During the referendum, one of the key arguments of the Remain campaign was that British jobs would be badly affected if we left the European Union. But in reality, the UK’s EU membership imposes huge burdens across the length and breadth of our economy – and all for the sake of a small minority of firms which export to the continent.
Brexit, combined with an ambitious free trade deal, offers British business the best of both worlds: freedom from onerous regulations for domestic companies and global exporters, and ongoing access to the EU market for firms which trade there.
Did you know that only six per cent of British firms export to the EU? Of these, a disproportionate number are large companies, with expensive and well-staffed legal departments to handle the huge number of laws and regulations governing EU trade.
But unlike a normal free trade agreement, at present the EU’s rules don’t only apply to companies exporting into the European market – they apply to every business in Britain, from largest to smallest. This means that hundreds of thousands of small businesses are affected, even if they only trade here in Britain.
Did you know, for example, that the EU courts have forbidden governments from exempting small businesses – even those with ten employees or less – from Brussels’ time-consuming health and safety assessments? Or that it forces even a gardener, who transports a small amount of garden waste, to formally register as a ‘waste carrier’?
The EU even has rules governing how the Government should build things like schools and hospitals (which have nothing to do with international trade), enforcing complex rules which make tendering for public contracts an expensive and time-consuming proposition.
All across the economy, Brussels’ rules favour big, established companies that know how to play the game. Yet it is small and medium-sized enterprises (SMEs) which are overwhelmingly responsible for the UK’s outstanding record of job-creation since 2010. Every burden placed on small businesses means time and money Britain’s entrepreneurs can’t spend creating prosperity and jobs.
The right free trade deal can change all that. Numerous countries have trade deals with the European Union which don’t involve Brussels setting the rules for their domestic economies. If countries such as Canada and South Korea can strike that sort of trade deal with the EU, so can Britain – and once that happens, British SMEs will suddenly have much more time and capital to hand.
But what about those companies which do export to the EU? Well, under a free trade deal they will continue to apply Brussels regulations when exporting to Europe – just as they follow Washington regulations when exporting to America.
Even really time-critical cross-border trade, such as ‘just-in-time’ supply chains, can operate perfectly well under normal international trade rules, as they do between the United States and Canada. That’s why so many car manufacturers have continued to invest in modernising and expanding their UK plants, despite numerous warnings from politicians that they would have no choice but to relocate to Europe.
Moreover, once outside the tariff walls of ‘Fortress Europe’ the UK will be able to do much more to support exporting business, from exempting them from VAT (thus saving tens of billions wasted every year claiming refunds) to opening up new markets around the world with new trade deals.
EU membership has stifled British entrepreneurs in favour of a small minority of established firms trading into one of the world’s slowest-growing markets. Far from threatening jobs, the right Brexit free trade deal will help to unlock the full job-creating potential of UK SMEs – and boost our exporters too.