EU REMAIN EVENT
THURSDAY 9th JUNE, STRANRAER
Ladies & Gentlemen,
Can I welcome you all to this evening’s meeting? The referendum on our future in the EU is only a few days away and yet I am sure that there are many questions that remain unanswered. I hope that this evening’s event will provide an opportunity for you to get some of those answers and I hope that we can persuade you to vote for Britain to remain a member of the EU.
I was a Member of the European Parliament for 15 years from 1999 to 2014. Some of you will be thinking: “Ah well, that explains it, no wonder he’s in favour of staying in the EU.” I have to tell you that I am not a wide-eyed Europhile. Far from it! Indeed I spent my three terms as an MEP criticizing many aspects of the European project and seeking reforms that could make Britain’s membership more attractive. I always opposed joining the Euro and I am delighted that David Cameron has secured an agreement that we will never have to do so; nor will Britain ever have to help bail out Eurozone countries; I always opposed ever greater and deeper integration and again Cameron has secured an opt-out for the UK. We cannot ever again transfer sovereignty to the EU without first having a referendum in Britain. With these key reforms, I believe our future is better secured inside the EU than outside.
My main job in the European Parliament was fisheries. I was variously senior Vice Chairman and Chairman of the Fisheries Committee and had to oversee the major reform of the Common Fisheries Policy. You might think that the chance to take back control of the fish in UK waters would be one of the most solid reasons to vote 'Out' in the referendum on EU membership. So what's the catch? First, the idea that the fish in British waters have been fished into near-extinction by nasty foreign vessels simply doesn't hold water. I recall bringing the Fisheries Commissioner to Peterhead & Fraserburgh in 2005, where fishermen complained that 30 years earlier they had been landing 400,000 tonnes of cod and haddock a year from the North Sea and now the wicked European Commission had cut their quota to only a miserable 14,000 tonnes. The Commissioner pointed out that those Olympic fisheries in the 60s and 70s were precisely the reason why cod and haddock stocks had all-but collapsed and he noted that the vast majority of the decline had occurred prior to the introduction of the CFP in 1983 and indeed prior to Britain joining the EEC in 1973.
Of course such savage cuts in whitefish quota meant that hundreds of Scottish boats were scrapped. The size of our fleet was slashed. But for those that remain the future looks good. Now the majority of fisheries are being fished sustainably. North Sea cod is recovering strongly and likely to be certified as sustainable next year. The EU has phased out the wasteful discarding of by-catch that led to over one million tonnes of good, healthy fish being dumped dead back into the sea every year. The CFP pain has turned to gain and Scottish fishermen can look forward to a profitable future, but only if we don’t put it all at risk by pulling out of the EU.
Let’s have a look at the other big common policy in the EU, the Common Agricultural Policy or CAP. Under the CAP British farmers currently receive 60% of their income from EU subsidies via the Single Farm Payment. They would lose most of this at a stroke unless the British government and the SNP government at Holyrood guaranteed compensating support of one kind or another. Is there anyone in this room that seriously believes that either the UK or Holyrood governments would subsidise agriculture on the same scale operated under the CAP? With the current focus on cuts and austerity and prioritizing schools and hospitals, there is no way that the current level of subsidies would be maintained.
Direct CAP payments to Britain will average £2.88bn a year up to 2020; last year these subsidies were worth €200 a hectare (£58 an acre). Only the super-efficient, top 10% of farm businesses could survive without them. Most farmers have thin margins, if they have any margins at all. The European Commission estimates that land prices would fall by 30% if farm subsidies were totally abolished in the UK and they would fall sharply if subsidies were reduced. For farmers who have taken out bank loans against the value of their land, a loss of value could be fatal. 18% of farms have current liabilities that exceed current assets. They couldn’t possibly survive.
The Brexiteers claim that the EU’s protectionist policies discriminate against cheap food imports and force up food prices for British consumers. In other words they want cheaper food following Brexit. That means Suppose throwing open UK markets to cheap food from Africa, Australia, North America, Brazil, and Argentina, causing chaos for UK farm gate prices, a further fall in land values and widespread bankruptcies. UK food self-sufficiency would plummet. Brexit is plainly an agrarian minefield.
Less well known is the fact that Britain’s food-processing industry is surprisingly big, and 60% of its exports go to the EU. The UK hosts the headquarters of 17 of the world’s 100 biggest food and beverage conglomerates, more than Germany, France, Switzerland and the Netherlands put together. Some would be tempted to leave, chiefly for dual taxation reasons. But even if the UK fell back on Most Favoured Nation Status after we leave the EU, we would have to ask ourselves: “Would Scotland be able to continue to trade tariff-free with Europe or would our lamb, beef, wild fish, farmed salmon, whisky, and other key farm exports face a tariff barrier?
Would access to important overseas markets remain or would the UK have to start over again in fresh negotiations?" By leaving the EU, we would be withdrawing from Free Trade Agreements with 53 countries negotiated by the EU on behalf of all of their Member States. These cover 60% of all UK trade. We would have to re-negotiate separately and individually each of these 53 agreements. Brexiteers argue that UK trade with the EU is declining year on year, while UK trade with countries outside the EU is steadily increasing. So why do we have to quit the EU to exploit this opportunity? Surely we can stay inside the world’s biggest single market and get the best of both worlds?
There is only one previous example of a country leaving the EU and that was Greenland. It has a population of only 60,000 and the only issue requiring negotiation was fishing rights. Nevertheless it took 3 years for Greenland to negotiate its exit. Could the UK face three or more years of economic uncertainty and turmoil while we try to negotiate new trade deals across Europe and the world?
It is hardly surprising that every major international economic forum wants the UK to remain in the EU, including the IMF, the OECD, the ECB, the World Bank and the G7 Economic Ministers. Mark Carney, the Governor of the Bank of England caused near apoplexy in the Leave Camp when he said last month that Brexit could plunge Britain into another recession. He said that an exit vote would risk depressing growth, increasing inflation and causing a fall in sterling. But it wasn’t only Mark Carney who was saying this it was the unanimous opinion of the whole Monetary Policy Committee (MPC).
It seems as if sage voices across the world are of the same opinion. You would have to look long and hard to find a single major financial institution worldwide that thinks Brexit would be a good idea. Maybe they are all wrong, but can we take that risk? I am well aware of the Leave Camp’s argument that our membership of the EU costs Britain £350 million every week. But what they forget to tell you is that we get more than half of that back in EU payments and farm subsidies. Our net payment annually to the EU is actually £7.3bn. For every £1 we pay in UK tax, only around 1p goes to the EU and what we get back in opportunities, job creation and economic security as well as free access to the world’s biggest single market of over 520 million people, far outweighs the cost of membership.
Being inside the EU makes the UK a magnet for inward investment from around the world, creating more jobs. Over the past decade, foreign companies have invested £549bn in the UK, equivalent to £148 million every day. Conversely, as Mark Carney has pointed out, if we leave the EU, the impact on international markets would be likely to plunge us back into recession just as we have emerged from the last one. The international rating agency Standard & Poors have already down-rated the UK based on the risk of us leaving. If interest rates for UK loans rise even by a fraction of a percentage point because of Brexit, the £7.3bn we pay annually to the EU would be swallowed up many times over within days.
Let me finally look at the two big issues that have dominated this debate, security and migration. We all know that the EU was founded on the objective of securing a lasting peace between nations that had fought each other for a thousand years, culminating in the devastation of the first and second world wars. It is all too easy to wave a hand in dismissal of this argument and to say that such issues belong to the past and could never engulf European nations again. And yet we don’t have to look too far beyond our borders to see the flames of conflict licking at our door. One of the most momentous events that occurred during my time in the European Parliament was the accession of the former Soviet Bloc States in 2004. To witness Poland, Romania, the Baltic States, Bulgaria, Hungary, Slovakia and Slovenia become full Members of the EU was an incredible experience. Countries, which had suffered decades of communist oppression were now free and the peace and stability of the EU was strengthened by their joining.
I have no doubt that Brexit would be celebrated by Russia and by ISIS because of the damage it would do to the West’s security. This was the key reason President Obama said he opposed the idea of Britain leaving the EU. National security and the fight against Islamist extremism were at the heart of Barack Obama’s appeal for Britain to remain in the EU. Indeed every one of our allies agrees with him, including all of the Commonwealth nations and every single one of the other 27 EU Member States. China, Japan, America, New Zealand, Australia, our military leaders, our leading academics and scientists and the majority of large and small businesses have all warned against Brexit. Can they all be wrong?
On the vexed question of migration, some argue that leaving the EU would give us more control over the number of immigrants that come to the UK. But is this actually true? In return for continuing access to the EU’s Single Market we would have to accept the free flow of EU citizens to live and work in Britain. This is what happens in Norway. The Norwegians have to accept all of the rules, regulations and red tape that Brussels produces without having a seat at the table to deliberate on these rules. Is that what we want? The UK never joined the borderless Schengen Zone, meaning that we do control our own borders and we retain the right to check everyone, including EU nationals arriving from Continental Europe. But against all the odds, David Cameron negotiated a deal that makes our benefits system much less attractive to EU citizens. EU migrants will have to work here for up to 4 years before they can access certain benefits.
So these are the key issues that we face when we fill in the ballot paper on 23rd June. The battle now joined over Europe has, on the one side, the romantic nostalgia of the OUT campaign that longs for a past that has disappeared in the mists of time and on the other side, people like me who wish to REMAIN. I don’t regard myself as a Europhile dreamer. I’m a Euro realist. I know the EU isn’t perfect. Show me a political or economic system that is? But I firmly believe that the future of the UK and the future of Scotland will be safer, more secure and better off by remaining with our partners in Europe. Better Together!