A few problems with Cameron’s latest four year benefits delay wheeze

The Telegraph reports that David Cameron is “closing on ‘four years’ deal on in-work benefits to deter EU migrant workers”, saying that such a deal “will allow David Cameron to claim victory on his key pre-referendum demand to curb benefits for EU workers”. The “deal” in question appears to involve the UK changing its benefits rules so those that have not lived here for for years as adults are not eligible for benefits regardless of whether they are UK citizens or not, so 18-21 year old UK citizens would not be eligible for benefits, but at the same time introducing a new benefit for 18-21 year olds.

My first remark on this is that “renegotiating the UK’s position within the EU” now appears to mean “asking the EU how existing EU rules already allow the UK to change its benefits system” – i.e. no change, not one jot or tittle, in the EU but lots of change in the UK. I’d describe that kind of “renegotiation” as “Cameron fought the Law and the…Law won.”

My next remark is that nothing I say above or below should be interpreted as meaning I support the objective of trying to deter EU migrant workers from coming into the UK, which as I’ve noted many times is as fundamental a part of the notion of being in the Single Market as it gets. It’s simply flat inconsistent to say (as Cameron does) one wants to be able to deter the free movement of labour and at the same time to stay in the EU. Neither do I agree that stopping benefits would make much difference to inflows of EU migrant workers to the UK when our job opportunities are so much better than elsewhere in the EU.

But let’s take the measure in its own terms for now. Let’s suppose we have a four year requirement for in-work benefits and an unconditional “18-21s” benefit. Obviously the 18-21s benefit would have to apply to EU citizens living in the UK as well as UK citizens, otherwise it would be discriminatory. So we might attract additional 18-21 year old migrant workers, but the numbers would probably be small.

The trickier issue concerns students. Presumably a UK citizen that studied at University in France would not be eligible for the UK 18-21s benefit and would have to wait until she was 25, upon returning to the UK, before being eligible for UK benefits.

I think that would be struck down, in due course, under Single Market rules as a non-tariff barrier preventing other EU Member State universities from marketing their courses to UK citizens on a level playing field with UK universities. If an EU citizen aged 18-21 coming to live in the UK automatically qualifies for an 18-21 year olds’ benefit (as I presume they must), that would make the non-tariff barrier even higher. There would be a clear incentive for UK and non-UK 18-21 year olds to go to university in the UK, so that they would get the 18-21 year olds’ benefit and also be eligible to get in-work benefits in the UK later. It would effectively be a large back-door subsidy to going to university in the UK.

Such striking down might not come any time soon. Member States currently have quite a lot of discretion in the financial support they provide to students. But I think it would probably come in the end, because the Single Market violation involved is so blatant and egregious.