Thursday, March 13, 2014

EU turn if you want to

I've been undecided over the idea of a vote on membership of the EU for a while. Part of me wants to shoot the Tory fox and to put the issue to bed. I remain convinced that if the argument is placed before the people, then they would vote to stay in. And any pro-EU campaign would be spectacularly well-funded and supported. Not just by the political parties, but by businesses - those exporters who see their markets disappearing behind trade walls and would seek to transfer jobs back inside the EU. Think of the shock at Scottish business saying that they would relocate south of any newly independent border - imagine that multiplied by a factor of ten or twenty. 

Does anyone seriously believe that BMW, Nissan, Honda or JLR wouldn't shift production into the EU at the drop of a hat, if we voted to leave? And that's just the major motor manufacturers - we export cars on a massive scale, despite rumours of the death of the car industry.  

Current Tory policy Is for a referendum in 2017 after a renegotiation of the UK's membership of the EU to get a better deal. What that deal might be isn't ever discussed. I think that any substantial change in our position is very unlikely - we already sit outside Schengen and the Euro, both basic articles of faith for new entrants to the community of nations. What I suspect any future Tory government might be able to produce will be more spin than substance - a document that signifies nothing, despite the sound and fury that it will doubtless bring. What I think they want is an agreement that rolls back the social elements of Europe - stripping back our employment rights and protections - and then forces the pro-European parties into voting for it, as the alternative would be worse. Remember, the direction of travel for this government has been relentlessly towards the bottom - to a low wage economy with employees too scared for their jobs to challenge any erosion of their rights. 

But along the way, we have two to three years of uncertainty. If you are a business, do you invest in a country that might possibly leave an economically beneficial union - even if the government holds out the carrot of a vastly easier employment regime? Is that a risk Nissan would take with a new model, for example? That's the decider for me. Right now, the last thing we need is to destabilise whatever growth we have, but that's a very real risk of this government policy - another one that is strong on politics, but weak on sense. 

If you look at the polling, Europe isn't the biggest issue amongst voters. They are fussed about the economy, the cost of living, health, crime and poverty rate much higher. True, immigration is a hot button issue and that connects to membership of the EU, but the voters are much more bothered about how their daily lives are affected. 

Politically, given that Ed Miliband is leading heavily on the cost of living crisis, ending speculation about a Labour referendum offer (except in the unlikely event of a further transfer of sovereignty), he is clearly focused on the issues that matter. The bigger point is that he is also calling it right for business - the CBI are in support - and calling it right for jobs. Labour isn't the party putting jobs at risk for political reasons, because no matter how much the Tories wrap themselves up in the banner of democracy, this is about their fear of internal division and the threat of UKIP. 

William Hague said on the World at One, when challenged about the economic risks, pointed out that inward investment was booming. 

That might just be because business doesn't think that the referendum will happen. 

Maybe they don't think the Tories will be in power after 2015.