The £23bn question

After UKIP's shock successes in the European elections, Tony Blair said yesterday withdrawal would be 'extraordinary foolishness'. So what would it mean for Britain?
Click to follow
Indy Politics
Economy

Britain would suffer a permanent loss of £23bn a year if we pulled out, says the National Institute of Economic and Social Research, an independent think-tank.

Economy

Britain would suffer a permanent loss of £23bn a year if we pulled out, says the National Institute of Economic and Social Research, an independent think-tank.

Economic growth would be lower by 2.5 per cent, according to some leading economists' estimates.

Withdrawal could trigger a loss of confidence in UK economic prospects, possibly causing a run on the pound, leading to a rise in inflation through higher import costs, unemployment and interest rates.

More volatile interest rates would add to the risks of boom and bust in the housing markets.

Travel

100,000 Britons work in EU countries and 450,000 Britons live in them, including 200,000 pensioners.

British holidaymakers have the right to free health care in any member state with the E111 form.

EU airline deregulation has halved the cost of flights, causing a massive travel expansion. EU rules now mean airlines must offer compensation if they overbook.

Cheaper flights - and a strong economy - have contributed to a massive increase in British people owning second homes in EU countries. Withdrawal could make house purchasing more difficult.

Social reform

Withdrawal from the European Union would reverse fundamental employment and social welfare rights that UK citizens have enjoyed for more than 30 years.

Workers would be unable to bring sex, race or disability claims against their employers.

The 48-hour working week, regular breaks between shifts and a minimum 11-hour rest between shifts would also be obsolete. There would no longer be a statutory four-weeks annual holiday.

EU directives give two weeks' statutory paternity leave and increased maternity leave.

Trade

British businesses enjoy tariff-free access to the largest market in the world; 55 per cent of the UK's trade is with the EU. Every year the UK imports £129bn worth of goods from its EU partners and exports £105bn to them; the total is more than half of all our global trade.

In contrast, trade with the US is £52bn annually, about 12 per cent of the total. Not in these figures are services, such as banking and insurance, worth £160bn a year, which might be hit by withdrawal.

Some 3.2 million jobs are directly associated with the export of goods and services to the EU. About 750,000 businesses trade with our EU partners.

We need the EU more than it needs us: 9.5 per cent of the UK economy is trade with the rest of the EU; the reverse figure is 2.4 per cent.

If Britain withdrew, businesses would have to obey EU regulations to trade with Europe, without power to amend them.

Inward investment, which has fallen since the UK stayed outside the euro, would fall further outside the EU.

Law & the constitution

An army of lawyers and two or three full parliamentary terms would be needed to disentangle Britain from Europe.No one has any idea of the cost.

The Government would have to repeal hundreds of EU directives in UK law.

Britain would have to recall its judges from the European Court of Justice, losing a forum for settling arguments.

British representation at the European Parliament and Commission would end. Trading laws that would affect us would be passed without consideration of their effect on British interests

In October 2000 Britain incorporated the European Convention on Human Rights into domestic law. By withdrawing from the convention and repealing this legislation British citizens would no longer be protected by a set of fundamental human rights

Environment

There are more than 200 EU laws on the environment, ranging from recycling to clean beaches.

Catalytic converters would not have been made compulsory without the EU and there would have been no ban on leaded petrol.

The 1994 EU habitats directive bans interference in breeding places of endangered species. It has been used by campaigners to prevent roads, housing and industrial projects.

Wild birds in Britain are protected by the EU birds directive.

The EU bathing water directive has led to a big improvement in beachesMore than half now meet European standards.

EU curbs on sulphur emissions from French and Spanish power stations limit acid rain that falls in Britain.

Consumer

The cost of phone calls has halved thanks to the EU's liberalisation of the telecoms market.

The cost of electricity to consumers fell by 6.5 per cent between 1996 and 2001.

EU deregulation has introduced competition on airline routes once jealously protected by national airlines.

The European Commission has taken action against the British Government over customs officers stopping travellers bringing unlimited amounts of alcohol and tobacco for their own use into the UK.

Defence

Withdrawal would exclude Britain from future peace-keeping in crisis-hit regions.

It would deal a heavy blow to Britain's influence in military planning.

Contracts for military hardware, including the troubled Eurofighter, would be threatened, as would thousands of jobs.

Comments