Why Britain Must Renegotiate its Position Within the EU

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The UK currently faces a huge question over its position in Europe. The rise in popularity of UKIP has forced the hand of the three major parties, creating an unprecedented debate over EU membership.

With contrasting views prominent within both the Labour and Conservative party, Britain must collectively make a crucial choice; a renegotiated position? Or a complete exit?  

David Cameron and Angela Merkel

Since the days of the Coal and Steel Community, the EU has transformed itself. It’s heavily deviated from its original purpose of mutual economic benefit and security that meant conflict was materially impossible after two world wars.  Membership has now increased to 28 member states, who differ vastly in levels of development. Political entrenchment has also rapidly expanded, with the creation of an Executive, legislature, Central Bank and European Court of Justice. Some would argue that these institutions are overall beneficial to Europe, yet if we look at the European Central Bank (ECB) and the single currency, one could argue they’re both culpable for economic mismanagement, and a lack of prudence.

The UK opted out from the single currency, retaining the right to exercise its own monetary policy and currency valuation. Looking at the malevolent debt crisis that infected Portugal, Ireland Greece and Spain, it looked like a wise decision.

Being part of the stronger Euro has reduced Greece’s competitiveness

If we examine the single currency more closely, its flaws become ever more apparent. How can a weaker economy such as Greece feasibly share a currency with Germany?

Previously, the weaker Drachma made it easy for Greece to export agricultural products. Being part of the stronger Euro has reduced Greece’s competitiveness whilst simultaneously becoming flooded with manufactured imports funded through cheap credit. In 2010, car loans in Greece were 8 billion Euros, 3.5% of GDP.

Despite the fortune of avoiding the inevitable calamity of the single currency, UK business has greatly benefited from having protectionist free access to an export market of 500 million consumers. Europe is the UK’s largest trading partner, 50% of our exports go to EU members meaning that remaining in the common market is crucial. Jobs, growth and investment would inevitably suffer if we were to exit. This is despite UKIP’s claim that retaining the right to establish trade deals exclusive to the UK would be more beneficial. As an economic community based on trade and commerce, the EU works well and mutually benefits countries by facilitating free trade.

However, the undemocratic expansion that has occurred both horizontally and vertically with growing members, and greater sovereignty being transferred to Brussels means the UK must attempt to renegotiate its current position. Currently the UK pays membership fees of £55 million a day. Proponents would argue that this enables the EU to function and contributes to worthwhile benefits such as the Common Agricultural Policy. In my view, this can be substantially cut, making the existing bureaucratic machine more efficient.

Britain currently has no control over EU immigration.

Domestically the UK must also look at its excessive welfare bill being forced up by huge population growth. Since 1964, the population of the UK has grown by over 10 million people (18.7%).  About half of this growth has occurred since 2001. It’s well reported that the NHS currently has a £30 billion black hole in its funding. It cannot be argued that this isn’t predominantly due to uncontrolled immigration, combined with people living longer. In the EU, the free movement of people means that Britain has no control whatsoever over European immigration.

This has had a detrimental effect on various industries including construction, by creating an excess supply of labour. This is further exacerbated by the huge disparity in wages between various EU member states.  For example, Romania’s minimum wage is 1/9 of the UK’s, making Britain highly attractive to workers abroad who are able to undercut the domestic workforce.

It is not wrong to express concern about the scale of people coming into the country, its simply about control. Britain is a fantastic multicultural community and controlled immigration can enhance and contribute to our economic and general well-being.

In my opinion, it also wrong that EU immigrants can attain welfare without paying into the system for a reasonable period of time. The fundamental principle of welfare is that people must contribute before they benefit. My concern with current legislation is that it can potentially create free riders by allowing people to benefit before contributing their fair share. Stopping benefit tourism must be a key objective in any renegotiation, and I commend the current government’s proposal of preventing the payment of benefits to EU immigrants, until they have worked and paid taxes for 4 years.

The UK must participate in a sensible debate over Europe that is based on fact and not prejudice. I believe that a renegotiation and  re-patronage of powers are crucial for our national interest. Only if renegotiation fails should the UK ever consider leaving a marketplace of 500 million people, whom massively contribute to our economic and cultural prosperity.

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Discussion1 Comment

  1. avatar

    Very good Joe, I can’t say I agree with all your comments about a possible exit. After all we joined a common market; not this Godawful mess we now have. I’m impressed though.

    GRALAN

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