First use of the European Union Act 2011

The Foreign Secretary has today made a statement to Parliament which explains the Government’s first use of the European Union Act 2011. This use of the Act is required by the proposed treaty change to enable Eurozone countries to set up the European Stability Mechanism, which aims to secure economic stability in the Eurozone countries (not including the UK).

The European Union Act 2011 requires a referendum in the UK if this – or any future Government – agrees to a new European treaty, or an amendment to existing treaties which transfers powers from the UK to the EU.

Our assessment, explained in the Foreign Secretary’s statement, is that the treaty change to enable the establishment of the European Stability Mechanism does not require a referendum in the UK, as it affects only the 17 countries which are members of the Eurozone, and not the UK itself.

Economic stability in the Eurozone is of course in the UK’s interest, as over 40% of our exports go to Eurozone countries. Prolonged economic instability in the Eurozone would be bad for British prosperity and growth, which is why we support the introduction of the ESM.