George Osborne has threatened to raise taxes and cut spending if we vote for Brexit. However, some of the organisations producing the doom-laden economic evidence which could justify these threats may have a conflict of interest.
This would not only bring their own research into question, but also the judgement of a chancellor who may end up leaving a trail of ‘dodgy dossiers’ in his wake.
The following is a widely accepted definition a conflict of interest: “…A set of circumstances that creates a risk that professional judgement or actions regarding a primary interest will be unduly influenced by a secondary interest.”
Such a situation is not illegal, but most accept it should be avoided to maintain independence and impartiality while guarding against corruption and bias.
So what of the economic research that might support Osborne’s drastic measures? A recent report by The Institute for Fiscal Studies (IFS) claims UK borrowing would rise between £20 and £40 billion after Brexit, severely damaging the economy. Leave campaigners argued the report was biased and the IFS is part of a ‘cosy establishment’, but these accusations were dismissed as ‘paranoia’ and ‘conspiracy theory’ by the Remain campaign.
However the IFS website tells us: “Since 2009, IFS has been awarded 7.5 million euros from the European Research Council (ERC).”
Further, IFS research was based on data from the National Institute of Economic and Social Research (NIESR) who also warn of a high price for Brexit. The NIESR website explains how they generate revenue. You judge whether they have a conflict of interest: “…We carry out research commissioned from a variety of sources…particularly the Economic and Social Research Council, the European Commission…and the private sector.”
The Organisation for Economic Cooperation and Development (OECD) has also produced research that undermines Brexit, much touted by the Remain campaign. The OECD receives money from all its member nations, with Germany the biggest EU contributor. They also receive money from the EU itself, with over €40 million donated from 2001 to 2011.
Further, a 2015 European Parliament report explained the following: “The EU doesn’t contribute to the OECD budget directly but it makes substantial voluntary contributions, which amounted to EUR 39,8 million, EUR 29,9 million and EUR 40,4 million in 2013, 2012, 2011, respectively. Reportedly, the EU paid for joint conferences when the OECD was in financial distress.”
No wonder the OECD’s website talks of “institutional collaboration” and opportunities to “strengthen the synergy between the European Commission and the OECD.”
Then there is the Price Waterhouse Coopers “independent study” on Brexit. The following extract is from the PwC website. See if you can guess what their study concluded: “PwC is proud to be associated with the EU’s key initiatives and programmes…PwC provides services to assist the EU Institutions in fulfilling their mission of policy making, governance and organisational delivery. We have teams based in all 28 Member States which can provide professional services.”
A number of London School of Economics (LSE) departments, such as the European Institute and the Centre for Economic Performance (CEP) have produced negative economic forecasts for Brexit. A recent CEP publication “The consequences of Brexit for UK trade and living standards”, predicted a cost of up to £6,400 per household, similar to the 2008 crash.
They have a curious disclaimer on the first page of the report. “The Centre for Economic Performance (CEP) is a politically independent Research Centre…the CEP, receives less than 5% of its funding from the European Union.”
However in its financial statement ending 2015 the LSE as a whole announces: “The School has been very successful under the EC Horizon 2020 programme, securing 20 new awards with a value of £10.0m.” Horizon 2020 is the biggest ever European Union research programme with €80 billion to throw around between 2014 and 2020.
There are many more examples like this. But whether universities, businesses, NGOs or the UN (the EU is their biggest single contributor), given such a vast system of patronage, is it any wonder so few are prepared to go against the EU agenda? These organisations may not be part of a ‘cosy elite’ but they do a very good impression of one.
The reality is a conflict of interest exists when an organisation receives money from a third party whose views it then supports. It is not a conspiracy theory or paranoia, it is common sense and it means their evidence cannot be trusted. But elites know they can dismiss such arguments with name calling. Possession is nine tenths of the law and the EU owns our political culture.
The problem is that a modest, short-term price for Brexit doesn’t deter most outers, who value democracy even more. That is why biased reports, predicting economic catastrophe, are so important to the Remain campaign and ‘Project Fear,’ now reaching its ugly climax.
It is sad that some in public life have so little respect for the British people and those who hold a different view from them. But whatever the result of the referendum, and whatever George Osborne really believes, the truth has a habit of coming out one way or another.
So with that in mind, here is the last word on the matter, from a 2009 EU report on corruption in Turkey: “Finally, conflicts of interest undermine trust. They make the public lose faith in the integrity of the governmental decision-making processes. This ends up with corruption and erosion of democratic governance.”