The countdown begins: are we best in or out of the EU?

The UK faces 17 weeks and three days of campaigns and deliberations leading up to an EU referendum on 23 June. How will industry vote in the great in/out debate? ACE's chief executive Nelson Ogunshakin surveys the field

And so it begins. 

On Friday night the Prime Minster emerged blinking into the flashing lights of the world media to announce that a deal had been done, that he had achieved his goals and that this was a new day in Britain’s relations with the EU. This was followed by the first Saturday cabinet meeting since the Falklands War at which the Cabinet backed the deal and agreed for a referendum to be held on the 23 June.  

As promised, this also allowed ministers to state if they would be campaigning to remain in or to leave and the press lost no time in tracking down Michael Gove and Boris Johnson for their positions. Both have decided to fight for the leave campaign making them the most prominent politicians on that side alongside other cabinet ministers such as Ian Duncan Smith and Chris Grayling.

"Our industry was as split as the country is with roughly one third of ACE members for, a third against and another third waiting to see what the Prime Minister’s deal would be." 

After all these years of talking about EU reform, Brexit and the rise of UKIP, we have finally arrived at the point at which all of these commentaries will be put to the test in the massive public opinion exercise of a referendum. This once strange political device, more often used across the continent then here in the UK, has now become a familiar part of our political season with previous referendums on the voting system and the Union under our belts.

ACE has been engaging with its members over the last year to determine how the industry will respond to the eventual referendum when it is called. It may come as no surprise to find that our industry was as split as the country is with roughly one third of ACE members for, a third against and another third waiting to see what the Prime Minister’s deal would be. 

So what are the changes that Cameron has got from the EU?

Child benefit - Child benefit payments to migrant workers for children living overseas to be recalculated to reflect the cost of living in their home countries;

Migrant welfare payments - The UK can decide to limit in-work benefits for EU migrants during their first four years in the UK. This so-called "emergency brake" can be applied in the event of "exceptional" levels of migration, but must be released within seven years - without exception;

Eurozone - Britain can keep the pound while being in Europe, and its business trade with the bloc, without fear of discrimination. Any British money spent on bailing out eurozone nations will be reimbursed;

Protection for the City of London - Safeguards for Britain's large financial services industry to prevent eurozone regulations being imposed on it;

Sovereignty - There is an explicit commitment that the UK will not be part of an "ever closer union" with other EU member states. This will be incorporated in an EU treaty change;

'Red card' for national parliaments - It will be easier for governments to band together to block unwanted legislation. If 55% of national EU parliaments object to a piece of EU legislation it may be rethought;

Competitiveness - The settlement calls on all EU institutions and member states to "make all efforts to fully implement and strengthen the internal market" and to take "concrete steps towards better regulation", including by cutting red tape;

Limits on free movement - Denying automatic free movement rights to nationals of a country outside the EU who marry an EU national, as part of measures to tackle "sham" marriages. There are also new powers to exclude people believed to be a security risk - even if they have no previous convictions.

Although the bulk of these changes reflect the current domestic concerns of the UK electorate there are a couple that will be of interest to our industry. 

The first is that the UK will retain the Pound as an internal currency with the acceptance by the EU that the zone will now always be a multi-currency union. This is also followed by an agreement that neither the City of London nor the Euro zone will be able to seek a competitive advantage over the other ensuring that there is no detriment to firms that trade in either. 

Secondly, the provision calling for greater steps to be taking to ensure that the internal market is more effective, particularly in the services sector. This could help member firms operate more effectively in the EU without unfair trade barriers preventing UK firms wining work in other EU countries. 

Finally, the issue of whether the UK will be part of a larger European state has been put to rest with an agreement that the EU will operate a two system structure with some integrating more and others remaining in an essentially economic relationship.

Is any of this enough for our members? we shall have to wait and see. 

As luck would have it the first test will be on Tuesday as ACE’s board assembles for the first meeting of the year, which will provide the first substantive feedback on how the industry is taking the news. This will then be followed by the Large Consultancy Group dinner where we will be debating the merits of the UK’s continuing membership.

ACE will also be consulting widely with its members to determine their views on how we should proceed with the forthcoming campaign. I look forward to traveling the country and meeting with our members to hear their views on this vital subject for our country and reporting back what our industry thinks.   





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