UK / EU Referendum

The UK’s place in the world compared with others:…….

UK’s special features
The UK has many features which have a bearing on how we are viewed in the world.
Our language is the world language. We are on GMT. Our money the pound is a freely traded major currency. We are a small island off the mainland of Europe. Historically we controlled the British Empire overseeing about 20% of the world’s population, but no longer. Today the UK has no substantial overseas territories. The UK is seen as the most honest and democratic nation on earth. The UK is a nuclear power. It a member of the UN and on the UN security council, and a member of Nato, EU (Schengen & Euro excluded), and G7 plus many more institutions. We are a prosperous high cost, high wage economy with a very generous social security system. Negatively we have lost most of our heavy low tech industry over the last 30 years – coal, shipbuilding steel, basic chemicals, textiles.

UK Economy
The UK is very much a consumer society sucking in huge volumes of imports. We currently have a national debt of £1,695 billion and a trade deficit in goods of about £140bn/annum offset by a surplus in services of about £80bn/annum. Interest on our national debt is about £47bn/annum.
Conclusion: With our huge deficits, management of the UK is tricky and caution must be exercised.

Trade
As a member of the EU we have open access (nil tariff) to the EU market of 508 million people. We can also trade with all other nations in the world but with varying tariffs. We currently run a trade deficit of about £60bn/annum – this external deficit is currently balanced by inward investment and borrowing from overseas. To go it alone would be risky, take time to negotiate trade agreements and there would be no gain, only loss. We are already trying hard as a country to sell our goods throughout the world and as an experienced international trader I know sales outside the EU cannot be easily or quickly increased. The UK is a major exporter of financial services and London is the envy of Frankfurt/Berlin/Paris. If we were to leave the EU then there would be a huge effort by both Germany and France to block our export of financial services and move the centre of that trade to either Germany or France.

Inward Investment
Companies invest in the UK for 2 reasons: (a) to sell to the UK market and (b) to sell to the huge EU market. If we were to leave the EU, companies wanting to sell to the EU would more likely invest in the EU eg Poland, Germany, Czech, Slovakia etc. To lose this inward investment would result in the value of the pound dropping by anything from 10% to 45% and interest rates going up to attract overseas purchasing of UK debt.

Politics
The EU has over the last 30 years become more and more political. This was inevitable for 2 reasons:- (a) as a trade bloc – regulations had to be brought in to apply to all 28 nations concerning goods – quality, packing, naming, etc (b) with the expansion of the EU to include the poorer West European countries of Ireland, Portugal and Spain and with the collapse of the Berlin wall the former East European countries of Poland, East Germany (now Germany), Czech, Slovakia, Romania, Hungary, Bulgaria etc all of which were poor, funds had to be transferred from the rich west to the new counties in order to assimilate them. This was a noble enterprise. The EU is now largely prosperous so it can be concluded this process was correct. Also Europe’s border with Russia has effectively moved eastwards by about 500 miles since 1990. This is comforting. The UK is the second strongest country in the EU after Germany and we have a duty to play our part in keeping the EU strong and supporting all the new members bordering Russia / Belarus / Ukraine. Administration: the day to day operations of the EU are managed / controlled by the EU commission – an unelected body. Many don’t like the lack of accountability but with 28 nations an effective administration is necessary. Oversight of the commission by the elected EU parliament and Council of Ministers should be tightened – we need to play our part in this negotiation

Immigration
One of the founding principles of the EU is free movement of EU citizens throughout the EU. The UK has gained from this by accessing skilled labour from Poland and also UK citizens living and working in the EU have gained by having full access to the services of the recipient country namely healthcare, schooling and ability to work. The EU is currently having a major problem with immigration from outside the EU – namely people travelling without an EU visa and gaining access by claiming asylum. The numbers have overwhelmed the EU and thousands of EU passports have been issued without proper checks especially to people arriving from Syria, Afghanistan and Libya. The rules are being tightened and the UK needs to play its part with this process. The UK has its own independent border control (as we are not a member of Schengen) but have to obey EU regulations. However we could bring in and enforce two new regulations and still remain in the EU
1. Security: if someone tries to enter the UK on a newly issued EU passport our default position should be refusal until security has been checked.
2. All people leaving the UK and the EU must be recorded at passport control and if they travel to a hostile country such as Syria then on return to the UK even with a UK passport they would be refused until security checked. This would require the cooperation of Turkey and other 3rd part countries.

Security
Sharing information with our EU partners is crucial to our fight against terrorists. Only admitting asylum seekers or new EU entrants after extensive security checks is very important and must be implemented.

EU oversight
Many complain about the EU poking its nose into our affairs but much of the EU regulation is good – eg environmental oversight, because the environment is a world problem it is far better to be managed regionally.

Jobs that are 100% EU dependent
We have a least 250,000 jobs that would go if we left the EU. These range from UK people directly employed by the EU to many that are dependent on EU funding eg in the overseas aid business, DEFRA and environmental work.

Cost of EU membership
Taking into account EU investment in the UK and our EU rebate the nett cost is around £8bn/annum out of total government & local authority spending of £760bn – about 1%. If the UK were to leave the EU the saving would be tiny as we would have to pay a fee in order to access the EU market tariff free. Also we would lose our rebate.

Leave EU / Brexit
The pound would drop. Inflation would go up. Interest rates up. Unemployment up. Lower wages. Fewer jobs. Many businesses would close. The UK would become isolated and be on a long term path to nowhere. If we did leave I would recommend we apply to join EFTA.

Remain / Stay in the EU
After a vote to remain the UK would bounce back as its economy has been supressed by the uncertainty of the referendum vote. The pound would strengthen. Investment would go up. Inward investment would resume. Confidence would return. Growth would go up. The UK would resume its rightful place at the centre of the EU and help to shape its future. The UK would also play a major role in representing the EU in all worldwide negotiations with Turkey, Syria, Russia, USA, China etc and also help tackle the major EU problems of immigration and security.

Conclusion
The upside of staying in the EU far outweighs the risk of leaving. Vote: REMAIN.