Tomorrow, October 7th, will be an important day for Britain’s future prospects of remaining in the EU, if the Conservatives again lead a government the next election. Jonathan Hill, the former leader of the House of Lords, who has been put forward by Jean-Claude Juncker as commissioner for financial services in the next Commission, is being recalled to Parliament to face further questions, the only commissioner to have been recalled so far although there are question marks over a few others). The reasons for his recall include the fact that he will have to learn quickly since he is not an expert in financial services, although he answered all the questions competently. Apparently controversially he said he had no view on eurobonds or taxation, but these are both matters with which he will be primarily responsible and which are highly political so any non-anodyne remark would have been likely to have been criticized. While some of Mr Juncker’s selection of commissioners are highly expert such as the transport and health commissioners, Maros Sefcovic (Slovakia) and Vytenis Andriukaitis (Lithuania), there are others without significant experience such as the environment commissioner, Karmenu Vella (Malta) or who have little experience and the energy commissioner, Miguel Arias Canate, has had experience mainly with the oil sector on which he will be supposed to reduce dependence.
There is actually a good case, given the failure of practitioners with high levels of expertise to have spotted the weaknesses in banks and other financial companies, for someone coming from the outside with a fresh, common sense approach.
Mr Hill, coming from a country outside the euro zone would not be best suited to have a major role in running the euro zone banking union. But supervision of banks will be the responsibility of the European Central Bank and with regard to legislation, Parliament has already agreed to a flawed compromise on winding up unviable banks. Any future legislation will be determined primarily by what is acceptable to member governments rather than anything the Commission does.
The fact that the UK is able to act as the financial services centre of the whole EU,including the euro zone despite not being party of the euro zone, is potentially controversial. Nevertheless, it is accepted that a fundamental principle of the EU is free competition throughout member states. Given that Mr Juncker has put forward Mr Hill as an olive branch to the British following David Cameron’s unjustified attacks on Mr Juncker’s own appointment, his rejection would be seen widely as a slap in the face for both Mr Juncker and the British government which would create very unfavourable conditions for the referendum on EU membership which any Conservative led government intends to hold in 2017. The recall of Mr Hill probably reflects political maneuvering within the European Parliament. From one point of view it might be argued that the UK government can hardly complain since its own EU policy is largely formulated as a result of political maneuvering to try to hold together the Conservative Party and head of the threat to the Conservatives from the UK Independence Party. However, Parliament will have to consider the huge potential consequences that a rejection of Mr Hill could have for the UK’s continuing membership of the EU.