The EU question

09 June, 2016

Alan Halsall, a successful businessman and board member of the ‘Vote Leave campaign’, then presented his arguments for a Brexit. “I see massive youth unemployment; in many countries more than 50 per cent. I see economic growth in the EU from 2008 to 2015 stuck at 3 per cent, while the US over the same period has grown 25 per cent and the Chinese economy has doubled. I see Finland wanting a referendum on the Euro, and Poland recently warning Germany and the wider EU not to intervene in their affairs. I see Portugal in a constitutional crisis, Spain with no government and Holland voting against the EU-Ukraine trade deal. I see the more extreme right-wing parties all over Europe becoming more and more powerful because I think they feel that their voice has been forgotten amongst the unelected European ‘oligarchs’ and the centralisation of power into Brussels. I look at worrying political moves in Hungary, and we haven’t seen the end of the euro crisis for Greece with its continuing weak economy and increasing unemployment. We now have the only opportunity to leave the EU that we will have in our lifetimes. We haven’t had such an opportunity since 1975 and I think that we should take it.”

Richard Butler, director at the CBI responsible for the West Midlands and Oxfordshire, then made the point that many business organisations, including the CBI, have conducted polls of their membership and the vast majority are in favour of staying in the EU. In terms of the perceived benefits of staying in the EU, Butler said we have unfettered access to a trading bloc of over 500 million people. “No other external country other than those within the EU has the same unfettered access,” he remarked, adding that the UK has access to trade deals via the EU with 50 other countries and explained that if we were to leave the Union, these deals would have to be renegotiated. “Our net cost of EU membership is between £9 and £10 billion a year – various studies show that the net benefit to the UK is between £2,500 to £3,500 pounds per household, which equates to between £70 and £90 billion,” continued Butler.

He considered that overall, business concerns about leaving primarily revolve around risk, uncertainty, potential loss of access to various markets and the resulting need to renegotiate those trade deals. Moreover, Butler stressed that the UK would have to have some kind of relationship with the EU even if we were to leave. Therefore, both personally and on behalf of the CBI, he stated that he believed the UK should remain in the EU.

Allie Renison, head of Europe and trade policy at the Institute of Directors, believes one issue that should be borne in mind – both as individuals and as people in business when voting on 23 June – is counterfactuals. “I can list a number of EU regulations that IOD members don’t like, but I think we need to ask the question, ‘How likely is it that the talk of existing legislation that has been transposed into EU law is going to change; including social and employment law?’ A lot of that is now sewn into UK national statute – in jurisprudence through the courts, for example. Similarly, the benefits that the EU has brought in terms of enforcing competition and non-discrimination – are those really suddenly going to evaporate for businesses? Some may, others are less likely to.”

Another point Renison made was that when standards are being developed for different industries, representatives from these industries want to be in the room when they are being developed because of the potential impact that the standards will have upon their industries. She noted that for heavily regulated industries, the UK ‘being in the room’ was important to businesses both big and small, not least because of the likelihood that the British government would continue to follow those standards. Renison did explain however, that the IOD is neutral on the Brexit issue and that, on a personal note, she didn’t believe there were sweeping arguments either way.

The floor was then given to Professor Richard Whitman, visiting senior fellow of the Europe Programme at Chatham House, Professor of Politics and International Relations at the University of Kent and a Senior Fellow on the Economic & Social Research Council’s ‘The UK in a Changing Europe’ initiative’. Professor Whitman reflected that there was a lot of information available, but not always in forms that are easily digestible and accessible. “Many people are not used to picking through the figures that are available and being able to make judgements about whether, for example, a Canadian style trade deal or a Swiss trade deal is better for the UK than the current arrangement,” he said. “That’s why the campaigns are important. However, the campaigns have tended to fall back on the fairly old model, which is to rely upon politicians. The Prime Minister has become the lead campaigner for the ‘Remain side’, which I think is inevitable. Unfortunately, much of the coverage now appears to have been set up as a kind of proxy battle for the future leadership of the Conservative party.”

Professor Whitman considers that there are problems in terms of presenting a coherent alternative vision for membership of the UK. “It’s quite easy to posit the cost that may be associated with leaving, but it’s very difficult to measure this against the alternatives,” he said. Of course, the EU debate could run and run; but whatever the outcome after 23 June I hope and trust that it will be the right one for UK plc.

Ed Holden

Editor