Tony Blair recently came up with one of his masterful sound-bites. UKIP, he said, is a party based on scapegoating, not solutions. A clever turn of phrase, but vacuous when you examine it, for how can you propose solutions without problems? And the moment you point to a problem (the EU, immigration, wind turbines) you can be, I suppose, accused of scapegoating.
Meantime on Dec 23rd in the Sunday Telegraph, Andrew Gilligan, in a piece entitled “Could UKIP be the Tory Party’s SDP?” accuses UKIP of making “fantasy promises”. He says we proposed £15 billion of unfunded spending commitments, whereas the UK’s EU budget contributions are only £10 billion. He omits to mention that his £10 bn figure is net, and that gross contributions are around £18 bn (and rising) — more than enough to cover £15 bn of spending commitments.
But of course our direct budget contributions are a mere fraction of the total cost of our EU membership. A recent paper by Tim Congdon, one of the UK’s most respected economists, shows that total costs of our EU membership (including the major component, regulatory costs) amount to around £150 bn a year, or a staggering 10% of GDP. No one, of course, imagines that we could make savings of £150 bn in Year One following Independence Day. It might take several years to unwind EU regulation, and some regulations introduced over the years by Brussels would need to be retained. But much of the EU’s employment regulation could be eliminated rapidly.
Very substantial savings could be achieved immediately, and these would increase over time as regulation wound down. Many tens of billions could be freed up. These would fund more spending in key areas, like education and defence; they would help us to resolve the country’s debt problems; and after the books were balanced, they would underwrite a low-tax economy that would drive growth, prosperity and jobs.
Nor would we suffer trade penalties as an independent nation. George Osborne and Boris Johnson seem to be very confused between a Free Trade Area, a “Common Market”, and the EU’s Single Market. Let’s be clear: an independent Britain could not remain within the EU Single Market, as this would imply accepting both the EU’s Common External Tariff, and the stultifying burden of regulation which we are trying to escape. The objective is a Free Trade Agreement (FTA). (The term “Common Market” is too ambiguous for sensible comment).
“Why should the EU offer the UK a free trade deal?”, ask the Europhile doom-sayers. For several reasons. First, because outside the EU, the UK would be by far the EU’s largest export customer, running a negative trade balance. It would be hugely in the interests of both parties to have an FTA. And secondly, because the EU treaties require the EU to negotiate such a deal with any member-state which chooses to leave.
Someone should explain this to the CBI and to some Captains of Industry (especially in the auto business) who seem to assume, wrongly, that the UK would be a less attractive manufacturing base to service the European markets after we leave the EU. Not at all. In an FTA, market access is assured.
Outside the EU, as noted above, we should be relieved of the eye-watering costs of membership, and should therefore be able to offer lower taxes. We should no longer have the burden of EU regulation, so we could offer more flexible labour markets, and less bureaucracy.
As UKIP Energy Spokesman, I hope and believe that outside the EU, we should abandon Brussels’ absurd and hugely damaging energy policies, and implement a new policy designed to achieve secure, reliable and affordable energy.
So, Tony, UKIP is definitely about solutions. Solutions to our debt and fiscal problems. To growth and employment. To secure and affordable energy. And Andrew, our “fantasy promises” are covered many times over by the demonstrable expenditure savings we would make on leaving the EU. Lower taxes, balanced books, higher employment, more growth, secure and affordable energy, European market access. What’s not to like?