‘Defend and extend’: British business strategy, EU employment policy and the emerging politics of Brexit
| Date | 01 November 2017 |
| Author | Scott Lavery |
| DOI | 10.1177/1369148117722713 |
| Published date | 01 November 2017 |
| Subject Matter | Articles |
https://doi.org/10.1177/1369148117722713
The British Journal of Politics and
International Relations
2017, Vol. 19(4) 696 –714
© The Author(s) 2017
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DOI: 10.1177/1369148117722713
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‘Defend and extend’: British
business strategy, EU
employment policy and the
emerging politics of Brexit
Scott Lavery
Abstract
As the British government embarks upon the process of exiting the European Union (EU), it
will have to navigate the preferences of powerful business interest groups. However, the British
politics and political economy literatures have tended to neglect the question of business agency
in general and its relation to EU integration in particular. This article analyses British business
strategy in relation to EU employment policy between 2010 and 2016. Through a document
analysis of business responses to the Balance of Competences Review on EU Employment Policy
and Confederation of British Industry (CBI) policy documents, the article argues that British
business has attempted to ‘defend and extend’ a liberalising agenda within the EU in the recent
past. Brexit fundamentally undermines this strategic orientation. The article accordingly outlines
some of the key strategic dilemmas which the ‘Leave’ vote generates for British capital within the
emerging politics of Brexit.
Keywords
Brexit, business, employment, European Union
Introduction
Leading sections of British business strongly advocated a ‘Remain’ vote throughout the
European Union (EU) referendum campaign. The Confederation of British Industry
(CBI), the CEOs of some of the United Kingdom’s largest firms and lobby groups based
in the City all stressed the risk which ‘Brexit’ posed to investment, skills and competitive-
ness. The shock ‘Leave’ vote in June 2016 therefore represented a major defeat for the
‘Remain’ campaign and for large swathes of British capital (Thompson, 2016: 114). In the
immediate aftermath of the EU referendum, the situation from the perspective of British
business seemingly deteriorated further. As sterling fell to a 30-year low, the new Prime
Sheffield Political Economy Research Institute (SPERI), The University of Sheffield, Sheffield, UK
Corresponding author:
Scott Lavery, Sheffield Political Economy Research Institute (SPERI), The University of Sheffield, Sheffield S1
4DP, UK.
Email: scott.lavery@sheffield.ac.uk
722713BPI0010.1177/1369148117722713The British Journal of Politics and International RelationsLavery
research-article2017
Article
Lavery 697
Minister, Theresa May, pivoted rhetorically towards an economic programme which was
widely condemned as inimical to the ‘business interest’ (Sands, 2016).
In this uncertain context, one of the key questions for analysts of British politics is how
British business might attempt to regain control of the domestic agenda and thereby shape
the Brexit process in line with its perceived interests. However, two obstacles stand in the
way of ‘mapping’ how British business might seek to achieve its objectives during the
course of the Brexit negotiations and beyond. First, the politics of Brexit is a ‘moving
target’ which is highly complex, evolving rapidly and embodies a wide array of compet-
ing social and political forces.1 Second—and more worryingly—the existing literature is
ill-equipped to interrogate the emerging relationship between British business strategy
and Brexit. This is because the British politics and, more surprisingly, British political
economy literatures have tended to neglect the question of business power and strategy
within the United Kingdom. As such, no comprehensive study of the relation between
business strategy, British politics and European integration has been conducted.
This article advances a distinctive account of British business strategy in relation to the
EU in the period before the June 2016 referendum.2 The article is organised around two
core questions. First, in what ways has British business attempted to secure its objectives
in the past within the EU? Second, how might Brexit problematise this strategic orienta-
tion? To answer these questions, the article focuses primarily on British business strategy
in relation to EU social and employment policy (EU S&EP). Since the signing of the
Maastricht Treaty, British business interest groups have argued that the growth of EU
S&EP threatens their freedom to control labour costs (Towers, 1992: 85). Focussing on
British business attempts to minimise the impact of EU S&EP, therefore, provides us with
a useful lens through which to identify British business strategy in relation to European
integration. Through a documentary analysis of business submissions to the Balance of
Competences (BOC) review (a 2013 consultation led by the Coalition government on
UK–EU relations) and of policy and strategy documents from the CBI between 2010 and
2016, the article argues that British business has attempted to ‘defend’ the United
Kingdom’s labour market regime from EU S&EP through deploying the formal and infor-
mal power of the British state inside the EU institutions.
This synthesis of British business and state power is in evidence beyond the field of
EU S&EP. As evidenced below, in relation to the Capital Markets Union (CMU) agenda,
British business also sought to utilise the power of British policymakers inside the EU in
order to advance their interests and to ‘extend’ liberalisation outwards. British business
interest groups have therefore historically attempted to ‘defend and extend’ a liberalising
agenda through deploying the formal and informal power of British policymakers inside
the EU institutions. The ability to influence the rules of the Single Market has been as
important to British business interest groups as access to the Single Market. This analysis
is suggestive of a series of dilemmas which now face British business interests as the
United Kingdom embarks upon the Brexit process.
The article proceeds as follows. The first section argues that the issue of business
agency has been neglected both empirically and conceptually in the British political econ-
omy literature. The second and third sections analyse the relation between business strat-
egy and EU S&EP, analysing how business interest groups—and in particular the
CBI—sought to deploy the power of the British state within the EU in order to ‘defend’
the United Kingdom’s flexible labour market from supranational upregulation. The fourth
section extends the analysis and argues that the United Kingdom’s position as a powerful
member state was also an important factor in the financial sector’s approach to the CMU
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