This is the basis of a post on one of of our forums I wrote last year in response to the question of “What happens if the UK leaves the EU”. I have updated it a little as I talked about the general election, but I think the content is still relevant.
I think this is an interesting question. If you had asked me that 9 months ago, I would have said that the UK would probably join the EEA (European Economic Area).
The requirements to be a member of the EEA require the inclusion of EU legislation in all policy areas. This covers the four freedoms, i.e. the free movement of goods, services, persons and capital, as well as consumer protection, company law, environment and social policy. The EEA Agreement guarantees equal rights and obligations within the Single Market for citizens and businesses in the the EEA.
It does not cover the following EU policies: common agriculture and fisheries, customs union; common trade policy; common foreign and security policy; justice and home affairs, direct and indirect taxation; or economic and monetary union.
However, that was when the debate was about sovereignty and getting powers back from the EU.
There was a speech in November 2014 by the Prime Minister, in which, whilst accepting the principle of the Freedom of Movement within the EU is looking to apply different rules for benefits for EU citizens working in the UK. In addition he wants EU citizens who come to the UK, but are unable to find work to return home after 6 months. This seems to be the same position today, together with lots of other things. Now I think there are some things he can already do that are within the existing rules, but one thing you cannot do is discriminate. That is a fundamental principle of the EU. So, even though the policies of the UK are more generous than other countries, it requires a specific agreement to be able to do these things. It seems to me that these, in particular, are lines in the sand. So, if there are no changes to these policies that are acceptable the UK may vote to leave the EU.
Interestingly, there was an EU ruling on the 6 months issue in 1991, which as far as I can see is still valid today. the ruling said :
“in answer to the questions submitted to it by the High Court of Justice, Queen’s Bench Division, by order of 14 June 1989, hereby rules:
It is not contrary to the provisions of Community law governing the free movement of workers for the legislation of a Member State to provide that a national of another Member State who entered the first State in order to seek employment may be required to leave the territory of that State (subject to appeal) if he has not found employment there after six months, unless the person concerned provides evidence that he is continuing to seek employment and that he has genuine chances of being engaged..
So, on the basis that free movement of people and social policies still apply to members of the EEA, with no influence on the creation or direction of these policies, I cannot see that it would be tenable.
So, if the UK leaves the EU and doesn’t join the EAA, what are the options. Well, it seems to me that there are only two.
The first is that the UK is treated like any other non EU country, so this may mean requiring entry visas, more detailed examination of why you are visiting the county, and whether you have the resources to support yourself. UK citizens who are already living in Spain, and have been registered as resident for 5 years would be able to apply for permanent residence, but the rules on family joining them are much stricter. These are just a few examples.
The second is that there is some sort of cobbled deal somewhere between the two. My guess is that this would probably be the outcome, but what it would look like is anyones guess.
How this would affect health and state pension increases is a bit easier to predict.
With the first option, the EEA then there would be no impact, as it is effectively a requirement of EU social policy.
The third option, complete independence, would in my view mean health may be withdrawn and that pensions would be treated as any other overseas country, in other words they would be frozen. I cannot see any other option, as to not adopt the existing polices would mean they would have to pay for health and pension increases across the board, and there would be plenty of expats outside the EU queuing up to claim their rights in court. Having said that it could be phased out over a period.
The second option, the cobbled deal, would really depend upon which policies they agreed to honour. There would obviously be pressure from within the EU to honour the health aspect, to alleviate the potential burden on other member countries. Whether they would be as fussed about pension increases, I’m not so sure.
Anyway, those are my musings about the likely scenarios.
Its looking likely that there will be a referendum sooner rather than later, with the Referendum Bill expected to be announced in the Queens speech tomorrow, and Mr Cameron having a number of meetings this week trying to lobby support. Interesting to see how it plays out but I suspect there will be a lot more tanks on the lawn, and brinkmanship before we are in the end game.
I think one of the big worries if you are a EU national living in Spain is the uncertainty, because at the end of the day, there is, unfortunately, not a lot you can do until it has played out.
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