Deborah Waddell, assistant director at the CBI in the South West, explains why 80 per cent of businesses say staying in the European Union is vital to the UK’s economic success
BRITISH business large and small is clear – staying in a reformed European Union will be fundamental to UK economic success in the years ahead.
The CBI speaks for many thousands of companies and eight out of 10 say we must stay in the EU to help create the jobs and economic growth that we all want to see.
Our research suggests membership is worth up to £78 billion every year, roughly the size of the economies of the North East and Northern Ireland combined. That translates to nearly £3,000 to every British household.
Ahead of vital European elections, it is time to make the case that this is not a club we should be walking out of any time soon.
While there are some genuine frustrations with the EU, the benefits of membership to British business significantly outweigh the costs – and it is those benefits that help to create jobs in firms across the peninsula. Access to the EU single market has been crucial for ambitious British firms and means they can be part of incredibly large supply chains, which span Europe and are worth billions of pounds.
It may not be immediately obvious to people or companies not involved in exporting, but even the smallest local firm can often find themselves linked to these European supply chains indirectly via other business customers or suppliers – so retaining our membership of the EU will be vital for those many smaller firms who make up the backbone of our economy.
For consumers, being in the EU and part of the single market means more products and services on offer, and at lower prices, alongside common standards that has led directly to safer and more environmentally friendly products, from your car to the medicines in your bathroom cabinet.
And yes, we do need to sell more of our great products and services to the far-flung, fast-growing markets of the world, like China and Mexico. But we cannot forget just how important Europe is to us.
Not only do half our exports go to the EU – and no amount of selling to India or Indonesia will change the fact Europe is our closest market – it is the EU negotiating big trade deals with other countries that helps get British firms into these new markets. We just would not carry the same weight when negotiating deals as a country of 60 million people, rather than a market of over 500 million.
The UK economy has benefited from access to talent across the EU and from immigration more widely. While the long-term answer to a growing skills shortage is to improve the education system and training provision, we cannot ignore the fact freedom of movement in Europe has helped our businesses thrive.
Of course we need a migration policy that ensures we avoid negative social impacts on people, but we cannot afford to send a signal that Britain is closed for business. It works the other way as well, with UK nationals having great opportunities to live, work, study and retire in Europe – out of reach for most people only a few decades ago, but taken up by more than two million today.
The UK could of course survive outside the EU, but none of the alternatives offer a better or more prosperous deal.
The test for those pressing for our departure is to come up with a clear vision of what that future will look like. Whether we are in or out of membership we will still need a close relationship with the EU. But countries like Norway and Switzerland, who have looser ties to the EU, simply do not appear to have set-ups we should aspire to.
They are halfway houses on the margins of Europe with no influence over the market rules into which they sell their goods. For example, Norway still pays the bills to have access to the single market but has as much of a say on the rules as Liechtenstein, which is not my idea of greater sovereignty and would prove unacceptable to the British public.
But the EU must reform its priorities and renew its purpose to keep pace with increasingly competitive international rivals. It must be outward-looking, signing more trade deals and breaking down trade barriers.
It is true the EU’s authority has crept into areas and issues where national parliaments are better placed to make decisions, which must be challenged, no question.
We must start from the point of “Europe where necessary, national where possible”.
However, there is a head of steam building across Europe for reform. It is achievable, it is in our national economic interest and it will create jobs and opportunities at home in the future. To reap the benefits of these reforms, we need to be getting stuck in to achieve change, not hovering at the exit door.