EU Membership: Economic Benefits

Oliver Colvile Excerpts

Wednesday 15th June 2016 Commons Chamber

[Robert Neill]

I would not like to speculate as to the motives of those who, sometimes from genuine belief, but maybe sometimes from cynicism, want this country to leave the EU. The hon. Gentleman is right, however, that the issue was debated then. He and I can remember it—we both voted in that referendum, I suspect. Of course the EU needs reform, as everybody has said, but any businessperson will tell us, “You don’t walk away from a major market that you’re in just because it isn’t perfect; you stay in there, you negotiate your trade and you make the market work better for you.” That is basic common sense, and frankly I am amazed and mystified that some people who really ought to know better cannot get that.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Will my hon. Friend give way?

[Robert Neill]

I have been generous in giving way so far and I am conscious that others want to speak. I hope my hon. Friend will forgive me, because I know he will speak later.

Given the position that we have of that double success for the City of London, it would be a tragedy—a criminal thing, virtually—for this country to turn away. The financial services industry, as well as being a key UK asset and part of our national strategic interest, is not just about people in the City of London and those working in banks, insurance and offices. A successful financial services sector affects every family in this country. It affects every pension fund. It affects the pensions of millions of people, whatever their income situation or previous position in life. To put that at risk is not to damage just that industry, but to damage the whole population of this country. It damages the revenue stream, as my hon. Friend the Member for Cheltenham (Alex Chalk) just said, that underpins our public services. I am sorry to have to say this to some of my friends who I know genuinely believe otherwise, but it will be a profoundly unpatriotic thing to leave the EU.

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[Tom Tugendhat]

I wish to make some progress.

People are understandably concerned that the factors that led them to put money into our businesses may not last. The interconnected market, the skills base and the global trading agreements are not as permanent as they once thought; they are not even as permanent as they looked a few days ago. The implications and the consequences for us are very severe. Some have begun to doubt us, but they are wrong. Britain is a powerful and growing economy, and despite the undoubted hiatus that would follow a Brexit, we will recover. Indeed, for the markets, we will once again become a safe haven, but only by comparison with our neighbours. The implication that the Europe Union could disintegrate is worrying.

Let us be under no illusion as to why the option to leave the EU is bad for Britain. It is not, as some have sadly claimed, because Britain is too small. It is not because we cannot survive in a globalised world—it is clear that we are better connected and better integrated with the global economy than many other nations. No, it is because we are the economic leaders of a continent of more than 500 million people who are crying out for that very leadership and the very reforms that we offer.

[Oliver Colvile]

Will my hon. Friend give way.

[Tom Tugendhat]

I will make a little progress if I may.

It is worth remembering that this House has shaped the leadership of Europe. We have already achieved two very significant reforms. First, Britain, under the then Prime Minister Margaret Thatcher, steered the competing economies of Europe into a single market. She achieved that against pressure from many other member states. She did so to extend what Britain needed then and what it needs now: economic relationships that endure across the continent. The result was a huge boost to the economy. I pay tribute to my right hon. Friend the Member for Wokingham (John Redwood), who is no longer in his place, for what he did as a member of the Cabinet that took us into the single market. I also recognise the work of my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), who is also not in his place, as he helped us to achieve the lowest debt levels in a century.

Secondly, we have extended the boundaries of European co-operation to the borders of Russia. This may seem obvious now, but when I was growing up during the cold war, the challenge of uniting a continent seemed extraordinary. Now so obviously one nation and at peace with her neighbours, Germany was not always so, and many opposed the unity that was achieved. The inclusion of Estonia—I had the privilege of serving with Estonian troops in Afghanistan—Lithuania and Latvia shows what inclusion can achieve in the service of peace.

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[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

I enter the debate with a certain amount of trepidation, especially after the powerful speech by my hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat).

The reason I will be voting to remain is that, frankly, I do not trust the Germans and the French to run Europe without us there to keep a close eye on them. Over the last 16 years—as the parliamentary candidate for Plymouth, Sutton and Devonport and, more recently, as its Member of Parliament—I have always sought to take a realistic Euro-view. I am not Euro-suicidal; we should make sure that this thing works for us and that we get as much as we can out of it. However, if there is a downturn in our economy, which appears likely should we come out, any action on the issue I have campaigned on for the last 16 years—the improvement of the railways and roads down to the south-west—will be put off for another 10 or 15 years, which would be a personal disaster.

The debate on our membership of the European Union is very similar to previous debates, such as those on the corn laws and imperial preference. Thank goodness our country eventually found a way through those issues, but it unfortunately had to get involved in a few world wars in the process. I am keen to ensure that that does not happen again, especially as my relatives have fought in every world war and probably every other war—we have been here for a long time.

Our job in Europe is to maintain the balance of power. That is utterly crucial. When we have walked away from Europe, we have had to pay with an enormous amount of blood and an enormous amount of treasure. I received a briefing the other day from one of the more renowned journalists in this country, who told me that America is now looking less at Europe—it sees Russia as a regional, rather than a world, issue—and that it is much more interested in the Pacific. If we come out of Europe, therefore, we will be Billy No Mates, and I do not want that to happen.

Earlier this year, during the recess, I spent a few days in Norway with the Royal Marines, seeing for myself some of the issues they have to deal with. I got involved in trying to build shelter, light a fire and kill a chicken—I did not do that—and it was all rather difficult. However, I also learned how important the Baltic states are for this country, and we must continue engaging in Europe because I am afraid that that issue is going to be very big. I would also add that the Americans are not interested in putting money into NATO; they are seeking to take it out, and the moment we decide to walk away from all of that, we will find ourselves having to spend more money.

[Tom Tugendhat]

Does my hon. Friend recognise that the Republican candidate for the United States presidency has declared NATO obsolete?

[Oliver Colvile]

Absolutely. I find that utterly stunning. That is why we want to remain.

Babcock, which runs the dockyard in my constituency and employs 5,000 people, has written a letter to The Times very firmly in support of remaining. I have a boat manufacturer that is very worried about what would happen should we come out, because it thinks that the French and the Greeks will seek to protect their own boat-building industries and that it will therefore have to pay a significant surcharge. We would end up seeing the university and students in my constituency very badly damaged. We have a global reputation for marine science engineering research, and I do not wish to jettison that.

The claimant count has come down to below 4% in an extremely deprived constituency. It is rather unique to have a Conservative Member of Parliament representing an inner-city seat that has an 11-year life expectancy difference between the northern and western parts and around Devonport. It is very important that we continue to be able to invest in changing these kinds of things.

The Prime Minister has done exactly the right thing in seeking to make sure that he got the best possible deal out of the Europeans. We have to remember that if by some chance it was decided that we should become much more integrated in the European Union, we would have another referendum. I hope that will horrify all Conservative Members, because we have had enough of all this.

This is about making sure that we have a strong position in Europe and that we deliver on the economy for the west country, but also that we do not get involved in any more world wars, or wars of any sort.

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[Alison McGovern (Wirral South) (Lab)]

As part of Labour’s in campaign, I spoke to a woman on the phone last night. She was not sure how she was going to vote, and she did not know who to believe. She said that she just wanted the facts, so that is where I begin. We must be absolutely clear: globalisation is happening, and it is not going away. With democracy in eastern Europe and the opening up of China and India, capital, goods and people move freely across borders like never before, creating opportunities but also causing disruption. The globally connected economy means that problems in the American mortgage market can trigger a recession that spreads around the globe in hours.

That is the modern world. For us in Britain, each generation must answer this question: although we accept free trade because of the opportunities it offers, what rules are required to make the market fair? The global economy offers the UK huge potential. We have advanced service sectors, and our creative economy has boomed. Nowhere is that more obvious than in our capital, which is perhaps the most globalised city in the world, but go to Manchester or Liverpool and the story is the same.

We must be honest about globalisation. Although it creates opportunity for many, it causes others disruption and dislocation. Jobs are created, but jobs are also lost. Capital movement can grow the economy, but capital hiding—offshore and untaxed—hits our public services. How do we get maximum gains from this changing world, and how do we minimise the disadvantage? That is the real question to be answered by the EU referendum.

Amid all the misinformation in this debate, there is a deep dishonesty about the campaign to leave the European Union—or perhaps I should say the two campaigns, because there are two completely contradictory arguments up and running at the same time. On one hand, we are told that we must leave so that we can stop the disruptive effects of globalisation, close the borders, introduce protectionism and give British workers preferential treatment.

[Oliver Colvile]

Does the hon. Lady recognise that the Brexit campaign has also led people up to the top of the hill in relation to immigration and could be doing enormous damage to community relations?

[Alison McGovern]

I could not have put it better. Those who are feeling the sharp end of globalisation are presented with a particular suggestion about that as a solution, but as the hon. Gentleman says, it is nothing of the sort. It would sabotage the British economy, destroy even more jobs and reduce revenue for public services.

On the other hand, there is the other set of leavers—the people who think the problem with the EU is, as we heard earlier, that it shuts us off from globalisation. They say we should leave Europe and face the world, embrace non-EU immigration and let the market rip. Even if we ignore the difficulty of facing the world when we have no trade deals, that is not an attractive option. It would mean even more churn in the British economy, even more losers from globalisation and an even greater sense of dislocation.

Those are therefore two bad options and a false choice for Britain, but there is one even bigger deceit: the lie that we can have both those things at once. That is not true, because people are either up for free trade and taking part in the world, working with others to make markets work, or they want to shut Britain off from the world. By allowing that confusion, the leave campaign is misleading people. This dishonesty, which is put across as plain speaking, is about telling low-paid workers that there is an easy remedy for their woes when, in reality, the medicine will only make the patient sicker.

I agree with the Brexit lot on one thing: it is time for plain speaking. The truth is that the world economy has globalised, which brings big opportunities but also brings disruption and loss to many people. We will solve that not by running a siege economy or letting the market rip, but by staying in the single market and taking advantage of the opportunities that will come in the next few decades as we properly integrate services and energy into that market, which is where we stand to benefit. Given that the EU is the market for 47% of our exports, we should help eurozone countries make the economic reforms they need so that they can buy more of our goods, not just leave them to fail.

As we know, co-operation is key to how we maximise our success and central to minimising the negative effects of globalisation. It is only through co-operation in the EU that we will make sure there is no race to the bottom on working conditions. For a low-paid worker, Brexit will mean worse conditions and worse career progression. For a higher-paid worker, Brexit will mean fewer opportunities, less trade, worse pay progression and higher taxes. For a pensioner, Brexit will mean less money to invest in the pensions system. Even pro- Brexit economists acknowledge that there will be a short-term hit.

I have talked about the long term, but let me take a moment to consider the short term. Brexit will mean a recession, as if we needed another recession after the horrors of 2008. Unlike in 2008, however, we would not have a Government willing to work with others around the world to solve the crisis; we would have a recession under the most right-wing Government in living memory, and we would have a closed economy that would make all of us, but especially those with the least, poorer.

This is the question on the ballot paper next week. It is a choice between prosperity in the EU and austerity out of it; between influence in the EU and irrelevance out of it; and between facing up to the modern world economy and making it work for Britain, and pretending that we can solve our problems by quitting, which we will not. Let us vote remain.