EU referendum

EU referendum: pros and cons of Britain leaving Europe

Jul 20, 2015

An in/out referendum on Britain's membership of the EU will be held in 2017 - if not before

The Conservative election victory in May activated a manifesto pledge to hold an in/out referendum on Britain's membership of the EU before the end of 2017, with expectations rising that it could be held next year.

The prospect of meaningful parliamentary opposition to the referendum evaporated when Labour's temporary leader Harriet Harman reversed her party's position and backed an EU referendum. Whoever it elects as its leader, Labour is likely to campaign for continued membership of the EU.

David Cameron promised to deliver a referendum at a time when he was under pressure from Euroscpetic backbenchers within his own parties - and when the Conservatives appeared to be losing votes to Ukip.

He has argued the case for remaining in the EU, provided that key reforms are made, but reluctance from within the EU for such changes could thwart his plans. The PM's position was strengthened by his unexpected election victory, and he will be hoping to use the prospect of a UK vote to leverage major concessions.

So what are the advantages and disadvantages of being a part of Europe? And would Britain be better off staying inside the club or going it alone?


The pros and cons of leaving the EU

Perhaps the greatest uncertainty associated with leaving the EU is that no country has ever done it before, so no one can predict the exact result. Nevertheless, many have tried.

Trade: One of the biggest advantages of the EU is free trade between member nations, making it easier and cheaper for British companies to export their goods to Europe. Some business leaders think these savings outweigh the billions of pounds in membership fees Britain would save if it left the EU. The UK also risks losing some of its negotiation power internationally by leaving the trading bloc, but it would be free to establish trade agreements with non-EU countries.

Ukip leader Nigel Farage believes Britain could follow the lead of Norway, which has access to the single market but is not bound by EU laws on areas such as agriculture, justice and home affairs. But others argue that an "amicable divorce" would not be possible. The Economist says Britain would still be subject to the politics and economics of Europe, but would no longer have a seat at the table to try to influence matters.

A study by the think-tank Open Europe, which wants to see the EU radically reformed, found that the worst-case "Brexit" scenario is that the UK economy loses 2.2 per cent of its total GDP by 2030. However, it says that GDP could rise by 1.6 per cent if the UK could negotiate a free trade deal with Europe and pursued "very ambitious deregulation".

Jobs: Free movement of people across the EU opens up job opportunities for UK workers willing to travel and makes it relatively easy for UK companies to employ workers from other EU countries. Ukip says this prevents the UK "managing its own borders". But, writing for the LSE, Professor Adrian Favell says limiting this freedom would deter the "brightest and the best" of the continent from coming to Britain, create complex new immigration controls and reduce the pool of candidates employers can choose from.

Regulations: Eurosceptics argue that the vast majority of small and medium sized firms do not trade with the EU but are restricted by a huge regulatory burden imposed from abroad. However, others warn that millions of jobs could be lost if global manufacturers, such as car makers, move to lower-cost EU countries, while British farmers would lose billions in EU subsidies.

Influence: Britain may lose some of its military influence – many believe that America would consider Britain to be a less useful ally if it was detached from Europe.

On the plus side, The Economist says Britain would also be able to claim back its territorial fishing waters, scrap caps on limits to the number of hours people can work per week, free itself from the EU's renewable energy drive and create a freer economic market. This would turn London into a "freewheeling hub for emerging-market finance – a sort of Singapore on steroids", it says.

But it concludes that the most likely outcome is that Britain would find itself "as a scratchy outsider with somewhat limited access to the single market, almost no influence and few friends. And one certainty: that having once departed, it would be all but impossible to get back in again."


EU referendum: the big questions for Britain

When will the EU referendum be held?

The date is not yet known, although David Cameron has committed to holding it before the end of 2017. Some observers have suggested that the pace with which he has begun negotiations suggests that he is planning to call the vote next year, in order to avoid a long period of uncertainty that might hurt businesses.

What will the referendum ask?

The Electoral Commission has recommended the following wording for the referendum question:

Should the UK remain a member of the EU?"

This may give the pro-EU camp an advantage by putting it on the Yes side of the campaign. Last year, when Scottish voters were asked whether Scotland should be an independent country, pro-Union campaigners are thought to have been hindered by the negative associations of voting No rather than Yes - although they did eventually win the referendum. The question also reminds voters that the UK is already a member of the EU, and that a Yes vote would maintain the status quo - usually the more popular option when it comes to deciding a nation's future.

If a referendum were held tomorrow, what would happen?

One of the latest polls carried out by YouGov found that 45 per cent of people would vote for Britain to remain a member of the European Union, while 35 per cent said they would vote to leave. Another four per cent said they would not vote and 16 per cent were undecided.

Who is campaigning on each side?

The official campaigns have yet to be established, but already the leadership wrangling has begun. Many Ukip members believe their party leader, Nigel Farage, is the natural figurehead for the No campaign, but Conservative euro-sceptics have said one of their number should lead the charge. Farage is too divisive, they say, and would allow Yes campaigners to paint the anti-EU movement as backward-looking and xenophobic.

What does British business say?

Most business leaders are thought to be strongly in favour of staying in the EU, but all the early running has been made by a business-focused anti-EU group. Business for Britain is led by the former chief executive of the right-leaning think-tank, the Taxpayers' Alliance, and funded by the Daily Telegraph. Its supporters include the director general of the Institute of Economic Affairs, Mark Littlewood, and the chief executive of fund management business Newton, Helena Morrissey CBE, John Caudwell, founder of Phones4u, Peter Goldstein, co-founder of Superdrug, Sir Stuart Rose, former chairman of Marks and Spencer, and Next chief executive Lord Wolfson.

What about the rest of the business community?

As a whole, entrepreneurs and business owners in Britain broadly remain in favour of remaining a member - and their enthusiasm may be growing. According to the Financial Times a survey of 3,800 businesses earlier this year found 63 per cent believe that leaving the EU would have a negative impact for Britain, a rise of 4 percentage points since the end of 2014. The sentiment seems to be reciprocated: of 2,600 senior executives in 36 countries across Europe in February, nearly two-thirds of those in the eurozone said a British exit from the EU would have a negative impact on the European economy.

The back-story: how and why was the EU set up?

After the Second World War, Winston Churchill proposed "a structure under which [Europe] can dwell in peace, in safety and in freedom... a kind of United States of Europe".

At the time, the proposal was broadly popular in Britain, but when the European Coal and Steel Community was founded in 1951 with the aim of making "war not only unthinkable but materially impossible", Britain stood aside.

Britain also declined to join the European Economic Community, when the six founding nations –  Belgium, France, Italy, Luxembourg, the Netherlands and West Germany – signed the Treaty of Rome in 1957.

Britain relented in 1961 and applied to join the EEC after watching France and Germany's economies show signs of recovery. But its application was rejected not once but twice because the then French President Charles de Gaulle saw "deep-seated hostility" in the British attitude towards Europe.

Ironically it was the Conservative Party that eventually led Britain into Europe in 1973, with the more sceptical Labour party promising a referendum on whether the country should stay in, leave or seek renegotiated terms. When the referendum was held in 1975, the main political parties and all national newspapers campaigned for a vote to stay in the EEC, a stance backed by 67 per cent of voters.

Over the next two decades Britain's relationship with Europe became more complex, with Margaret Thatcher expressing deep antipathy towards the project. In 1992, however, her successor John Major signed the Maastricht Treaty, which created the European Union and the single pan-European currency (though Britain later opted out of that).

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A chain is as strong as its weakest link. Think of Spain, Portugal, Greece, and the answer is clearly "Yes, Britain would be better out of the EU". Its hard to soar like an eagle when you are surrounded by turkeys.

The current version of the EU with its emphasis on political and financial unity bears no resemblance to the trade zone we originally voted to join,aside from Germany and the UK only the eastern member states are showing any domestic growth,France,Italy and Spain are barely treading water,if the EU is to prosper it must return to its original concept,the euro has been a disaster and the drive for political union has been totally undemocratic.

Cameron should get off the EU fence and commit himself to either the YES or NO to Europe. He should lead not be led. The longer he sits on that fence he would only damage his rear.

Hopefully he will damage himself sufficiently that in a year he will be returned to the ranks of no-account posh boys with no idea about real life. Heard him on the radio the other day being interviewed, he was asked pointedly and repeatedly about the trashing he'd taken at the hands of UKIP, and all he could talk about was his superiority over Miliband. We need rid of such people, who neither lead nor follow, just muddy the waters and make themselves rich in the process

Let's get a bit provocative, shall we? Mr. Cameron quite clearly fails the courage to make up his mind: staying in or leaving the European Union. Besides, maybe the EU would be better off without the fickleness and obstruction of Great Britain, since this former world power may still have the pretension to be "Great", but has no longer the means nor the influence to claim that adjective. Besides, suppose the Scots do decide for their independance in September and ask for membership to the EU, where would that leave Merry Old England? In the dark and cold shadows of a once bright and glorious past? And with charming Nigel Farage as PM? Little Britain as a reality show.

TWe would be far better off leaving the EU. It costs us a fortune just to be a member--we are one of only two or maybe three contributors (Germany is a contributor and maybe a scandinavian country)--the rest are beneficiaries--they get far more than they pay in. The EU has destroyed many of our traditional industries--too numerous to mention here. It has the last word over our laws. The open borders mean that we are vastly over-populated. A tiny wee island sinking with about 70 million people all crammed together--far too many--by far. We have a trade deficit with the EU--they sell much more to us than we sell to them--so they gain from trade. The best countries, and most lucrative economies are ALL OUTSIDE THE EU. The EU is the past--countries in Asia , South America etc.--are where the future is. (and do not forget Australia , Canada, the USA and New Zealand.
The sooner we leave--the sooner we start to save money and reduce our one and a half trillion pounds deficit--a national disgrace.

The chain analogy is completely wrong. It was clear from the analysis above we would be taking massive risks if we decided to leave. try to put a value on the things we would lose (e.g. much manufacturing).

You sound like a Kipper...willing to grab any silly point that seems to support your pre-conceived policy position; sadly, there are many Kipper types who grab at the same nonsenses.

"There would also be costs"

FFS Kippers, read what followed that. Then try to think.

...with freedom come risks! We risked annihilation when we declared war on Germany over Poland in 1939. This nation now lacks confidence and leadership - not courage and enterprise.

Firstly, Winston Churchill did propose a United States of Europe, he also said that the UK should play no part in it.

Secondly a country technically has already left the EU, namely Greenland.

Yes of course there would be risks like anything, there are risks staying in and its costing us massively to do so.

There would be a few years of turmoil until it finally settled down. The Norway and Switzerland analogy is totally wrong, we are far more than these 2 countries. We import more than we export to the EU so they wont want a trade war with us it would cost them dearly. Besdies we are exporting less and less to the EU every year. We also had to end our trade relations with the anglosphere to join the EU and look what a disaster that's been. You look how well anglosphere countries are doing compared to EU countries. We would gain much back, control of our borders, our fishing grounds our right to trade with who we want.

What a load of rubbish. Mind you the EU would be better off without the UK, unfortunately they need our money and our military which is why they put up with us. As far as the EU is concern the UK makes no contribution apart from the above. My wife who is French worked for them for 4 years she knows exactly what the Eurocrats think of the UK and the British people and its certainly not nice.

What is all this FFS Kippers crap. Why dont you try thinking nugget. We know there would be costs, but they are worth it. Well obviously not to you you cave dwelling moss licker.

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