Miliband has reduced Brexit risks – now we can work on EU reform
BUSINESSES want two things from government: clarity about policy, and certainty about the business environment. This is particularly true on an issue as crucial to Britain’s economy as our place in the European Union. That’s why business leaders have been so worried about the shifting sands of debate on a possible EU referendum.
The great majority of businesses want the UK to remain in the EU, as an active and committed member, because of the EU’s importance for growth and jobs. A survey last year by the Confederation of British Industry found that 80 per cent of its members (including 77 per cent of small- and medium-sized firms) would vote to stay in the EU if a referendum were held now. Three-quarters felt that leaving the EU would hit foreign investment in the UK. More recently, a survey last month of FTSE 100 chairmen by KornFerry found that no fewer than 86 per cent of respondents believed it would be bad for business if the UK left the EU.
That is not to say that the European Union does not need to change – it does. Businesses, both in the UK and elsewhere, want to see changes that will make Europe more competitive, more flexible and more outward-looking. But to achieve the necessary reform, the UK needs to be fully engaged with its partners at the heart of the EU, not waving from the sidelines and making noises about leaving.
Ed Miliband’s speech yesterday, in which he said that a Labour government would only hold a referendum in the next Parliament in the event of a new transfer of powers to Brussels, is a very helpful clarification of the Labour Party position, and it will reduce the risk of Brexit. It is unlikely that there will be EU treaty change any time soon – not least because most other EU member states don’t want a renegotiation. And it is much better for any referendum to be based on real change rather than on a predetermined timetable. So Miliband’s intervention is definitely a move in the right direction.
The key thing now, as we look forward to the European elections and the appointment of a new European Commission, is to focus on the substance of the reforms that are needed, and to get stuck into the job of securing them. To do this successfully, the government needs to work harder to build alliances with other member states. Many of our European partners also believe that reform is essential and want to see the same sort of changes that we do. So the UK needs to get on with it – at the European Council next week, which will focus on competitiveness, at the EU-US summit the following week, which will discuss trade negotiations, and beyond.
And it’s important to underline that a great deal can be achieved without the need for any treaty change. Business for New Europe has published a Manifesto for Reform, signed by over 260 business leaders, including a third of the FTSE 100, which sets out just such a practical agenda. It includes completing the unfinished business of the Single Market in services, energy, transport and telecoms; creating a genuine digital Single Market; agreeing comprehensive free trade deals with the US and Japan; tackling excessive regulation, particularly for small businesses; creating an integrated European venture capital market to support enterprise; and enhancing the role of the City as the world’s financial centre in Europe. Indeed, it was good to see that some of these proposals were mentioned in Miliband’s speech. Focusing on these areas would make the EU better – for the whole of Europe and for Britain.
Roland Rudd is chairman of Business for New Europe. www.bnegroup.org