Economy and Finance

Lord Lee of Trafford Excerpts

Thursday 9th June 2016 Lords Chamber

[Lord Lee of Trafford (LD)]

My Lords, I congratulate the noble Lord, Lord Haskel, on securing the debate. With only a fortnight to go until the referendum, which is so crucial to our country’s economic future, I must focus my contribution on it. I very much disagree with the noble Lord, Lord Leigh, on this, although we share the same tailor.

My mood is a mix of anger and sadness—anger that the leaders of the Brexit campaign choose wilfully to ignore the warnings of so many who have far more experience of international trade and finance than they do. They do not care that virtually all trade bodies that have polled their members want to remain, from manufacturers to tourism bodies, from bankers to the NFU. Some 80% of members of the CBI want to remain, as do 80% of the Society of Motor Manufacturers and Traders, 80% of the Engineering Employers’ Federation, 80% of the leading tourism body, UKinbound, and 80% of the leading chairmen of our retailers, as polled recently by Korn Ferry. The leaders of the Brexit campaign do not care that the heads of our great international trading companies, such as Shell, Vodafone, GKN, Rolls Royce and Diageo are in favour of remaining, as are all our airline chiefs, who warn that travel and holiday costs would rise if we leave. The leaders of the campaign do not care if our construction industry is deeply concerned that a severe shortage of skilled workers would arise on Brexit, that our hospitality industry would virtually collapse without migrant workers from mainland Europe, or that our banks, such as JP Morgan, have warned of severe job losses.

Brexiteers talk of increasing trade with countries such as China and India. What are these products that we could sell but are not at the present time? Please name me a company that has said it needs Brexit to export more. Of course, Europe would still want to trade with us on Brexit, but it would not make it easy, if only to discourage other countries from following us. On renegotiating trade deals, as Robert Azevêdo, the director-general of the World Trade Organization, said earlier this week:

“It seems that there is a great deal of confusion about the trade implications of a British exit from the EU. I think it’s important to provide the facts. The likelihood is that a British exit would lead to a sequence of complex negotiations—with the EU itself, with the 58 countries that have trade agreements with the EU, and also with all the other members of the WTO. These negotiations would be complex and drawn out”.

Brexiteers peddle another myth: that onerous EEC regulations could and would be swept away. The Chartered Institute of Personnel and Development, which represents 140,000 personnel directors and managers, says that Brexit would lead to “very little … change” in UK employment law. I could do no better than quote Sir Roger Carr, the chair of BAE Systems, who said in the Times on Monday:

“To leave Europe would dislocate the momentum of our steady recovery and threaten exports today and productivity tomorrow. It would be both foolhardy and disruptive”.

How dare those Brexit leaders such as Duncan Smith, Gove and Johnson, with near-zero commercial experience themselves, arrogantly challenge all those bodies and individuals that I have quoted today?

I said I was also saddened by so many of the older generation interviewed in our pubs and clubs just focusing on immigrants and immigration as a reason for voting “out”, as if, by a stroke on Brexit, our borders will be closed and the sad flow of refugees internationally stemmed. Sadly, many of those older Brexiteer voters would suffer if we exited, through stock market turbulence affecting their pensions, price rises on imported goods and more expensive holidays. Their children and grandchildren would suffer through fewer job opportunities as foreign investors chose to invest within the EEC rather than the UK, where they would have to surmount tariff barriers to export to Europe.

Anyone who knows anything about investing and business expansion knows that an economic background of certainty and confidence is crucial. Brexit would provide just the opposite: turbulence and uncertainty; stock market and sterling falls; likely interest rate rises; and a flight from sterling that has indeed already started. I hope and pray that we vote “remain” on 23 June, and that in the end our people pull back from the brink and from the tragedy that Brexit would deliver for this and future generations.