EU Membership: Economic Benefits

Debate between John McDonnell and Alex Salmond

Wednesday 15th June 2016 Commons Chamber

[John McDonnell]

We have yet to see the details of this Budget proposed this morning, but let us make it absolutely clear: the Labour party is an anti-austerity party and we have voted consistently against austerity measures.

[Alex Salmond (Gordon) (SNP)]

Is the shadow Chancellor aware that not only have we had the Chancellor’s proposed emergency Budget, but we have a six-point plan from the Brexiteers including a Finance Bill, which sounds less like a campaign than a coup to take over the Government? Does the shadow Chancellor detect any enthusiasm in the country for replacing this extreme right-wing Government with an even more extreme right-wing Government?

[John McDonnell]

I will come on to that subsequently.

With regard to trade, the EU is Britain’s largest export market by a long way. Some 44% of UK exports go to the EU, worth £223 billion. That is more than double the value of exports to the US, and more than 10 times the value of exports to China. That just gives an idea of the scale of the impact of the EU on our economy. It is argued that withdrawal from the EU will have no implications for jobs, investment and trade, almost as though things will just carry on as before. That flies in the face of experience of all other trade relationships. Access to the single market would have to be renegotiated. That would take at least two years, and more likely the seven to 10 years predicted by others. The climate of uncertainty created would undermine the critical factors investors and decision makers require when they invest for the long term: certainty, security and stability.

We have seen only this morning in Rolls-Royce the latest example of a company expressing its doubts about its long-term investment plans if Brexit goes ahead. We have also seen competitors across Europe welcoming with open arms those companies considering relocation if the decision goes to Brexit.