If this government wants us to know one thing about its objectives at the moment, it is that economic growth is their priority. From infrastructure investment, to planning reform and even pensions, growth is the thread running through all recent government announcements. Whether or not you agree with every decision, it is hard to argue that this is the wrong priority. Low economic growth, underpinned by dismal productivity growth, is the root causes of so many problems we face, from low living standards, to struggling public services. The government is also right to argue that politics has often been the enemy of sensible economic policy in recent years, and to consider putting their large majority to work in overcoming political barriers.
It is time that this line of thinking, which has been used to great effect in other areas, is applied more systematically to the problem of resetting our relationship with the European Union. Ever since the referendum, our political debate on Europe has been driven not by a rational assessment of our national self-interest, but by a desire to be seen on the ‘right side of the debate’. Detail, evidence, and expertise have been drowned out by cries of betrayal and simplistic answers that don’t survive contact with reality. The result has been a deal with Europe that doesn’t work for anyone. Businesses have been hit by a mountain of complicated rules and new compliance which has dented business investment and limited ambition. 20,000 small firms have stopped exporting to the EU altogether, and overall export performance has lagged significantly behind other OECD countries. New visa rules have inhibited access to talent in sectors like science which are inherently collaborative and our creative industries- one of the fastest growing sectors of our economy- has been help back by restrictions on people working on location or touring. The cumulative impact to our economy is significant.
Any government serious about growth needs to be serious about resetting this relationship, and this means taking on those who will want to take us backwards and refight the referendum at every turn. It also means trusting that the British people are ready for a grown-up conversation and have limited desire to go over the old ground, no matter how much certain politicians want to drag us back there. We simply cannot go on allowing fear of the populist right to shape one of our most important economic relationships, especially at a time when global economic uncertainty means Britain could be left exposed and vulnerable.
So government needs to be bold in the upcoming renegotiation, focusing on the art of the possible, and resisting the temptation for too much focus on so-called ‘red lines’. The recent engagement with the EU on defence and security is an encouraging start. But if government needs to be bold, so too do the rest of us. As the new Chair of the Domestic Advisory Group, representing business, trade unions, and civil society in the renegotiation process, I am clear that we need to find our voice on these issues again. For too long there has been an element of self-censorship, partly born out of exhaustion at the fall-out from the never-ending Brexit battles. I understand the reticence to reopen this debate, but there is a renegotiation coming, and if we are not going to lead the way in shaping a new narrative on our relationship with Europe, then who is?
The recent debate over customs and the PEM is a welcome step in the right direction, and the kind of solution-based thinking that is needed. But the list of issues is long. We need to solve the issues in our aviation sector, unlock greater environmental collaboration, and tackle shared security challenges. And yes, there are important issues around rights at work that need to be addressed as well so that both workers and businesses can share in the benefits of a new deal. When the prime minister meets with EU leaders in the coming months, he does so with the support of all of us in UK civic society who believe that a better deal with Europe will be good for growth, and good for Britain.
If you enjoyed this piece, click here to read another piece on Labour’s growth agenda.
