Tuesday, 14 June 2016

The EU Referendum

The EU referendum is too important to not get involved and try and make a difference. In fact, the British public agree on how important it is. In a recent YouGov poll, 76% of respondents said that the result of the EU referendum was more important to them personally than the result of the next general election.

I will be voting Remain and will do so without a second of hesitation. It is no secret that the key to Remain winning the referendum is a high turnout. This is because when there is a low turnout, it is young people who are the first to not bother voting and polling data shows that 43 is the age when a majority of people begin to support "Brexit".  It is because of this reason that UKIP's Arron Banks, the man bankrolling Leave.EU (an unofficial "out" campaign) has said he plans to "bore the electorate into submission" so that they don't vote.

Both Vote Leave (the official "out" campaign) and Leave.EU seem determined to confuse voters with nonsense arguments and deliberately misleading statements so I would like to dispel a few myths that have formed the basis of their campaigns. To do this, I will take Vote Leave's "5 positive reasons to leave the EU" and point out, what I consider to be, massive holes in their arguments. If any of these reasons are the reason you are considering voting to Leave, then please consider whether you want to vote based on a falsehood.


1. "Our money, our priorities"

Vote Leave claim that we send over £350m to the EU every week. The figure they are referring to is our "gross contribution to the EU", which is actually £361m a week.

However, before this is paid to the EU, we get a rebate. This rebate was negotiated under Thatcher because the calculation to work out each country's gross contribution worked out poorly for the UK. This wasn't by design; the calculation was invented before the UK joined. I won't go into the mechanics of the calculation but as a result of the rebate, the UK actually only pays £276m a week (less than 80% of the figure claimed by Vote Leave).

What should also be considered is that out of the money we give to the EU, about 40% comes straight back to the UK to fund (amongst other things) agriculture, regional development and universities. This leaves the actual cost of our EU membership at £161m a week. This works out at about £300 per year per household. This might still sound like a lot of money but, as with any membership, we get a whole host of benefits from being a member, some of which I will talk about later on.

2. "Take back control of our laws"

This "positive reason" is quite self-explanatory; Vote Leave claim that by leaving the EU, we can take back control of our laws. There are so many things wrong with this argument.

Firstly, UKIP have claimed that 75% of UK laws were made in Brussels. This is not true. I'll admit that no-one knows the exact figure and the amount depends greatly on what you consider to be laws and what you consider "made in Brussels" to mean.

The upper end of actual estimates carried out by the House of Commons library is 50% but the figure could be as low as 15%. In reality, the figure is likely to fall somewhere in between; that's about one third of UK laws that have been made in Brussels.

Regardless of how many laws are made in Brussels, there is a fundamental flaw in this argument about taking back control. Contrary to claims by Boris Johnson, these are not laws such as "we can't recycle teabags" or "children under 8 can't blow up balloons" or "we can't sell bananas in bunches of more than three". Boris has claimed all three of these rules have been imposed on us by the EU but not a single one of them is true. Rather, many EU laws are there to improve safety, save the environment and improve competitiveness in the single market.

Finally, these laws, for the most part, have not been imposed on us by unelected bureaucrats in Brussels. The laws, I accept, will have been proposed by the European Commission - a body made up of "unelected bureaucrats" in the eyes of Vote Leave, or professionals who assess the economic, social and environmental impact of different policies in the eyes of Stronger In. By the way, this is no different to UK laws being proposed by the Civil Service. Furthermore, contrary to popular belief, the EU isn't some behemoth, employing countless bureaucrats. The EU employs around 50,000 civil servants to run an organisation that oversees a population of around 500 million (one per 10,000). To give you a point of reference, the UK government employs over 400,000 civil servants to run a country with a population of around 60 million (one per 150).

The laws are then amended by the European Parliament, an elected body, the members of which every EU citizen (of voting age) can vote for. The laws may also be amended by the European Council, the 28 elected heads of state or government for each Member State. Both the Parliament and the Council have to agree on new EU laws.

If a qualified majority (at least 55% of Member States representing at least 65% of the EU population) votes to implement a law, then all Member States must accept it. This means that laws can occasionally be imposed on a Member State against their will. So how many EU laws has the UK voted against? Just 13%. That's right, of the however many laws Vote Leave claim the EU has "imposed" on us, elected British representatives have voted in favour of 87% of them.

Finally, on this point, the Vote Leave leaflet states "If we vote to remain... the European Courts will be in control of... big decisions like whether prisoners are allowed to vote". Admittedly, this is true. What Vote Leave do not tell you, however, is that if we vote to leave, the European Courts will still be in control of big decisions like whether prisoners are allowed to vote. The reason for this is that it was the European Court of Human Rights which said that we must allow prisoners to vote in the UK. This is because we are signed up to the European Convention on Human Rights, something which has nothing to do with the EU. I have discussed this in more detail in a previous blog post, which can be found here: Human Rights Act.

3. Build a fairer, safer immigration system

Interestingly, the Vote Leave campaign makes very few claims under this heading on their leaflet and it includes no specifics on how leaving the EU would make our immigration system fairer and safer. I suspect this is because most of the reasons they have implied - for the most part, and explicitly stated on occasion - over the course of the campaign have been based on: no evidence; in spite of evidence to the contrary; or are xenophobic. These claims include:

  1. Immigrants take our jobs
  2. Immigrants take our benefits
  3. Immigrants are criminals
  4. Turkey will soon be joining the EU
I'm sure many of you may have noticed that claims 1 and 2 seem to be contradictory, but nevertheless, I will try and assuage any worries you may have as a result of these.

Firstly, new research from the London School of Economics (LSE) has found that immigration does not keep down wages or lead to an increase in unemployment amongst indigenous citizens; immigrants don't even disproportionately take new jobs. Combine this with the fact that UK employment levels are at an all-time high and this argument is just absurd.

So if they're not taking our jobs, they must be claiming millions of pounds in benefits, right? Well, some EU migrants do claim benefits; I can't deny that. However, research by UCL in 2014 found that migrants from the EU had paid £20bn more into the government coffers in tax over the first decade of this millennium than they had taken out in benefits.

So they don't take our jobs and they pay more than their fair share of tax, but immigrants are criminals, aren't they? Some are, yes, but are immigrants any more likely to be criminals than native Brits? No.

Speaking broadly, foreigners are no more likely to be criminals than native Brits; 13% of the prison population in the UK are foreigners compared to 13% of the population as a whole. However, it seems to be specifically Eastern Europeans being targeted by UKIP. So, it seems important for you to know that a fairly recent study has found that the crime rate amongst Eastern European immigrants is also the same as that amongst native Brits.

Finally, the latest tactic of Vote Leave is talking up the "threat" of Turkey joining the EU and I understand the concern. However, this is not because of the extra immigration this might bring, but because I wouldn't want a country with such an awful human rights record in the EU. Fortunately, Turkey cannot join the EU unless all 28 Member States and the European Parliament approve. Given that Germany are officially opposed to Turkey joining, and so are the largest party in the European Parliament, I can't see this happening anytime soon. Furthermore, the European Commission (made up of the 28 heads of state or government) have said no more countries will join the EU for at least 5 years.

It appears that immigration is good for our economy, and obviously there are other factors invloved but it is the economy that a majority of voters have said is the most important issue in this decision, and it is the easiest thing on which we can measure the impact. Whether you think immigrants are improving or damaging British culture is a matter of opinion but a recent survey found that 55% of people (with an opinion on this matter) say that British culture is enriched by immigration.

It is also really important that people appreciate that the freedom of movement works two ways! Just as EU migrants come to the UK, British citizens are free to travel, live and work in other EU countries. We don't need visas to go on holiday in the EU, we don't need visas to live in the EU and we don't need visas to work in the EU. The most recent figure I have seen estimates that 1.26m Brits live elsewhere in the EU. In fact, my girlfriend currently lives and works in Germany and it was as easy for her to do so as it would have been for her to live and work in Manchester and at least she can understand Germans!

4. Free to trade with the whole world

The Vote Leave campaign claims that we will be better off outside the EU because we will be able to negotiate our own free trade deals with other countries around the world such as China and India as opposed to having to negotiate free trade deals as part of the EU.

However, being part of a bigger market, such as the EU, gives us much more bargaining power when it comes to negotiating free trade deals. Professor Ngaire Woods from Oxford University can explain this much better than I can, so I strongly recommend you watch this video: Ngaire Woods on Brexit and Free Trade.

Secondly, the most important market for UK exports is the EU. About half of British exports are to the EU and this is of little surprise. The EU is the biggest single market in the world, and it's right on our doorstep. Therefore, if we were to have free trade with just one other economy, the EU would be the logical choice. Many people take for granted not only the fact that we can import from and export to the EU with no tariffs or duties, but other barriers to trade are removed by our membership of the single market. Being a part of the single market means there is a level playing field between businesses from all 28 Member States, which increases competitiveness and lowers prices. Being part of the single market means that the same rules and regulations for goods and services apply in all 28 Member States, which increases efficiency and lowers prices. Why would we want to sacrifice this?

Yes, it is possible to be part of the single market without being part of the EU - this is the case for Norway. However, Norway's contribution to the EU per capita is about 80% that of the contribution the UK makes per capita, yet Norway has no power to change any of the rules and regulations it is forced to implement to be part of the single market (which is over 90% of the rules and regulations implemented by full members of the EU). Furthermore, to be part of the single market, Norway still has to accept free movement of people, so if immigration is your main concern, staying in the single market isn't the answer.

Maybe being part of the free trade area but not the single market is the solution, as is the case for Switzerland. However, like Norway, Switzerland also pays into the EU budget (about 40% of the UK contribution per capita) and accepts free movement of people. Likewise, similar to Norway, if Switzerland wants to export into the EU's single market, it must accept most of the rules and regulations, which it has no control over. Furthermore, although there is one main free trade agreement which was signed in 1972, Switzerland and the EU have signed over 100 bilateral agreements on such issues as the freedom of movement of people. The Swiss parliament has 15 committees solely responsible for negotiating deals with the EU.

Free trade deals are not easy to negotiate and as we can see from Switzerland, it would be an ongoing saga. The Canada-EU deal has taken 7 years so far to negotiate and it has still not been ratified. I'm not suggesting a UK-EU deal would take this long; I'm sure there would be shortcuts due to our former status as a member of the single market, but do we want to spend years negotiating a free-trade deal when we already have access to the single market?

During this time, we would have to pay Customs Duty on anything imported from the EU. On the other hand, businesses in the EU would have to pay Customs Duty on imports from the UK meaning businesses in other EU countries would suddenly look a lot more appealing than UK businesses, damaging our economy and risking jobs. A study by LSE estimates that British households save £350 per year on shopping as a result of being a member of the single market. If you remember from earlier in this post, the cost per household of being a member of the EU was £300 per year. This is therefore an estimated saving of £50 per household per year by being in the EU just on this one factor alone!

5. Vote Leave is the safer choice

I feel that Vote Leave may have run out of reasons here as this one seems to be the other four regurgitated into one confused lie. Nevertheless, it provides me with a reason to recap why you should not believe Vote Leave!

The first claim here is that "we'll be locked in a car going somewhere we don't want to go". As I've said before, this is nonsense. We have a say in where we go or, at least, we would if we didn't elect UKIP MEPs who don't turn up to do their job! The biggest waste of money in the EU is probably the salaries of these MEPS who don't go to work and vote on issues that affect us. Regardless, as I mentioned earlier, British representatives have voted in favour of 87% of British laws.

The leaflet then claims that we'll keep subsidising other EU countries. This claim is true, but is it a problem? Firstly, it's not just other EU countries that are subsidised. Cornwall, the poorest region in the UK, will receive £800 per person between 2014 and 2020, and this will be spent on infrastructure to help Cornwall to catch up with not only the rest of the UK, but also the rest of the EU!

Poland is one success story of the EU. As a result of reforms it began to make in the early nineties as part of its negotiations to join the EU, and some EU funding (paid for by subsidies from richer countries such as Germany, the Netherlands and the UK), its economy has more than doubled in size in the last 20 years. As a result of this, the UK now exports over £4bn goods to Poland. This is roughly the same amount we export to India, the country with the second largest population in the world. This means UK businesses have many more customers, which means more jobs!

Furthermore, 2% of our imports now come from Poland. This is more than we import from Japan, the third largest economy in the world. This is important as it enables UK businesses to purchase goods more cheaply (due to increased competition, and lower transport costs), which means lower prices for us!

Finally, the Vote Leave campaign claims that by leaving the EU, we will have control over how we spend our money. I'm not going to make the same point about decision-making in the EU, but there is another problem with this claim. Many people don't understand how much money £161m per week is (the cost of our membership). It works out at £8.5bn per annum. That's a lot of money, but given that the UK government spends nearly £800bn per annum, it works out at just under 1.1% of the government budget. This means that by remaining a member of the EU, the UK government still has control over how it spends 98.9% of its budget.

The Vote Leave campaign claims that if we left, we could spend all of the money we send to the EU on the NHS. Again, this takes advantage of the fact that people don't know how much money is already spent on the NHS: £145bn per annum. Assuming government spending priorities stay the same, tax rates stay broadly the same, and using the forecast published recently by the Economist Intelligence Unit that the UK economy would be 6% smaller by 2020, spending on the NHS would actually decrease by leaving the EU. This is a crude calculation but it's clear to see that Vote Leave have no shame in continuously telling voters a vote to Leave is a vote to increase spending on the NHS by £350m a week.



Conclusion

Ok, so that's Vote Leave's "5 positive reasons to leave the EU" dispelled. So are there some positive reasons to remain in the EU? Of course there are.

1) Travel: Membership of the EU makes it incredibly easy to travel, work and live abroad! Not only because of visa-free travel but also smaller things, which people may not appreciate are linked to the EU. For example, the cost of using your mobile phone in any other EU country is currently about 25% of what it would be if we were outside the single market. From June 2017, it won't cost a penny extra to use your mobile phone elsewhere in the EU. Add in the fact that the pound is very likely to weaken with a vote to Leave (this is starting to happen based purely on the concern that we might leave) and there are concerns that the price of flights could increase, and those regular trips to Europe many of us now take for granted could soon be no more. UK residents went on 37.6 million holidays abroad in 2013, with 9 of the top 10 most popular destinations being members of the EU.

2) Science: Although the UK makes up less than 1% of the world's population, it produces 16% of the world's most influential journal articles. There are estimates that Brexit could mean a loss of £1bn to UK scientists, but it is not just funding we will lose. Being part of the EU enables easy cross-border collaboration. Over 50% of journal articles published by UK scientists are a result of collaborating with international scientists. If we leave the EU, we could pay to take part in the EU's science programme, Horizon 2020, but we would have no influence over it. Leaving the EU would be a hit to the UK's medical research charities of which we have some of the best in the world.

3) Sport: Not only does the EU fund some "grassroots" sport in the UK, but by being a member, it means the best footballers can easily come and play in the Premier League. It's estimated that two-thirds of European footballers currently playing in the UK would not meet automatic visa criteria if we left the EU and may have to leave. I'm sure many of these would be granted visas, but leaving the EU would add an unnecessary barrier and suddenly La Liga and Bundesliga would look even more appealing to the best European footballers.

4) The City of London: I know many people think London is too dominant in the UK to the detriment of the rest of the country - I disagree - but, through taxes, London's banks pay for 12% of government spending. One of the reasons London is the financial centre of the world is because it is part of the largest single market in the world. We would lose this if we left the EU.

5) Security: There is a lot of debate on whether the UK is safer inside or outside of the EU, and I am no expert on this. However, the two most recent former heads of MI5 and the most recent former head of MI6 probably are. All three believe the UK is safer as part of the EU.

6) The Environment: The EU has been instrumental in improving the environment and without it, I don't consider there to be any hope of tackling climate change. Because of the EU, we have clean beaches, unleaded petrol and an ozone layer. Without the EU, it is estimated that nitrogen oxide emissions from road transport would be 10x higher. The EU is an example to the rest of the world on the environment and it would be a big loss if Britain left.

 7) Peace: David Cameron's claims that World War Three could break out if we left the EU were probably misguided... but there is no denying that the EU has brought nearly 60 years of stability to a continent that had been torn apart by war countless times in its history.


If we are going to solve any of the world's problems, we will need to collaborate on an international stage. If we can't even collaborate with our neighbours in Europe, how can we hope to reach agreements on things such as climate change, poverty and tax evasion with countries further afield such as China, India and Argentina?

The EU has shown that international collaboration can work over a sustained period of time (nearly 60 years). It is not perfect, but we won't make it any better by voting to leave. In fact, we would be part of a weakened UK, isolated from a weakened EU.

What the EU needs is a convincing vote to Remain in the EU, followed by votes for MEPs who want to engage in and improve the EU and not those who do not turn up at all.

If you want the UK to be part of an international community that benefits everyone, then vote Remain on June 23rd. If you strongly believe a vote to Remain is the right choice, and I hope you do, then please share this! Sharing it with just one other person could make a big difference!


I appreciate this was an incredibly long post so thank you if you made it this far!

Ed

Saturday, 4 June 2016

The EU Referendum: Part 3

Before I conclude my mini-series on the EU referendum, if you haven't already, please read my previous blog posts as this one will make a lot more sense if you do. These can be found here:

The EU Referendum: Part 1
The EU Referendum: Part 2

If you have already read my previous blog posts, you will know that I have been using Vote Leave's "5 positive reasons to leave the EU" as a basis for my posts and I have one reason left to criticise before I move on to make some genuinely positive reasons to vote Remain!

5. Vote Leave is the safer choice

I feel that Vote Leave may have run out of reasons here as this one seems to be the other four regurgitated into a single, confused lie. Nevertheless, it provides me with a reason to recap why you should not believe Vote Leave!

The first claim here is that "we'll be locked in a car going somewhere we don't want to go". As I've said before, this is nonsense. We have a say in where we go or, at least, we would if we didn't elect UKIP MEPs who don't turn up to do their job! The biggest waste of money in the EU is probably the salaries of these MEPS who don't go to work and vote on issues that affect us. Regardless, as I said in Part 1, British representatives have voted in favour of 87% of British laws (and in fact, just yesterday, I saw a higher figure claimed!)

The leaflet then claims that we'll keep subsidising other EU countries. This claim is true, but is it a problem? Firstly, it's not just other EU countries that are subsidised. Cornwall, the poorest region in the UK, will receive £800 per person between 2014 and 2020, and this will be spent on infrastructure to help Cornwall to catch up with not only the rest of the UK, but also the rest of the EU!

Poland is one success story of the EU. As a result of reforms it began to make in the early nineties as part of its negotiations to join the EU, and some EU funding (paid for by subsidies from richer countries such as Germany, the Netherlands and the UK), its economy has more than doubled in size in the last 20 years. As a result of this, the UK now exports over £4bn goods to Poland. This is roughly the same amount we export to India, the country with the second largest population in the world. This means UK businesses have many more customers, which means more jobs!

Furthermore, 2% of our imports now come from Poland. This is more than we import from Japan, the third largest economy in the world. This is important as it enables UK businesses to purchase goods more cheaply (due to increased competition, and lower transport costs), which means lower prices for us!

Finally, the Vote Leave campaign claims that by leaving the EU, we will have control over how we spend our money. I'm not going to make the same point about decision-making in the EU, but there is another problem with this claim. Many people don't understand how much money £161m per week is (the amount we pay to Brussels that is spent by Brussels). It works out at £8.5bn per annum. That's a lot of money, but given that the UK government spends nearly £800bn per annum, it works out at just under 1.1% of the government budget. This means that by remaining a member of the EU, the UK government still has control over how it spends 98.9% of its budget.

The Vote Leave campaign claims that if we left, we could spend all of the money we send to the EU on the NHS. Again, this takes advantage of the fact that people don't know how much money is already spent on the NHS: £145bn per annum. Assuming government spending priorities stay the same, tax rates stay broadly the same, and using the forecast published yesterday by the Economist Intelligence Unit that the UK economy would be 6% smaller by 2020, spending on the NHS would actually decrease by leaving the EU. I'll admit that this is a crude calculation, but don't be lured in by this argument!


Ok, so that's Vote Leave's "5 positive reasons to leave the EU" dispelled. So are there some positive reasons to remain in the EU? Of course there are.

1) Travel: Membership of the EU makes it incredibly easy to travel, work and live abroad! Not only because of visa-free travel but also smaller things, which people may not appreciate are linked to the EU. For example, the cost of using your mobile phone in any other EU country is currently about 25% of what it would be if we were outside the single market. From June 2017, it won't cost a penny extra to use your mobile phone elsewhere in the EU. Add in the fact that the pound is very likely to weaken with a vote to Leave, and there are concerns that the price of flights could increase, and those regular trips to Europe many of us now take for granted could soon be no more. UK residents went on 37.6 million holidays abroad in 2013, with 9 of the top 10 most popular destinations being members of the EU.

2) Science: Although the UK makes up less than 1% of the world's population, it produces 16% of the the world's most influential journal articles. There are estimates that Brexit could mean a loss of £1bn to UK scientists, but it is not just funding we will lose. Being part of the EU enables easy cross-border collaboration. Over 50% of journal articles published by UK scientists are a result of collaborating with international scientists. If we leave the EU, we could pay to take part in the EU's science programme, Horizon 2020, but we would have no influence over it. Leaving the EU would be a hit to the UK's medical research charities of which we have some of the best in the world.

3) Sport: Not only does the EU fund some "grassroots" sport in the UK, but by being a member, it means the best footballers can easily come and play in the Premier League. It's estimated that two-thirds of European footballers currently playing in the UK would not meet automatic visa criteria if we left the EU and may have to leave. I'm sure many of these would be granted visas, but leaving the EU would add an unnecessary barrier and suddenly La Liga and Bundesliga look even more appealing.

4) The City of London: I know many people think London is too dominant in the UK to the detriment of the rest of the country - I disagree - but, through taxes, London's banks pay for 12% of government spending. One of the reasons London is the financial centre of the world is because it is part of the largest single market in the world. We would lose this if we left the EU.


5) Security: There is a lot of debate on whether the UK is safer inside or outside of the EU, and I am no expert on this. However, the two most recent former heads of MI5 and the most recent former head of MI6 probably are the experts on this. They all believe the UK is safer as part of the EU.

6) The Environment: The EU has been instrumental in improving the environment and without it, I don't consider there to be any hope in tackling climate change. Because of the EU, we have clean beaches, unleaded petrol, an ozone layer. Without the EU, nitrogen oxide emissions from road trasnport would be 10x higher. The EU is an example to the rest of the world on the environment and it would be a big loss if Britian left.

 7) Peace: David Cameron's claims that World War Three could break out if we left the EU were probably misguided... but there is no denying that the EU has brought nearly 60 years of stability to a continent that had been torn apart by war countless times in its history.



If we are going to solve any of the world's problems, we will need to collaborate on an international stage. If we can't even collaborate with our neighbours in Europe, how can we hope to reach agreements on things such as climate change, poverty and tax evasion with countries further afield such as China, India and Argentina?

The EU has shown that international collaboration can work over a sustained period of time (nearly 60 years). It is not perfect, but we won't make it any better by voting to leave. In fact, we would be part of a weakened UK, separated from a weakened EU.

What the EU needs is a strong vote to remain from the UK electorate, followed by votes for MEPs who want to engage in and improve the EU and not those who do not turn up at all, or go along to cause disruption. So if you haven't yet registered to vote, please do so here: REGISTER TO VOTE! You have until Tuesday to do so.

Contrary to popular belief, you do not need your National Insurance Number to register to vote, although it does make it easier. You can find your National Insurance Number on your payslip, student loan statements or by contacting HMRC: https://www.gov.uk/lost-national-insurance-number. If you still cannot find it, you can submit an application to register anyway, and the local council may request a photo of your passport to verify your identity.

If you have any questions, please comment below. Otherwise, on the 23rd June, vote to REMAIN a member of the European Union!






Monday, 30 May 2016

The EU Referendum: Part 2

Before I start, if you're reading this and you haven't read part one of this blog post, you can find it here: The EU Referendum: Part 1. I recommend you read part one first as this will then make a lot more sense!

I am going to pick up where I left off and talk about Vote Leave's "5 positive reasons to leave the EU". The two reasons I will discuss in this post are:

3. Build a fairer, safer immigration system
4. Free to trade with the whole world


However, I just wanted to dispel one myth surrounding "Take back control of our laws". The Vote Leave leaflet states "If we vote to remain... the European Courts will be in control of... big decisions like whether prisoners are allowed to vote". Admittedly, this is true. What Vote Leave do not tell you, however, is that if we vote to leave, the European Courts will still be in control of big decisions like whether prisoners are allowed to vote. The reason for this is that it was the European Court of Human Rights which said that we must allow prisoners to vote in the UK. This is because we are signed up to the European Convention on Human Rights, something which has nothing to do with the EU. I have discussed this in more detail in a previous blog post, which can be found here: Human Rights Act.

3. Build a fairer, safer immigration system

Interestingly, the Vote Leave campaign makes very few claims under this heading on their leaflet and it includes no specifics on how leaving the EU would make our immigration system fairer and safer. I suspect this is because most of the reasons they have implied - for the most part, and explicitly stated on occasion - over the course of the campaign have been based on no evidence, in spite of evidence to the contrary or are xenophobic. These claims include:

  1. Immigrants take our jobs
  2. Immigrants take our benefits
  3. Immigrants are criminals
  4. Turkey will soon be joining the EU
I'm sure many of you may have noticed that claims 1 and 2 seem to be contradictory, but nevertheless, I will try and assuage any worries you may have as a result of these.

Firstly, new research from the London School of Economics (LSE) has found that immigration does not keep down wages or lead to an increase in unemployment amongst indigenous citizens; immigrants don't even disproportionately take new jobs.

So if they're not taking our jobs, they must be claiming millions of pounds in benefits, right? Well, some EU migrants do claim benefits; I can't deny that. However, research by UCL in 2014 found that migrants from the EU had paid £20bn more into the government coffers in tax over the first decade of this millennium than they had taken out in benefits.

So they don't take our jobs and pay more than their fair share of tax, but do we want criminals coming to our country? No. Are immigrants any more likely to be criminals than native Brits? No.

Speaking broadly, foreigners are no more likely to be criminals than native Brits; 13% of the prison population in the UK are foreigners compared to 13% of the population as a whole. However, it seems to be specifically Eastern Europeans being targeted by UKIP. So, it seems important for you to know that a fairly recent study has found that the crime rate amongst Eastern European immigrants is also the same as that amongst native Brits.

Finally, the latest tactic of Vote Leave is talking up the "threat" of Turkey joining the EU and I understand the concern. However, this is not because of the extra immigration this might bring, but because I wouldn't want a country with such an awful human rights record in the EU. Fortunately, Turkey cannot join the EU unless all 28 Member States and the European Parliament approve. Given that Germany are officially opposed to Turkey joining, and so are the largest party in the European Parliament, I can't see this happening anytime soon. Furthermore, the European Commission (made up of the 28 heads of state or government) have said no more countries will join the EU for at least 5 years.

It appears that immigration is good for our economy, and obviously there are other factors invloved but it is the economy that a maority of voters have said is the most important issue in this decision, and it is the easiest thing on which we can measure the impact. Whether you think immigrants are improving or damaging British culture is a matter of opinion. Personally, I like other Europeans and am happy to have them living here. In fact, a recent survey found that 55% of people with an opinion on this matter say that British culture is enriched by immigration.

It is also really important that people appreciate that the freedom of movement works two ways! Just as EU migrants come to the UK, British citizens are free to travel, live and work in other EU countries. We don't need visas to go on holiday in the EU, we don't need visas to live in the EU and we don't need visas to work in the EU. The most recent figure I have seen estimates that 1.26m Brits live elsewhere in the EU. In fact, my girlfriend currently lives and works in Germany and it was as easy for her to do so as it would have been for her to live and work in Manchester and at least she can understand Germans!

4. Free to trade with the whole world

The Vote Leave campaign claims that we will be better off outside the EU because we will be able to negotiate our own free trade deals with other countries around the world such as China and India as opposed to having to negotiate free trade deals as part of the EU.

However, being part of a bigger market, such as the EU, gives us much more bargaining power when it comes to negotiating free trade deals. Professor Ngaire Woods from Oxford University can explain this much better than I can, so I strongly recommend this video: Ngaire Woods on Brexit and Free Trade.

Secondly, the most important market for UK exports is the EU. About half of British exports are to the EU and this is of little surprise. The EU is the biggest single market in the world, and it's right on our doorstep. Therefore, if we were to have free trade with just one other economy, the EU would be the logical choice. Many people take for granted not only the fact that we can import from and export to the EU with no tariffs or duties, but other barriers to trade are removed by our membership of the single market. Being a part of the single market means there is a level playing field between businesses from all 28 Member States, which increases competitiveness and lowers prices. Being part of the single market means that the same rules and regulations for goods and services apply in all 28 Member States, which increases efficiency and lowers prices. Why would we want to sacrifice this?

Yes, it is possible to be part of the single market without being part of the EU - this is the case for Norway. However, Norway's contribution to the EU per capita is about 80% that of the contribution the UK makes per capita, yet Norway has no power to change any of the rules and regulations it is forced to implement to be part of the single market (which is over 90% of the rules and regulations implemented by full members of the EU). Furthermore, to be part of the single market, Norway still has to accept free movement of people, so if this is your main concern, staying in the single market isn't the answer.

Maybe being part of the free trade area but not the single market is the solution, as is the case for Switzerland. However, like Norway, Switzerland also pays into the EU budget (about 40% of the UK contribution per capita) and accepts free movement of people. Likewise, similar to Norway, if Switzerland wants to export into the EU's single market, it must accept most of the rules and regulations, which it has no control over. Furthermore, although there is one main free trade agreement which was signed in 1972, Switzerland and the EU have signed over 100 bilateral agreements on such things as the freedom of movement of people. The Swiss parliament has 15 committees solely responsible for negotiating deals with the EU.

Free trade deals are not easy to negotiate and as we can see from Switzerland, it would be an ongoing saga. The Canada-EU deal has taken 7 years so far to negotiate and it has still not been ratified. I'm not suggesting a UK-EU deal would take this long; I'm sure there would be shortcuts due to our former status as a member of the single market, but do we want to spend years negotiating a free-trade deal when we already have access to the single market?

During this time, we would have to pay Customs Duty on anything imported from the EU. On the other hand, businesses in the EU would have to pay Customs Duty on imports from the UK meaning businesses in other EU countries would suddenly look a lot more appealing than UK businesses, damaging our economy and risking jobs. A study by LSE estimates that British households save £350 per year on shopping as a result of being a member of the single market. If you remember from my first blog post, the cost per household of being a member of the EU was £300 per year. This is therefore an estimated saving of £50 per household per year by being in the EU just on this one factor alone!


This is where I am going to leave this post. I have one more "positive reason to leave" to criticise, which is "5. Vote Leave is the safer choice" so I intend to quickly deal with this in my next post before talking about some hidden benefits of the EU which people may find easier to relate to.

Again, if you do want me to send you a link to any evidence I have quoted, please comment below.

If you haven't registered to vote, you can do so here: Register To Vote! If you're not sure if/where you're registered, you can update all your details in the same place. It's really easy and there's no excuse! Make sure you are registered and if you won't be able to vote on the day, register for a postal vote. It's easy and important that you do so!


Saturday, 28 May 2016

The EU Referendum: Part 1

I try not to be too political on Facebook but the EU referendum is too important to sit back and watch without trying to make a difference. In fact, the British public agree on how important it is. In a recent YouGov poll, 76% of respondents said that the result of the EU referendum was more important to them personally than the result of the next general election.

In case you couldn't guess from the fact that I am young and educated (the two biggest indicators of voting intention), I will be voting Remain and will do so without a second of hesitation. It is no secret that the key to Remain winning the referendum is a high turnout. This is because when there is a low turnout, it is young people who are the first to not bother voting and polling data shows that 43 is the age when a majority of people begin to support "Brexit".  It is because of this reason that UKIP's Arron Banks, the man bankrolling Leave.EU (an unofficial "out" campaign) has said he plans to "bore the electorate into submission" so that they don't vote.

Both Vote Leave (the official "out" campaign) and Leave.EU seem to be trying to confuse voters with nonsense arguments and deliberately misleading statements so I would like to dispel a few myths. To do this, I will take Vote Leave's "5 positive reasons to leave the EU" and point out, what I consider to be, massive holes in their arguments.

1. "Our money, our priorities"

Vote Leave claim that we send over £350m to the EU every week. The figure they are referring to is our "gross contribution to the EU", which is actually £361m a week.

However, before this is paid to the EU, we get a rebate. This rebate was negotiated under Thatcher because the calculation to work out each country's gross contribution worked out poorly for the UK - this wasn't by design; the calculation was invented before the UK joined. I won't go into the mechanics of the calculation but as a result of the rebate, the UK actually only pays £276m a week (less than 80% of the claimed figure).

Let's not stop there though. Out of the money we give to the EU, about 40% comes straight back to the UK to fund (amongst other things) agriculture, regional development and universities. This leaves the actual cost of our EU membership at £161m a week. This works out at about £300 per year per household. This might still sound like a lot of money (albeit a lot less than the £700 per yer per household figure claimed by Vote Leave) but, as with any membership, we get a whole host of benefits from being a member, some of which I will talk about later on (or more likely in a future post).

2. "Take back control of our laws"

This "positive reason" is quite self-explanatory; Vote Leave claim that by leaving the EU, we can take back control of our laws. There are so many things wrong with this argument that I don't know where to begin.

Firstly, UKIP has claimed that 75% of UK laws were made in Brussels. This is just factually inaccurate. I'll admit, no-one knows the exact figure and the amount depends greatly on what you consider to be laws and what you consider to have been "made in Brussels". However, if we are being as generous to UKIP as possible, the upper end of actual estimates carried out by the House of Commons library is 50%. In reality, the figure could be as low as 15%. If we meet in the middle, that's about one third of UK laws that have been made in Brussels.

Again, though, there is a fundamental flaw in this argument. Contrary to claims by Boris Johnson, these are not laws such as "we can't recycle teabags" or "children under 8 can't blow up balloons" or "we can't sell bananas in bunches of more than three", all of which have been thought up by Boris and have no element of truth. Many of the laws are there to improve safety, save the environment and improve competitiveness in the single market.

Finally, these laws, for the most part, have not been imposed on us by unelected bureaucrats in Brussels. The laws, I accept, will have been proposed by the European Commission - a body made up of "unelected bureaucrats" in the eyes of Vote Leave, or professionals who assess the economic, social and environmental impact of different policies in the eyes of Stronger In. By the way, this is no different to UK laws being proposed by the Civil Service.

The laws are then amended by the European Parliament, an elected body, the members of which every EU citizen (of voting age) can vote for. The laws may also be amended by the European Council, the 28 elected heads of state or government for each Member State. Both the Parliament and the Council have to agree on new EU laws.

If a qualified majority (at least 55% of Member States representing at least 65% of the EU population) votes to implement a law, then all Member States must accept it. This means that laws can occasionally be imposed on a Member State against their will. So how many EU laws has the UK voted against? Just 13%. That's right, of the however many laws Vote Leave claim the EU has "imposed" on us, elected British representatives have voted in favour of 87% of them.



At this point, I am going to stop typing. I feel like you have probably read enough for one day and I have probably written enough for one day. I hope that you feel like you better understand some of the facts and figures being bandied about in this ridiculous referendum campaign. I will be back to talk about Vote Leave's other three "positive reasons":

3. Build a fairer, safer immigration system
4. Free to trade with the whole world
5. Vote Leave is the safer choice

I will also try and give some examples of things the EU has done for us, which you might take for granted! In the meantime, I appreciate I haven't quoted any sources in my article. I figured it would get too messy if I inserted a load of links to other articles that no-one has time to read. If you do want me to send you a link to any evidence I have quoted, please comment below.

I also recommend the following book: Europe: In or Out. It's written by a self-confessed eurosceptic trying to give just the facts.

If you haven't registered to vote, you can do so here: Register To Vote! If you're not sure if/where you're registered, you can update all your details in the same place. It's really easy and there's no excuse!


I really am going now. Thank you for letting me keep you In The Loop.

Ed

Saturday, 30 May 2015

Do Companies Pay Their Tax? (A Brief Look At Amazon)

Yes. They do. If they didn’t, this would be tax evasion. Tax evasion is illegal and firms face penalties for evading tax. So why is there such a big fuss about companies such as Amazon, Google and Starbucks not paying their fair share?

There are two issues here. The first is that too many people do not understand how business taxes work in the UK and are misled by left-wing media. Linked to this is that too many people do not understand the difference between illegal tax evasion as mentioned above, and legal tax avoidance which is common sense.

 The second is that this question sometimes get mixed up with: do companies pay their fair share of tax? This is a question that I’m not going to go into as it is primarily concerned with political philosophy – my aim is not to tell people how to think but give them the knowledge to think accurately.

Therefore this blog post is hopefully going to tackle some misconceptions. I’m going to mainly stick to Amazon’s tax affairs as this is the company which I know most about. Last year, the Guardian stated that “Shoppers have been urged to boycott Amazon's British business after it paid just £4.2m in tax last year, despite selling goods worth £4.3bn.” There are two main things wrong with this statement.

The first is that corporation tax is not paid on revenues and as such, the statement makes no logical sense. Corporation tax is a tax levied on profits at a rate of c. 21% (this can change slightly depending on the size of the company). However, companies can make deductions from their trading profits if they make charitable donations, or invest in capital.

The second fault with the statement is that the goods worth £4.3bn mentioned were not sold by Amazon UK but by Amazon EU Sarl. This is the company based in Luxembourg from which we buy goods from when we place an order through Amazon’s website. Amazon UK is merely a distribution company which Amazon EU Sarl pays to distribute the goods.

Amazon UK made £17m of profit in 2013, and paid £4.2m of that in corporation tax to HMRC. This is a rate of over 24%, meaning the company paid all the tax due in the UK. Maybe you object to the fact that Amazon is based in Luxembourg, and if you do, you can blame Jean-Claude Juncker, the former president of Luxembourg and current president of the European Commission. He offered Amazon a special rate of corporation tax (3.5%) if they set up their headquarters there as he knew that the Luxembourg government would reap the benefits (support for the argument that lowering the corporation tax rate brings in more business and therefore more money to the government).
You could blame Amazon for setting up in Luxembourg and “avoiding” tax but be honest, if you had the choice of paying 3.5% income tax or 20% income tax and both options were completely legal, which would you choose? It’s interesting that we don’t describe individuals who put money into their pensions or take part in cycle to work schemes, so that they have less taxable income, as “tax avoiders”.

It is also worth noting that Amazon is not a profitable company in general. Even if they had no “tricks” to avoid tax, they would not pay much corporation tax. On global revenues of $89bn in 2014, Amazon.com made a loss of $241m. This is because Amazon offer so many of their goods and services at a loss. Their Kindle tablets and Fire phones are both sold at a loss, and Amazon loses millions of pounds on delivery every year. Now, I’m not going to pretend that this is for the benefit of consumers – it is purely to gain market share in as many markets as possible. However, a side effect of this is that we, as consumers, get a great deal. As Milton Friedman once said, “The social responsibility of business is to increase its profits” – and the best way to increase profits is to look after both your customers, and your employees.

So boycott Amazon if you must, if you feel that they are “cheating the system”, but please be aware that the only person who will suffer as a result is yourself. I hope that you are now in the loop on corporation tax but if you’d like me to explain anything else on this topic, please leave a comment below!

Ed


Note: Since planning this blog, Amazon announced they would be changing how they report their sales and items distributed in the UK would be reported as sales for Amazon UK. This should lead to Amazon paying more corporation tax in the UK but this is not guaranteed as, again, corporation tax depends on profits and not revenue! This is a voluntary move by Amazon, but it has possibly been hastened by the investigation currently ongoing by the EU into Luxembourg’s relationship with Amazon. It should be noted, however, that it is Luxembourg’s offer of reduced corporation tax that is potentially illegal. It is not Amazon’s business structure that is being investigated. There are also investigations at present into Ireland’s relationship with Apple, and the Netherlands’ relationship with Starbucks.

Thursday, 21 May 2015

Electoral Reform: Voting System

15.4 million. The number of people who went out to voted two weeks ago today only for their vote to be completely worthless. One in three people eligible to vote didn't vote at all. How many of these did not vote because they knew it was pointless? It is shocking that in the UK, a country with one of the oldest parliaments in the world, 76% of people did not vote for the party that currently holds all the power.

 

Some people have blamed those who did not vote, or those who didn't vote Labour out of fear of the SNP. In reality, there is only thing that can be blamed for this, our broken voting system, First Past The Post (FPTP).This is a system designed for two party politics, something which we do not have in the UK. Six parties received over one million votes, and I have no doubt that the smaller of these might have garnered more votes had people believed their vote would have meant something.

 

The most proportional voting system is the D'Hondt method of Proportional Representation or Party List PR, usually just referred to as PR. However, I would advocate a slightly different version of Proportional Representation known as the Single Transferable Vote. Below I have included a table showing the estimated number of seats that would have been won under each voting system. It is important to note that these are estimates as it is impossible to know how people's votes might change under a different voting system, and the results would depend on how the new voting regions were drawn up.

 

Party

Vote Share

FPTP

PR (D’Hondt)

STV

Conservative

36.9%

331 (50.9%)

242 (37.2%)

280 (43.0%)

Labour

30.4%

232 (35.7%)

199 (30.6%)

241 (37.1%)

UKIP

12.6%

1 (0.2%)

83 (12.8%)

38 (5.8%)

Lib Dems

7.9%

8 (1.2%)

51 (7.8%)

29 (4.5%)

SNP

4.7%

56 (8.6%)

31 (4.7%)

37 (5.7%)

Green

3.8%

1 (0.2%)

24 (3.7%)

2 (0.4%)

 

Party List PR: parties present lists of candidates and seats are awarded according to their party’s share of the vote. This is usually done using an electoral formula or a quota which prevents too many small parties from winning seats.

 

You may wonder why I am not advocating the most proportional system available. There are a few reasons, the main one being that it gives parties even more power over who is elected. They can choose the order of the candidates on the list and independents are not able to stand. Also, people will no longer have constituency MPs as regions will be much larger as they are for the EU elections to enable the results to be as proportional as possible. Finally, one of the main arguments to keep FPTP is that it delivers majority governments. PR almost destroys any hope of a single-party majority (which is not a bad thing in my book but one party does need to be big enough to give it the impetus to form some sort of coalition).

 

Single Transferable Vote (STV) solves many of these problems, at least partially. I have borrowed the Electoral Reform Society’s explanation of STV as I don’t feel I could explain it as well as the experts:

 

“The Single Transferable Vote (STV) is a form of proportional representation which uses preferential voting in multi-member constituencies.

 

Candidates don't need a majority of votes to be elected, just a known 'quota', or share of the votes, determined by the size of the electorate and the number of positions to be filled.

 

Each voter gets one vote, which can transfer from their first-preference to their second-preference, so if your preferred candidate has no chance of being elected or has enough votes already, your vote is transferred to another candidate in accordance with your instructions. STV thus ensures that very few votes are wasted, unlike other systems, especially First Past the Post, where only a small number of votes actually contribute to the result.”

 

By using STV, some power is taken back from the parties as the public can rank their preferred candidates, not all from the same party. A friend of mine had a dilemma in the recent election where the party he wanted to vote for had put up an abhorrent candidate in his constituency. This would not be an issue under STV.

 

Although people would still not technically have a constituency MP, STV tends to work best when constituencies elect 3 or 4 candidates so the constituencies would not be quite as large as they would likely be under PR. This would also allow constituents to contact the MP they feel is most closely aligned to their viewpoint when they feel they need to contact one of their representatives.

 

As you can see from my table above, STV also is more likely to deliver slightly more seats to the biggest parties so that a coalition is able to form. There is another benefit to this as well. People argue that PR is not the best voting system as it gives too many seats to extremist parties e.g. UKIP. STV allows people to rank their preferences, which means that parties like UKIP who are unlikely to be anyone’s second choice party would be less likely to gain seats.

 

The result is that STV is much more likely to deliver a parliament that people voted for, and that people are happy with.

 

Thanks for reading, and please comment below if you disagree or you need something about STV explaining. I have not gone into depth about how the votes are counted because this can get quite complicated. However, the voting process itself is straightforward!

 

Most importantly, thanks for letting me keep you In The Loop. If you feel like the voting system does need to change, then don’t forget to sign one of the following petitions:

 

http://action.makeseatsmatchvotes.org/ea-action/action?ea.client.id=1754&ea.campaign.id=38262&ea.tracking.id=msmv

https://www.change.org/p/david-cameron-reform-our-voting-system-to-make-it-fair-and-representative-makeseatsmatchvotes

 

Ed

 

 

 

 


Saturday, 16 May 2015

Privatisation of the NHS

So there are a couple of internet memes doing the rounds which made my mind up about what topic to blog about next, including this one:


When I saw this meme, I finally clicked as to why so many people are so unwilling to even have a sensible debate about the NHS. They think that privatisation of the NHS means that we will have to pay for healthcare. This is completely untrue. Privatisation means that the government pays private companies to provide certain services, It does not mean that we will move to a private healthcare system where everyone has to either pay for treatment up-front, or pay for health insurance as they do in the US.

So what's the point of privatisation? The best way to explain this is to imagine the government as a "jack of all trades, master of none". Essentially, although the government can do a good job of proving healthcare, education, transport, it is by no means an expert in the provision of any one of those sectors. However, private companies have to be experts in their field to make a profit, and this can lead to massive efficiency savings. 

To illustrate this, and these numbers are completely fictional, imagine the government spends £100bn on healthcare per annum (in fact, the NHS budget for 2013/14 was £95.6bn). Now imagine private companies come along and offer to run these services (to the same standard) for £80bn per annum. The government saves £20bn each year which it can then spend on other services (or more likely, pay off some debt). Brilliant, everyone's happy, or are they?

The criticism of privatisation is that out of the £80bn being paid over to the private companies, those companies are keeping £5bn of that as profit. Many people (usually to the left of the political spectrum) believe that private companies should not be allowed to profit out of providing healthcare, a necessity for people to live happy and healthy lives.  I am not going to argue that people are wrong to hold this belief but I have come up with a hypothetical scenario to enable you to judge whether you are against privatisation in principal. So, would you rather:

1) have a healthcare system which is good but not great (let's say 7/10); or
2) have a healthcare system which is great (let's say 8/10) but a few people make lots and lots of money out of it (note: there is no cost to you; in fact you have access to a slightly better healthcare system.)

I am not trying to tell you which is the right answer here, I just want you to be well informed about the issue.

Personally, I believe that privatisation should occur up to the point that it stops becoming beneficial for the NHS. My answer in the above scenario would therefore be Option 2. However, I do not believe that it should be privatised for the sake of it - there are some services which private companies will not be able to provide more efficiently than the government.

I would also add that people who don't trust the Conservatives with the NHS because they want to completely privatise it should bear the following in mind: it was Labour who first started privatising the NHS and in the grand scheme of things, privatisation had, at most, increased at the same rate under the Coalition as it had under the previous Labour government. For your reference, at present, the NHS is roughly 6% privatised.

Interestingly, Singapore has what is generally considered to be one of the best healthcare systems in the world and definitely the most efficient. Singapore's healthcare system is two-thirds privatised (unfortunately, Singapore's healthcare system is too complicated to discuss now but if people want me to, I will write a blog post about it.) Another strong performer is Valencia's healthcare system, where 20% of services are provided by private companies at absolutely no cost to performance.

I therefore suggest that anyone who is against privatisation, despite never having considered what it actually means, has a good think about what they want from their healthcare system. I, for one, would like a healthcare system that works and that we, as a country, can afford.

Thanks for reading and allowing me to keep you.. In The Loop.

Ed