Economy and Finance — House of Lords, 2016-06-09
Topic: Foreign Trade
John Warren Shipley (Liberal Democrats, Centre to centre-left): My Lords, I am grateful to the noble Lord, Lord Haskel, for giving us the opportunity to have this extremely important debate. I am glad that its context concerns the prospects for our economy. It is always a pleasure to follow the noble Lord, Lord McFall. I agree with his words: our prospects are grim if we leave the European Union. We are one of the world’s largest economies, but we are so because we are in the European Union, not because we are outside it I want to put this debate into the context of the north-east of England—where I live—our manufacturing base there and this referendum debate. The north-east of England is a manufacturing and exporting region. Many thousands of jobs—around 150,000 in the north-east of England and millions across the UK—depend on exporting to our European partners. Leaving the EU’s single market, which is the world’s largest free trade zone, would hit our trade and investment and increase unemployment I am proud that, because we make things, my region has a positive balance of trade. We manufacture cars and now we manufacture trains. We have huge supply chains in support of our manufacturing. It would increase unemployment significantly if we voted to leave the European Union. The north-east of England simply cannot afford the cost of Brexit. It would be a massive own goal disrupting our economy and the livelihoods of very many households Last year, 44 foreign inward investment projects came to the north-east, but this will be put at risk if we leave the EU. Why would an overseas company seeking to expand in the EU want to put itself outside the single market, facing tariff barriers to its exports? The north-east needs access to the EU single market of 500 million people, with a say over the rules of doing business across Europe. That means more jobs and more financial security for our region In addition to manufacturing, sectors such as farming, science, higher education, tourism and hospitality would also be adversely affected by Brexit, and the north-east of England would lose access to hundreds of millions of pounds of EU funding for regional development. The success of our universities relies heavily on EU research funding and our businesses rely on free movement of skilled workers both to and from the UK to drive growth and jobs As the noble Lord, Lord Haskel, pointed out, manufacturing still provides half of our country’s exports, three-quarters of scientific innovation and 2.5 million jobs. Almost all UK economists support our remaining in the EU but, amazingly, one economist who favours Brexit—Professor Minford—has admitted that if we left the EU it seems likely that we would mostly eliminate manufacturing. This is unacceptable. We need manufacturing and the innovation, jobs and growth it can bring. Car manufacturers and rail manufacturers—indeed, all manufacturers who export or plan to export—want access to the European single market to enable them to trade freely on common technical standards. Small businesses need the same because they form part of the critical supply chain to bigger businesses The EU helps all these industries by eliminating both tariff and non-tariff barriers. The next stage of development of the single market will bring down the remaining barriers to trade in services, energy and digital industries, which will be hugely beneficial to the UK. Our success at manufacturing and in the north-east of England depends on our continued membership of the European Union. In the north-east, the warnings from Hitachi and Nissan need to be taken seriously. They want us to be in the single market and their views matter profoundly. The north-east needs the jobs and the prosperity they bring The prospects of the north-east of England depend on our being part of the EU and its single market. Voting to leave would do immense damage to our economy, to our growth prospects and to the prospects of our next generation.