Ukip’s rise has led to fear in Westminster. Politicians see how the party has gained momentum, and they fret about the impact on the outcome of the general election next year, and in some cases their own jobs.
This anxiety is having several consequences. Eurosceptic voices have become bolder, and balanced debate has become rarer. On an issue as important as our EU membership, this is dangerous, and is tainting politics more broadly.
In particular, the economic dimensions of the issue are being overlooked. If the UK left the EU, there would be real consequences, making it harder for our companies to compete internationally. Jobs would be lost and investment would suffer. We would fall out of trade deals with countries around the globe, and would lose influence on the world stage.
The potential impact of leaving the EU should not be underestimated. It is our largest export market, accounting for 45 per cent of all UK exports, and it plays a vital role in our prosperity. It is essential that politicians make these points. Recent polling by YouGov suggested that 16 per cent think leaving the EU would make no difference to our economy, and 17 per cent said they didn’t know. In this environment, it is hardly surprising that a party like Ukip can make such headway.
Even on the issue of immigration, we have seen a failure to acknowledge and articulate the economic and business dimension. The ability of people to live and work abroad helps firms compete and trade across international boundaries. We should also remember that people from overseas have made a huge economic contribution to the UK, helping to create jobs and prosperity, and benefitting our national finances. According to the Centre for Entrepreneurs, 17 per cent of immigrants start a company in the UK.
Rather than make these points, politicians have delivered rhetoric with no clear sense of policy. They have raised fears among businesses about the risk of actions that would damage our competitiveness, or that would be incompatible with continued membership of the EU, in which free movement of people is a central principle.
The failure of politicians to fight on economics is all the more surprising because it would be politically expedient. Ukip has no real credible economic policy, and has failed to set out any realistic vision of a future relationship with our largest international trading partner if Britain left the EU.
Business must play a central role in the debate. The increasing proportion of firms that trade internationally see first-hand how the loss of our EU membership would hurt their competitiveness. Companies also see the indirect effects. Many global companies choose to locate their European operations in the UK, and would be far less likely to do so if we left the EU.
The best option for our economy would be for the UK to retain its EU membership, and for the government to fight for the reforms that matter most – those that will create growth and jobs. It should prioritise finishing the Single Market, especially in services, and make it fit for the digital age. Pushing for free trade deals with the US, Japan and other major players, and streamlining regulation to become more efficient, are also vital. These are the European reforms that will make the most difference for Britain.
Politicians need to show courage and make the economic case for our continued membership of the EU. That is where the UK’s national interest lies. Anything else puts politics in Westminster ahead of jobs across the country.