take on board the views expressed in the wider UK political, financial, and indeed academic community.

Keywords: European Monetary Union; Pringle; European Central Bank; governance reform; Six-Pack

JEL Classification: E61

Suggested Citation

Eeckhout, Piet and Waibel, Michael, The United Kingdom (February 7, 2014). Available at SSRN: or

Piet Eeckhout

University College London - Faculty of Laws ( email )

London WC1E OEG
United Kingdom

Michael Waibel (Contact Author)

University of Cambridge - Faculty of Law ( email )

10 West Road
Cambridge, CB3 9DZ
United Kingdom

Lauterpacht Centre for International Law ( email )

5 Cranmer Road
Cambridge, CB3 9BL
United Kingdom

University of Cambridge - Jesus College ( email )

Jesus Lane
Cambridge, CB5 8BL
United Kingdom

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