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Express: We must get ready to turn our backs on Brussels

Date: 01 01 2018

We must get ready to turn our backs on Brussels: OWEN PATERSON

DON’T be taken in by the double-talk of the Remoaners. Brexit means taking back control of our laws, money and borders.

This same message was central to the Prime Minister’s speech at Lancaster House in January, in which she confirmed that we would be leaving the single market and the customs union. 

The reasoning behind this approach is clear: while we are members of the single market, we are bound by the free movement of people – so we cannot control our borders – and both membership of the customs union and the single market controls our international trade policy.

Plainly, any negotiated “deal” that kept us inside these pillars of the EU – or in a purgatorial state of perpetual alignment with them – would not deliver what 17.4 million people voted for in June 2016. 

But leaving the single market and the customs union is more than just consistent with the referendum result. It is an essential part of seizing the opportunities and reaping the rewards that Brexit can bring. 

Cardiff University economists, for instance, predict that Brexit will lower consumer prices by around eight per cent — benefiting the poorest households most of all — and raise national output by seven per cent, or £135 billion each year.  

The reduction in food prices alone would represent a saving of £305 per household per annum. 

By 2025, they predict that three per cent growth will give the Government an additional dividend of £65 billion per annum to spend on public services and/or tax cuts. 

The famous £350 million per week for the NHS (£18.2 billion per year) will be easy to achieve, along with money to support our farmers.

Eurofanatics claim that we must remain in the single market as if it is the only way to continue our trade with Europe. 

It is true that exporters to any market have to meet its standards, and British exporters to the EU will continue to meet European standards and regulations. 

But only 12 per cent of our GDP is a result of exports to the EU, so why should the majority of our exporters continue to be clobbered with EU red tape unnecessarily? 

What’s more, the proportion of our goods exports to the EU is falling, from 61 per cent at the start of the century to under 50 per cent in 2015 and is expected to drop further to 35 per cent by 2025. Sticking to EU regulation beyond Brexit could potentially damage our future ability to trade around the world.

Furthermore, applying single market rules means we cannot negotiate with any other countries or play any kind of role (let alone a leadership one) in the World Trade Organisation (WTO), which governs all global trade outside the ever shrinking EU. 

We would forego all the potential gains of reducing the hidden barriers that afflict our services sector – the second biggest in the world.

Outside the single market and customs union, we will be best placed to exploit the opportunities to be found in the fastest growing parts of the world (all outside the EU). 

Australia, Canada, Japan, New Zealand, South Korea, the United States and others will be watching the negotiations closely, knowing that they will only be able to do deals with an independent United Kingdom in full control of our own laws.

So, after Brexit we must take a world lead in advocating global free trade. If the EU wants to stick to protectionism, to burdensome regulation, to its extreme aversion to innovation, then so be it. The Government has tried to make the EU see sense. 

It has been clear from the outset that a reciprocal free-trade agreement with zero tariffs is in all our best interests. 

But if the EU will not agree heads of terms by March next year or if the price — either financially or in concessions of sovereignty — is too high, then we should politely advise them that our trade will continue on WTO terms, maintaining such reciprocal sectoral arrangements as mutual aviation landing rights. 

Some have cast this as a leap into the dark, falling off a cliff or any number of hysterical images. It is not. These “WTO Plus” terms would provide known, global rules. As a full member of the WTO and other similar international bodies, we would have a full say in shaping those regulations.

WTO holds no fears for us. The Chief Executive of Revenue and Customs, Jon Thompson, echoed these sentiments in his helpful, level-headed comments to House of Commons select committees in recent weeks.

He has indicated that by using new technology and expanding our use of Authorised Economic Operator schemes, our trade can continue without the ruinous so-called delays peddled by scaremongers and without the need for customs posts on the Irish border. 

Such an outcome is not in the EU’s best interests, however. We run a monumental trade deficit with the EU around £80 billion each year and the prestigious Ifo Institute in Munich has calculated that WTO tariffs – if we chose to impose them – would cost the EU 44 billion euros a year and thousands of lost jobs.

The UK is, therefore, in a strong position as the negotiations continue. The EU is clearly concerned about an end to our contributions to its bloated budget. But if they want our money, they must be prepared to talk about a reciprocal free trade deal. 

If they do not, we must be prepared to walk away, paying not a penny more than we legally owe and separately advancing our global trade talks.

Mrs May has been very generous to the EU so far, but she does not need to make further concessions. 

As she contemplates her New Year’s resolutions, I suggest she gives the EU until March to agree heads of terms, and – if they spurn her friendly advances again – plans seriously for the WTO outcome to give business and our administrators the certainty and time to prepare which they need.

January 1st, 2018: Express