Wednesday, 23 January 2013

Economy and Jobs First

At the time when highstreet shops are closing and people across Medway and Kent are suffering we needed a government which is focused solely on growing our economy and drawing down our deficit. 

We needed a government which would not put the stability of inward investment, of house prices and of our future as a global tading partner at risk.

We all know that Cameron did not want a referendum. This has been extracted like blood from a stone because Cameron knows that this issue will define his premiership like it has every other Tory leader. 

And this will end badly for him; just suppose the British electorate are duped into thinking this mob have a clue about how to run our country; and what will happen next will be the cause of the instability. 

Immediately after May 2015 the focus will turn to the upcoming vote on membership and the Tory right wing flank will focus its efforts, not on seeking another term in office, but in spending the first two years of the next term trying to undermine their own leader, who it seems from his speech today will be taking a pro-EU stance.

The Tories will descend into a two year bout of internecine warfare at exactly the time the Eurozone will likely recover with direct investment flowing into countries with a certainty of remaining in the market. 

Cameron will fall because he cant win, which is the reason why this trap is one he has tried desperately to avoid.

If Cameron wins the ballot to stay in he will never be forgiven by the right of his party for 'selling out' on the core principles of leaving, and highly likely to have a leadership challenge from within his own ranks. This is clear because the majority of Tory voters and members are the same people calling for withdrawal. Those anti-Europeans - on losing - would topple him.

If Cameron loses he will likely resign causing an immediate leadership ballot; so resorting to a quicker transition of power to a more right wing candidate.

Assuming of course Cameron actually gets to 2017 and the Thatcherite rump (who would have even more power with a small majority Tory govt) would not put an end to him as soon as the legislation went through knowing his position was pro-EU.

Cameron has already alluded to the fact he only wants the job for another term; he has already made it clear to the public he expects to go. 

The press meanwhile will have a field day from 2015-2017 trying to find splits and divisions within the government and as a result the British public will tire of the political class even further. European leaders will be briefing on our scenario on exit and the terms of the subsequent agreement should we leave.

All of this of course will happen when Britain is trying to compete in a global economy for increasing direct investment and access to our market. No Asia-Pacific bank or company will look to Britain if we are not able to have access or influence policy in our own backyard. The United States has made its stance pretty clear that this is not in their interest; expect US companies to be making this pretty clear.

The reason why I cant support a referendum as defined today is pretty simple
  • Terms - Cameron did not define the terms; to what am I supposed to be voting to opt into; what type of Europe is he seeking to create? He wants a referendum on a position he has not defined to the public. Cameron took a pro-EU position today but to what? It was inconsistent and flimsy.
  • Timing - Britain needs stability in our economy. We have debt rating agencies threatening a downgrade of AAA status; we have a ballooning debt and a deficit reduction cycle in tatters and a Coalition which is focused more on putting stickly plasters on divisions then working
  • Tone - France and Germany will now effectively have an influence over our electorate. They will, through their own actions, decide the parameters and tone of the debate. They know Cameron wont leave but they also know they can define the terms or parameters of our referendum through their own actions or inactions.

Companies looking at investing in Britain from now to 2017 will be concerned; our credit rating; and future economic recovery depends on stability. Stability for our mortgages and stability for Britain.

Only last year I highlighted the case of Vestas which shut shop in Britain because of a lack of certainty on renewables. Companies in constrained times make important decisions based on government policy.  

Cameron claims to want to be in the EU, but for many in the Conservative Party, getting the Prime Minister to commit now to an in/out referendum is not about consent, but about exit. They are only interested in one outcome; and that is our withdrawal... all other ends justify the means. 

People such as Sir Martin Sorrell, the Chief Executive of WPP Group, Sir Roger Carr, the Chairman of Centrica, and John Cridland, the CBI Director-General, have all been clear in warning of the dire consequences for the UK in leaving the EU.

Sir Richard Branson said recently: 

"An exit would be very bad for British business and the economy as a whole.  The UK must not become a peripheral country on the edge of Europe.  This will be damaging to long-term prospects of British business and also in the country's ability to attract new international companies to set up and employ people in the country.”

Labour’s approach is that to get the best deal for Britain we need to be round the table with our allies in Europe, not shouting from the sidelines with one foot already out of the door.

I am clear, like many of the people I speak to, that the priority now must be jobs and growth. People are worried about their jobs and our high streets are in crisis. Our economy is stagnating and unemployment is too high.

That’s why I am so concerned that because the Prime Minister has shown he is just too weak to control his own party on Europe, and risks creating years of economic uncertainty that will put investment and jobs at risk – just at the time when we need them most. I blogged in 2007/08 that Cameron should have lanced this boil in a clause 4 type moment; but his modernising credentials failed him on this and many other issues; which is why the Tories did not win the election in 2010.

If Tories think a more right wing position is a sensible one to follow they are certainly heading in the right direction. It is a position which may win the election in 2015 because such things do have populist appeal; but courting populist appeal at a time when the world economy is in recovery leads to unintended consequences. 

I am clear that the EU needs to change and work better for people in here in Britain.

I appreciate that in the short term this will not be popular; I fully expect the Tories to be playing games with Labour's position in Westminster for short term political advantage; but government is about the medium-long term interests of Britain not short term polling to stop UKIP in 2015. With office comes responsibility.

Clearly David Cameron is a Prime Minister in office but not in power; imprisoned by party interest and it will be his ultimate downfall.

So as Labour, we will make the hard headed, patriotic case, founded on the national interest, both for Britain in Europe, and for change in Europe.


  1. One of the features of Medway Council in more recent (enlightened) years is that it has sought European Funding for many local activities, including community projects such as we see in Luton and Chatham. Has anyone thought what would happened to these if we left the EU? What might happen?

    1. if we have more europeans living here then yes europe should fund them