The CBI: Wrong Then, Wrong Now On Britain’s EU Membership

Now an In/Out referendum on Britain’s membership of the EU is guaranteed by the newly re-elected Prime Minister, David Cameron, it is open season for the Confederation of Business and Industry (CBI) to attempt to scaremonger the public into voting to stay in.

CBI President Sir Michael Rake told BBC News we must not opt for Brexit, in order to ‘retain’ our access to the EU’s Single Market to which we export ‘50% of ours goods’! This is very misleading.

First, Sir Michael conflates access to the Single Market with being a member of the European Union. To trade with the Single Market Britain does not need to be a satellite state of Brussels, nor be trapped in a political union with the EU. Turkey does not need to join the EU to trade with it, nor does it need to be in a political union to ensure the goods they sell will meet EU standards.

Secondly, it is worth knowing our trade with the EU is an ever smaller share of our international trade. According to recent figures from the Office for National Statistics, our trade with non-EU partners like South Korea and India rose by £0.7 billion to £12.8 billion in the months February and March this year. Meanwhile, our trade with the EU declined by £0.9 billion to £17.9 billion.

This follows a long-term trend of EU economic decline, as the rest of the globe begin to out-compete Europe and become eager customers of British goods. The EU is increasingly less relevant on the global stage, so Britain must look beyond this protectionist racket and pursue free trade.

According to Sir Michael, access to a market of 500 million Europeans is only possible if we surrender our sovereignty. He intentionally ignores the fact the EU exports more to the UK than vice versa.

In the 1990s the CBI unsuccessfully argued the only viable economic future for Britain is as a member of the Eurozone – clearly they are not the arbiters of what is in our national interest, so their judgement should be sternly questioned. They were wrong then about the Euro and they are wrong now.

What explains the CBI’s fanatical zeal for EU membership?

It might have something to do with the fact the CBI receives a regular annual grant from the EU  , averaging €184,025 (£157,331) per year – over £800,000 over the last five years, not to mention another £5.4 million from taxpayer-funded quangos. This is supposedly for “business and consumer surveys.” The EU is possibly the CBI’s biggest financial contributor – their position is one of naked self-interest, not Britain’s national interest – so why should we listen to the CBI?

It is also worth bearing in mind, the CBI is not the sole voice of business. In 2013, Business for Britain organised a YouGov survey of over 1024 business leaders. It found that 46% of British businesses said the costs of the Single Market out-weigh the benefits of being in the EU compared to 37% who thought otherwise, and a clear majority would rather Britain’s relationship with the EU focused on trade.

Lord Bamford, the Chairman of JCB, has just come out saying the UK will not merely survive, but will prosper outside the EU. JCB is one of Britain’s most successful industrial companies trading across the globe. Lord Bamford told the BBC: “We are the fifth or sixth largest economy in the world. We could exist on our own – peacefully and sensibly,” affirming we can do just as well (or better) outside the EU than in.

The CBI’s own former director, Lord Digby Jones, is a heavy critic of the EU, saying: “We are faced with an unelected ruling elite in Brussels who still can’t balance their books, where the culture is still one of marching valiantly towards 1970 and where criticism is condescendingly seen as heretical.”

Even on the issue of renegotiation, Lord Jones has little faith in Britain’s clout in Brussels: “David Cameron will get minor adjustments here and there but he won’t get the sort of reform upon which our future membership should be conditional. If anyone, the CBI included, thinks that fundamental reform is on the EU agenda, they are deluding themselves.”

It is an unfortunate fact that no matter how often this fallacy is refuted the CBI persists in repeating it. CBI officials will run through the usual list of EU myths as we approach the EU referendum but are clearly biased – be aware a huge proportion of their funding is dependent on Britain’s continued membership of the EU.

The commentary surrounding the Brexit debate can border on near apocalyptic scenarios and while the CBI has taken the bizarre stance of staying in the EU – no matter what – their arguments rely on complete fallacies.

They have no answer to the sound, economic case to Get Britain Out of the EU.

Alan Murad is a Research Executive at Get Britain Out 


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