Worcester’s MP has warned of his real concerns for the local economy in the event of a Leave vote on 23rd June and confessed that his concern about local jobs was one of the crucial factors in determining his support for the UK remaining in the EU.
Robin Walker, who rebelled to secure the referendum in 2011 as he feels strongly that the British people including his constituents in Worcester should have a say, has warned that it is vital that people think carefully about the consequences both long and short term. He has cited the overwhelming weight of evidence from businesses and economists that leaving the EU would be a risk to investment in the UK, saying:
“One of the key reasons I will be campaigning to Remain is that I could not in good conscience take a position in this debate which I felt might lead to constituents losing jobs. As a private citizen there were times when I might have been tempted to back the Leave campaign as I feel strongly that the EU needs changing and that Britain should have a louder voice within it, but my experience as an MP for a city where unemployment has halved leads me to believe it is just too important to keep people in work.”
“I could not face the task of telling people whose personal financial circumstances were damaged by coming out of the EU that it would be all alright because things might get better in the future and I am not even sure that would be the case. Those supporting the Leave campaign will call this Project Fear but for me it is really a case of Project Reality. I have come to the conclusion that we are better off staying in and pressing for change. At a time of strong economic growth in Worcester, beating the weaker national trend, we should be doing everything we can to boost investment.”
Business organisations and a wide range of businesses have already spoken out about the risks to investment and job growth if the UK were to leave the Common Market of 500 million people which is comprised in the EU and Leave campaigners have been unable to articulate a clear vision of how the UK would go about rebuilding its trade links. The CBI has warned:
“Leaving the EU will be a step into the unknown for the UK and cause a significant economic shock. Economic modelling of “Brexit” scenarios, undertaken for the CBI by PwC, shows how even optimistic scenarios for leaving the EU will cause uncertainty and leave the UK economy permanently smaller than it would have been.”
Today Microsoft and Hewlett Packard have added their voices to the chorus of tech businesses that want Britain to stay in the EU as a poll of tech firms showed that 70% support continued membership of the group. Moves to create a free market in digital services offer huge opportunities to UK based tech firms including the many cyber security and software companies based in Worcester.
The TUC has published its own website about the EU debate, concluding that “The TUC is concerned that leaving the EU puts at risk many vital workplace rights currently underpinned by EU law – paid holidays, extra maternity rights and better conditions for part-time workers, as well as many better jobs in export-reliant industries.”
Recently published research from Warwick Business School & Aston has also confirmed that Brexit could hold back Foreign Direct Investment in UK businesses. According to UK Trade & Investment (UKTI) the UK was the number one destination for FDI in Europe in 2015, with estimates from the OECD showing it increased by 50 per cent when the global value fell by 11 per cent.
But if the UK votes to leave the EU on June 23 this position would be lost according to research by Professor Nigel Driffield, of Warwick Business School, and Michail Karoglou, of Aston Business School. Professor Driffield said: “Those championing Brexit often comment on how trade would be unaffected, so long as we were to stay within some looser trading arrangement with the EU, but most seem to assume that inward investment would remain unchanged. Our research has found that is not the case, it would greatly reduce the level of FDI to the UK and for those people who think there might be just a short-term ‘blip’ we have found it will take four years to recover and even then the long-term trajectory will be lower. EU membership has made inward investment more stable and has increased the long-term trend for the UK, so leaving would make the country less attractive for non-EU investors.” According to the Office for National Statistics turnover by foreign-owned businesses in the UK is more than £12.5 billion.
The British Chambers of Commerce surveys show a majority of their members supporting staying in (52% vs just 37% supporting Leave) and the local Herefordshire and Worcestershire Chamber has seen even stronger support with 65% of respondent to their survey at April’s Business Expo supporting Remain compared to just 24% for Leave and 11% undecided.
The Federation of Small Business has also stated that a majority of its members favour staying in although the public surveys show that the membership is more divided and the organisation itself is taking a neutral position. They have launched a series of podcasts to ensure people are properly informed about the impact of any decision on businesses and are giving airtime to both sides of the argument.
In his article explaining why he would be supporting the Remain campaign Robin set out his concerns that local firms such as Worcester Bosch and Yamazaki Mazak might find it harder to attract future investment from boards overseas if Britain were to leave the EU. He has been clear that he does not believe that any company would close or that millions of jobs would be at risk immediately, but is concerned rather by the risk of investment being lower during a period of uncertainty caused by Brexit and the risk of long term damage to the UK’s and Worcester’s position in attracting inward investment. He argued that this extends beyond European companies and also includes companies from elsewhere in the world such as inward investors from Asia.
This view has today been confirmed by Marcus Burton, European Group Managing Director of Japanese machine tools company, Yamazaki Mazak who has said:
“The position of Mazak on this subject is that “it is in the best interests of Yamazaki Mazak for the UK to remain in the EU”. Yamazaki Mazak is a significant inward investor into the UK and is the European Headquarters for one of the world’s leading manufacturers of machine tools. The European production site is based in Worcester employing more than 500 people. Since opening in 1987 we have manufactured more than 25,000 machine tools in our Worcester facility with over 85% being exported to Europe. The company does not wish to see any changes in our access to the Single European Market and therefore supports the “Remain” campaign. Remaining in the EU is important for our future strategy.”
Robert Bosch GMBH, the parent company of Worcester Bosch were among the leading German companies to back a call for the UK to stay in the EU last year and are among the 2,500 companies based in that country alone who employ more than half a million people in the UK.
A statement from Worcester Bosch said:
“Bosch believes that the European Union – despite some shortcomings – continues to be a key driver of prosperity for Member States, and would be pleased if the United Kingdom chose to continue its membership. However, Bosch ultimately believes that it is for the British people to decide whether to exit or remain part of the EU”
Internationally organisations from the OECD to the IMF have commented on the added risk that the UK economy would face if the country left the EU with IMF President Christine Lagarde saying “It would hurt both the EU and the UK if the UK was to go.” And “”Depending on what hypotheticals you take, it’s going to be pretty bad to very, very bad.”
Closer to home the Governor of the Bank of England, Mark Carney has said:
“[Leaving Europe is] the biggest domestic risk to financial stability” and “It is possible that a vote to leave could result in a potentially extended period of greater uncertainty about the economic outlook, including about the prospects for UK export growth… Greater uncertainty could lead firms to postpone some investment projects and households to defer some spending.”
Stuart Laverick, Principal of Heart of Worcestershire College said:
“Whilst we don’t like everything about the EU and the way it works, it is better to stay in and press for change than to take the unknown risks of coming out. For skills and investment in jobs the EU provides valuable certainty and there is too great a risk in coming out for the future of our young people. At Heart of Worcestershire College we want what is best for the people we serve and from all the evidence I have seen I am convinced it is better to stay in and press for further reform than to come out.”
Commenting on all these statements Robin has said:
“When the CBI, the TUC, the Chambers of Commerce, the Bank of England, the IMF, major local businesses and local Colleges are all making the same argument it is important to listen. I know that there will be some who reject all this evidence and all these arguments but I would just ask them to think whether it is responsible to do so.”
“I have taken the view that for all my concerns about the way the EU works it is better to remain in it and take advantage of the many opportunities it brings for inward investment than to take the unquantified risks of coming out. I don’t believe our country would fail if we came out and I profoundly believe in the ability of both Worcester and the UK to succeed whatever the outcome on June 23rd but I think success will come more easily, with less pain in both the short term and the long term if we decide to stay in.”
“With local job figures close to record lows and still falling I want to see more jobs, more investment and more apprenticeships in Worcester and I think a Remain vote would help to achieve this. The relief rally from inward investors could be just what we need to take things forward both locally and nationally.”
Notes to Editors:
For the position of the CBI see:
For the PWC Research see: Economic modelling of “Brexit” scenarios
For the statement from Microsoft & Hewlett Packard see:
For the British Chamber of Commerce position on the Referendum see:
For the Herefordshire & Worcestershire Survey of Businesses see:
For the FSB podcasts & position on the EU see:
For the TUC position on the European Referendum see:
For more information on Yamazaki Mazak see:
For more information on Worcester Bosch see:
For the position of major German investors in the UK including Bosch see:
For more information on Heart of Worcestershire College see: