28/04/2015
The
Guardian and
others are parading
a report from the German think tank
Bertelsmann Stiftung which claims that leaving the EU could knock 14 percent, or £215 billion, off the UK economy. The report runs to a mere seven pages, and to describe it as "thin" would be a compliment, with no evidence of any serious working-out.
It is based on three scenarios, the "most favourable" having the UK receiving "a status similar to that of Switzerland or Norway". And even at that point, it falls apart. There is no direct equivalence between these two positions. Anyone who affords them the same status cannot be taken seriously.
But then,
Bertelsmann presents the "second most favourable scenario". This is one where there is no trade agreement with the EU, resulting in higher non-tariff barriers as well as to tariffs between the UK and EU. That paves the way for the "least favourable scenario" (which it calls "isolation of the UK"), where we "lose all privileges arising from the EU's 38 existing trade agreements".
Although the think tank concedes that the UK can reach new trade agreements through independent negotiations, it argues that experience has shown this to be a lengthy process. Moreover, it adds, the UK's negotiating power would be less than that of the EU.
What this then does is open up a sordid little squabble between Matthew Elliott, he of
Business for Britain, and Peter Wilding of
British Influence. Elliott on the one hand argues that the report imagines a world "where every negative and false assumption held by those in favour of remaining in the EU at-all-costs is true, and then gives this absurd doomsday scenario a cost in terms of GDP".
Wilding, on the other hand, asserts that the
Bertelsmann report is "another nail in the coffin for the Brexit vandals", claiming: "It is now obvious that leaving would be an act of national self-harm". He goes on to say: "If people want Britain to lose influence in the world, lose jobs at home and lose trade abroad then isolation is the answer".
This sterile spat, though, does nothing more than emphasise the absence of agreed exit plan, leaving the opposition free to invent whatever they want. Elliott, of course, is impotent. Having locked himself into the renegotiation meme, he is unable to offer anything sensible of his own â even if he was capable of producing it.
However, things are about to change. This week sees the completion of the first edition of
Flexcit, now running to 411 pages and 20 chapters, including much of the recent work on this blog and
Boiling Frog's studies on telecoms. Now we do have a plan.
As before, the publication is online can be freely downloaded from the link in the preceding paragraph, or from the menu at the top â where it will remain accessible.
The plan itself has stabilised on six stages, opening with the "Norway option" and other facets, in what might be called the "EEA-plus" option. Stage two deals with immigration and asylum, three addresses the need to create a genuine European Single Market, four looks at new policies for an independent UK, five sets out the global trading policy and stage six pursues ideas for domestic reform.
This is far more advanced than anything so far on the table and, contrary to the naysayers, is intended to deliver an economically neutral withdrawal. It will not add cost, but nor in the short-term, will there be any significant savings. In the longer term, the potential benefits are huge, but the initial reason for leaving is not economic. We leave because we want no part of a political union with the rest of the EU Member States.
With the first edition now complete (barring corrections), we are having what amounts to a launch at a private seminar in London on Wednesday. We'll build on it from there, rolling it out to a wider circle before we will commit to a public launch â the timing of which will depend on whether we are to get a referendum in 2017.
In the interim, I'll be working with the Robert Oulds of the Bruges Group to get
Flexcit published as a book, and we'll keep you appraised of progress. But never let it be said now that there isn't a comprehensive exit plan. There is.
