It’s pure delusion to conclude that rejoining the European Union would cure our financial woes and the public knows it, says Dr Michael Turner
Andy Burnham wants to reopen Pandora’s box. After solemnly promising before the Makerfield by-election that Brexit was settled, the Prime Minister now concludes that all options are on the table as part of a rethink of Britain’s relationship with the bloc. He joins a chorus of Westminster sentimentalists who insist Britain’s current economic stagnation is a purely self-inflicted wound from Brexit in 2016, and that only rejoining can resolve it. It’s a seductive narrative that suits a government with many problems, but few ideas. But it fundamentally misdiagnoses the issue.
Our latest City AM / Freshwater Strategy Poll shows the public’s lacklustre mood: two-thirds (66 per cent) of UK voters believe the country is heading in the wrong direction, while a similar number (65 per cent) are not confident in the government’s plan to achieve economic growth. Meanwhile, half (50 per cent) expect the national economy to worsen over the next 12 months, and half believe that raising taxes in the forthcoming budget would demonstrate the government’s economic failure rather than prudence.
It’s pure delusion to conclude that rejoining the European Union would cure our financial woes.
Britain’s economic stagnation has little to do with leaving the Single Market. More important is the decade-long relay race of anti-business, high-tax, statist management from several governments, blue and red. From Theresa May and Boris Johnson to Rishi Sunak and Keir Starmer, and now Andy Burnham, we have seen a series of leaders who don’t understand what actually generates wealth and prosperity.
A return to the debate over Europe won’t fix our domestic fiscal ineptitude, but will distract us from addressing it and inevitably tear the country apart once again.
We spent half the last decade watching British politicians squabble over whether to deliver on the original democratic mandate, and the other half struggling to deal with Covid. Brits have no appetite for a second decade of constitutional civil war. They want cheaper energy bills, more homes, more runways, an economy where people can afford a holiday, a new car, and to feel more secure in their job.
Anyone who works on deals for a living can see that Brussels is not in the business of charitable negotiation. Over the past decade, the EU’s treatment of the UK has focused on showing its remaining members that while membership can be costly, leaving the bloc is much more painful.
Most glaringly, the EU’s cynical use of Northern Ireland as a permanent geopolitical lever has revealed an institution that is legalistic (when it suits them), punitive, and ideologically worlds apart from Britain’s more market-led financial approach, whatever is left of it.
Our City AM / Freshwater Strategy Poll asked a series of questions about what might make people interested in rejoining the EU. While the toplines may excite the rejoin crowd, there is an inconvenient catch.
On face value there is majority support for rejoining (50 per cent). And this rises further if rejoining means frictionless trade and the ability for Brits to live, work, study, and retire anywhere in the EU (62 per cent).
Mirage
But the toplines are a mirage.
Of course it would be nice if we did have to queue at customs, if we could have more choice to live and study abroad. It would be ideal if British businesses weren’t held up by bureaucracy when trying to trade with businesses on the continent.
But as with any membership organisation, just because there are perks, doesn’t mean people sign up at any cost.
The trouble for the re-joiners is that public support shifts dramatically once they learn about Brussels’ non-negotiables.
Any referendum on rejoining will not be a vote on abstract goodwill; it will be a vote on how many more billions UK taxpayers will have to pay, whether to adopt the Euro, how many more politicians to add to the payroll, whether to relinquish fiscal control, and whether to accept regulatory alignment without a veto
If rejoining means paying more than ever into the EU budget, just 30 per cent would support the move, while 37 per cent oppose. Forcing them to confront joining the Eurozone reduces support to just one-quarter (26 per cent) and a majority of voters oppose (50 per cent).
The EU has already made it clear that they will never grant Britain a bespoke, buffet-style deal. Any referendum on rejoining will not be a vote on abstract goodwill; it will be a vote on how many more billions UK taxpayers will have to pay, whether to adopt the Euro, how many more politicians to add to the payroll, whether to relinquish fiscal control, and whether to accept regulatory alignment without a veto.
Any opposition campaign worth its salt will simply put those non-negotiables on repeat, and re-join will be dead before you can paint £350m on the side of a red bus.
Britian’s world-leading financial sector, which 75 per cent of voters rightly recognise as vital to the UK economy, needs the government to get back to basics, including competitive tax structures and genuine supply-side reform, not a return to Brussels’ dirigiste straitjacket.
Our problem isn’t that we are outside the EU; it’s that our political class has bought into Johnson-style ‘have-it-all’ cakeism and refuses to make difficult short-term political choices for sustained economic growth. It’s time to stop chasing continental mirages and start fixing Britain’s business.
Dr Michael Turner is co-founder and Director at Freshwater Strategy