Suporting a Leave vote would be the right move for the party's working-class supporters, says John Longworth.
BY JOHN LONGWORTH
My fateful Eurosceptic speech at the British Chambers of Commerce conference on the 3 March ultimately led to my resignation as Director-General. This is the only way I could speak freely on the EU referendum. As I left the stage at our national conference, the next speaker was waiting in the wings and he very kindly shook my hand and said how much he agreed with me.
That person was Jeremy Corbyn.
The EU and open-border EU immigration has been a disaster for working people in the UK. Working people have been abandoned by the Labour Party, sacrificed on the altar of the EU project and at the hands of an Islington intelligentsia. Voters are abandoning them in droves for Ukip, or simply staying at home out of despair.
I come from a northern former mill town and many of my firiends are life-long Labour voters. Almost all of them think Labour has “lost the plot” – their words, not mine – and that the party is now completely out of touch on the issue of Brexit.
An unlimited supply of cheap labour from the EU has led to an increasingly low-wage, low-skill, low-productivity economy, exactly what we don't want for our economy and very bad for working people. At this point in the economic cycle, wages should be rising naturally, but they’re not. This slump in wage growth has partly led to the increase in the national minimum wage, a perverse one-size-fits-all policy which has destroyed jobs in many sectors that cannot afford it.
Cheap labour also discourages businesses – particularly multinationals – from training young people, resulting in nearly half a million unemployed under 25-year-olds. It also means that there is less incentive to invest. Large corporates are now sitting on piles of cash, while productivity falls, wages fall, and more families get trapped poverty.
While all this is going on, we have a damaging skills shortages. Yet, many businesses in this country cannot recruit the people they need from outside of the EU because of our backward immigration system.
Migration has also put huge strains our public services. Hospitals are overrun, school places are lacking, and roads are congested. Migration is good for the revenues of the largely foreign-owned multinational corporations, but very bad for normal working people.
As if this were not bad enough, many people of the left seem content to let some of our most important industries, like our venerable steel industry, crumble. Next it will be other foundation industries like basic chemicals, timber products, metals, and high-energy-use industries such as ceramics.
All these industries are being strangled by an EU regulatory straight jacket. We are facing competition from inside and outside the EU. We cannot erect tariffs to prevent dumping. If this were to happen in the UK, it would be illegal. We cannot match the subsidies provided by Germany and other member states through their state-backed business banks who provide long-term, low-cost loans, free of state-aid rules. We are prevented by the EU from doing the same.
We also cannot use public procurement for fear of EU infringement proceedings, so we are not allowed to build the northern powerhouse or HS2, or Crossrail using British-produced products. We are not allowed by the EU to care for our own people and the left are happy to see this state of affairs.
What’s Labour’s current answer? Migration increases GDP. Yes, that might be true but the impact is only marginally and short-term. That is what a House of Lords review showed last year, which was cited by none other than Theresa May. More importantly yet, migration is also a drag on GDP per capita, meaning it makes us poorer as individuals than we should be, and it is regular families who suffer the most.
Many trade unions have already jumped to the EU’s defence. But the public-sector-orientated Trade Union leaders are just as vested in the EU project. Their membership is packed with migrants. Plus, with featherbedded public-sector pensions, they’re very satisfied with the status quo.
Labour's only fig leaf is their argument that if we were not in the EU, evil British governments would allow employers to abuse employees. As someone who was a Health and Safety Commissioner for many years I can vouch for the rigour of our homegrown rules to protect workers, just as I can attest to some of the costly bureaucratic absurdities that come out of Brussels and, in the case of safety rules, Luxembourg.
The Labour Party should be for Brexit and should be ashamed of its abandonment of working people.
John Longworth was director-general of the British Chambers of Commerce and is a supporter of Vote Leave.