Towards the EU Referendum (1994)

The path to integration in 1994 was dominated by three interrelated themes: negotiations with the European Commission on Finland’s EU membership in the spring of 1994, the EU referendum in the autumn of 1994, and the steady consolidation of the EU stances of the major political parties. With regard to the negotiations with the European Commission, the central policy of the Finnish representatives was to secure an agricultural subsidy package, which was needed in the domestic market to support Finnish farmers. This package was important to the Centre to ensure that the majority of its supporters would vote for EU membership in the referendum, and also to guarantee a majority in Parliament. Alho claims that the government emphasised agricultural affairs, but, on the other hand it did not debate on EMU or its advantages in the Cabinet Committee on EU Affairs (Alho 2002, 119).

6 The position of the party congress of the SDP 4.6.1993.

7 The position of the party congress of the NCP 11.–13.6.1993

8 The position of the party congress of the NCP 11.–13.6.1993.

Finally, the European Parliament announced its approval of Finnish membership in May 1994 and the parties signed the treaty in June 1994. The next step was the national referendum to which the government had committed itself when submitting the application. Emotions were stirred up before the referendum, which was held in October 1994. One of the major themes of the debate concerned the order in which the referendums were to be held in the three Nordic applicant countries. Many groups opposing Finnish membership demanded that the Finnish referendum should be held either simultaneously with or after the corresponding Swedish referendum, and not prior to it as planned.

The consultative referendum was held in October 1994, with 57.1 per cent of voters supporting membership: turnout was 74 per cent. Consequently, the Finnish Parliament approved EU membership by a vote of 152 to 45. As far as the party positions to EU were concerned, Finnish European policy was, in general, pro-integrationist. For instance, all the major parties - the SDP, the Centre and the NCP - were officially supportive of EU membership. As shown in Figure 5, the only one in which the voting behaviour of its supporters contradicted the official party line was the Centre, with just above one-third of supporters favouring membership.

Figure 5: The Percentages of Voters in Favour of EU Membership in the 1994 Referendum

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Yes to EU membership No to EU membership The percentage of voters

Sources: The party-affiliation figures are adapted from Paloheimo 2000, 58.

Only 36 per cent of the Centre supporters voted for EU membership in the 1994 referendum, and accepted the Maastricht Treaty without any major opt-out clauses or policy exemptions. Scholars tend to argue that the decision to follow the example of Sweden and submit an application for EU membership was based on political consensus (Raunio & Tiilikainen 2003, 39): for instance, all of the major political elites (including the party and interest-organisation leadership), the media and the key players in the private sector were in favour.

Four main factors seem to have encouraged support for EU membership: the majority of Finns mentioned economic reasons as the most important factor, followed by influence, culture and security.

A large number of those who were against membership could not give a reason for their opposition.

Paloheimo discovered that the conservative and social-democratic parties in all three Nordic countries

supported membership, the voters belonging to conservative parties being more united in their support than others. The Centre in both Finland and in Sweden supported membership but with reservations, although the majority of their supporters voted against it (Paloheimo 1995, 113–127). The supporters of the NCP seemed to constitute the most coherent group in terms of following the party line, with EU support averaging more than 80 per cent. For instance, the central policy of the party congress was to emphasise economic and monetary co-operation as a factor that would increase stability in the market and thus be beneficial for Finland.⁹ Later on the party council declared that EMU would bring a balanced economy and more employment.¹⁰

The main party in the government, the Centre, was deeply divided with regard to the results of the referendum. For instance, only 36 per cent of its supporters favoured membership, with the majority of the leadership and voters living in the southern cities voting “Yes”, while those in the countryside voted

“No”. In particular, the party leader and prime minister Esko Aho was able to persuade some of the opponents to change their opinion. There were differences between the official positive party line and some of the opposing supporters. Interestingly, a crucial role was played by Aho, who strongly influenced the core supporters to vote in favour of membership at the party congress in June 1994. He even threatened to resign if the party decided to oppose it. As a result, the party congress gave its backing and a favourable decision was reached by 1 607 votes to 834.¹¹ The party emphasised both the advantages and disadvantages of EMU in its positions in 1994. On the one hand, the then Minister for Foreign Affairs, Heikki Haavisto declared in his speech that the EMU criteria were in line with the objectives of Finnish economic policy.¹² As an EMU member state Finland would be able to keep inflation and the interest rate, the budget deficit and the state debt at the same level as other EU member states. Haavisto used expressions such as “stable currency rate”, “competitiveness” and

“employment” as major beneficial factors if Finland joined the EMU.¹³ Later on the executive committee took an identical supportive position, but emphasised that Finland should decide separately on EMU.¹⁴

Meanwhile, the SDP was in opposition and its core supporters also remained divided in spite of their party leadership’s positive stance. The SDP electorate was more sceptical, as only 75 per cent of the voters voted in favour of membership in the referendum. The party supporters were still divided into three camps in September 1994: “Yes”, “No”, and those yet to make up their minds. This was problematic for the party leader Paavo Lipponen, who had been one of the first to publicly speak in favour of EU membership. The leading organs of the party had unanimously supported not only EU but also EMU membership. The central policy of the party was to support EMU as the right objective in

9 The position of the party congress of the NCP 27.–28.8.1994.

10 The position of the party council of the NCP 21.5.1994.

11 The protocol of the party congress of the Centre 17.–19.6.1994.

12 The speech by Heikki Haavisto at the party congress of the Centre 17.6.1994. Haavisto was then the Minister for Foreign Affairs and responsible for the EU membership negotiations with the European Commission.

13 The speech by Heikki Haavisto at the party congress of the Centre 17.6.1994.

14 The position of the party executive committee of the Centre 22.9.1994.

the long run, and it also brought into the discussion the projected increase in employment.¹⁵ Eventually, the social democrats, who a month earlier had not yet formed an opinion, voted “Yes” in the referendum. Lipponen was determined to lead Finland into the inner circle of the EU. Finland, together with Austria and Sweden, joined the European Union in January 1995, just over a year after the Maastricht Treaty, which had quite fundamentally changed its nature, came into force.