MPs Should Get Some Business Experience before Lecturing Us Against Exiting the EU

MPs Should Get Some Business Experience before Lecturing Us Against Exiting the EU

I’m getting quite tired of listening to politicians, and indeed some friends, who have never set up a business, or run a business, tell me about recklessness of pulling out of the European Union.

Now, as of yet, I don’t have kids, although I am a proud uncle. But based on the fact that I know so little about parenting, I wouldn’t march blasé into broadcasting studios lecturing parents on where to shop, or on the process of applying for nursery vouchers (if there is one).

Yet we have a conveyor belt of MPs who quite confidently parrot out assumed ‘facts’ about the EU; which actually don’t seem to include any verifiable or reliable data.

Perhaps the moment infamous; Nick Clegg’s assertion that leaving the EU “would cost 3 million jobs” in Britain, being exposed as a gross statistical misrepresentation of South Bank University’s study almost fifteen years ago, that only calculated UK exports (we import more, by the way).

More to the point, state-sponsored EU pen-pushers did not create these jobs. Proactive manufacturers and entrepreneurs who happen to live in Europe built their cars, boats, watches, clothes, et cetera. And customers who like the products – who may also happen to live in Europe – eagerly bought them.

For the 95 per cent of British companies like the one I founded, who do not materially work in the Eurozone, what would happen if the UK chose – via a democratic mandate to withdraw from the European political union?

Well, read the example of Norway, more than twenty years ago: some considerable benefit.

I predict this because I’m assuming that our national tax obligations would logically decrease (as in Norway), as our country would save around £9bn in net contributions, another £2bn in ‘growth penalties’ and also not be liable to bail out failing EU-member economies to the tune of £14bn (as we did with, effectively, a thirty-year bridging loan to Ireland). Norway pays around 2bn Euros in fees and grants to the EU.

We would also have reduced health and welfare spending, to the tune of several billions, due to visitors and new migrants (as they do in any other non-EU economies) having to take out travel and work insurances. (Health tourism costs the UK economy £2bn.)

Moreover, these costs are likely to expand as the six official EU ‘candidate countries’, whose applications are backed by Mr Miliband, Clegg and Cameron (including Turkey and Albania) with a combined population of around 90 million, will rightly expect to be admitted into the EU bloc and not be treated as second-class members.   

Most research designed to understand the UK’s situation only focuses on our exports. For example, the National Institute of Social and Economic Research (NISER) suggested fifteen years ago that “up to 3.2 million UK jobs are now associated directly with the exports of goods and services to other EU countries.” But they concluded, that “there is no prior reason to suppose that many of these jobs, if any, would be permanently lost to the EU.”

NISER conclude this mainly because the UK already traded heavily with her neighbours prior to the European Economic Community being established. The additional reason is that we all still need passports and sometime various export licenses to travel within Europe. Finally, I would also venture that this global digital media era, we can all Skype clients in Albania, Arkansas or Archangel , as equally as easy; at a time of our choosing, free of charge.

Ironically, if we saved money from lining the pockets of delusional Eurocrats in Brussels, we could afford more investment into improving this country’s awful Wifi coverage.

Despite researchers, journalists, and some  more intellectually diligent MPs, wanting to understand all the maths around EU membership costs and benefits, neither this government, the last one, nor the European Union, is able to provide any data that either supports the dependency of the UK economy on the EU or otherwise. 

Given that UK taxpayers – including our businesses – have paid in £200bn (in equivalence to today’s money) since our membership begun, this is a reprehensible and shambolic oversight by a so called ‘member’ led institution.

If any other business or membership organisation behaved quite so pompously, then those who pay the annual membership levy, probably wouldn’t wait for forty years to suggest quitting the forum.

Recently, I returned from New York, and talked to a packed business forum of security management professionals. As Secretary of State John Kerry pointed out a few months ago, one million Americans work for British firms and one million Brits work for American companies.

And funnily enough, foreign people like us Brits were physically allowed to buy clothes, feed ourselves, and even buy family homes, or take out store cards in America, if we were so inclined.

Yet we don’t have to pay American officials or British bureaucrats £9bn a year for this privilege. And for some reason, taxes and goods are a bit cheaper out there. I can’t think why.

Likewise, we don’t need to create a sponge-like political union for trading with any of the faster growing, emerging markets; countries that will come to dominate the global economy by 2020 onwards.

We taxpayers don’t need to pay around £15bn per annum to have the right to trade in BRIC countries (Brazil, Russia, India, China) and other massive developing markets; the Gulf, Singapore, Thailand, Mexico, Indonesia, and so on.

If we suggested such a tangled-up, bureaucratic concept to their trade ministers, we would be laughed out of the room in Abu Dhabi, Singapore or Jakarta.

Indeed, our own comparatively wealthy internal market of 65 million citizens will retain WTO Most Favoured Nation Status; perhaps only if we remain outside the EU.

I say this because, investment bank Goldman Sachs, and the Economist Intelligence Unit, predict that the BRIC countries (alongside the USA) will likely be the world’s largest economies by 2020; all being larger than France and the UK, and Germany. Russia is becoming the largest automotive market in Europe (toppling Germany), and China is becoming a larger automotive market than the USA.

The consumer markets in these countries extend to tens, if not hundreds of millions, of increasingly affluent customers.

Moreover, 40% of growth will come from ‘city economies’, within these emerging markets, researchers at the University of Maryland Business School found. Less than ten per cent of these cities are in non-Russian Europe; most to be found in Asia, Africa and Latin America.

Only two of the world’s top twenty emerging markets are to be found within the EU; Poland and the Czech Republic.

Yet still our MPs and Ministers spend thousands of hours agonising over tweaking trade deals to include Albania or Bosnia, or signing-off repeated multibillion Euro taxpayer-funded bailouts.

I’ll be transparent here. My own view is that the EU is an intractable, economic anachronism; dying (a little like the Soviet Union did) on its own contradictions; addicted to more and more spending, power accumulation, and democratic illegitimacy. When any entrepreneur will probably tell you that modern economies need to be agile, competitively attractive for both firms and the employee, and as free as possible from debt and instability (like bank crashes and random invoices: the latest to the tune of £1.7bn – or £60 per UK person).

So, as somebody who has actually gone through the process of establishing a business, running a business, and working for the private sector in the City of London, my question to Chuka Umunah, Ken Clarke, John Gummer, or the Conservative blogger in Suffolk who calls UKIP “neo-nationalist”, is how on earth can you justify a view that does not even critically and sensibly examine the true business costs and benefits of EU membership?

After forty one years of membership, costing at least £200bn to our taxpayers, EU supporters in Parliament should be the ones who have to justify staying in — rather than heaping unedifying criticism on those of us who rather politely say that the whole structure has become a fool’s paradise. We need to be global, agile and forward-facing, not regional, static and backwards-looking.

If those views make me a ‘neo-nationalist’, then I humbly apologise for having the experience to know just a little of what I’m talking about.

Richard Bingley is a senior lecturer and entrepreneur