Bloomberg News

Miliband Says Cameron’s EU Strategy Is ‘Incredibly Dangerous’

January 13, 2013

U.K. opposition leader Ed Miliband said Prime Minister David Cameron’s strategy on the European Union is “incredibly dangerous” as pressure for the government to renegotiate its membership terms intensifies.

“He is essentially sleepwalking us toward the exit door from the EU,” Miliband, the Labour party leader, said on BBC Television’s “Andrew Marr Show” yesterday. “It’s incredibly dangerous.”

Cameron, who is set to make a key speech on the U.K.’s relationship with Europe later this month, is under pressure from some members of his Conservative party to call a referendum on pulling out of the EU. The government’s language on Europe has hardened in recent days, with Chancellor of the Exchequer George Osborne telling Germany’s Die Welt newspaper on Jan. 11 that the 27-nation bloc will need to change if Britain is to remain a member.

Lawmakers from Fresh Start, a group of euroskeptic Conservative members of parliament, will call for EU treaty changes to help reset a range of powers covering crime, justice and policing, the Sunday Telegraph said yesterday, citing a copy of a report to be published later this week.

A ComRes poll commissioned by the Sunday People newspaper, published yesterday, showed the U.K. Independence party, which seeks Britain’s exit from the EU, gaining 23 percent support, more than double the share of the vote they received in 2009. The Conservative Party trails with 22 percent and Labour remains in the lead with 35 percent.

‘Incredible Gamble’

While 63 percent of Britons favor a referendum, support for outright withdrawal fell to 33 percent, according to the online poll of 2,059 people from Dec. 19 to Dec. 21.

“The last thing we should do is start to say that at some date in five or six, seven years hence let’s decide now to have an in-out referendum,” Miliband said. “That’s an incredible gamble.”

The U.K. shouldn’t commit to or promise a referendum on the EU, he said.

Philip Gordon, assistant secretary of state for European Affairs in President Barack Obama’s administration, last week warned Britain against a referendum, saying the U.K. staying in the EU is important to U.S. interests.

Chief Secretary to the Treasury Danny Alexander, a member of the coalition government’s Liberal Democrat party, told Sky News yesterday that “Britain should continue to be a leading member of the EU.” Still, he acknowledged that he couldn’t see Britain “joining the euro in the foreseeable future, if ever.”

Tax Avoidance

Separately, Miliband said a Labour government would crack down on tax avoidance by profitable companies.

“We’ll end the tax secrecy” where companies “can get away with making big profits and with no reason at all, no justification, not pay any tax,” he said. “We cannot have a situation where companies feel they can get away with not paying their fair share.”

The Treasury said last month it has closed a loophole in the corporate tax system that allows companies to deduct certain types of expenses from profit. The move followed a parliamentary hearing in November in which executives from Starbucks Corp. (SBUX:US), Amazon.com Inc. and Google Inc. were criticized for using complex accounting methods to reduce their tax liabilities in the U.K.

“We’ve got to look at the rules on how companies can distribute their profits,” Miliband said. “Other countries like Denmark have much tougher rules.”

To contact the reporters on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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