Hereford Times Column: Referendums vs. General Elections

People sometimes forget that referendums are very different from general elections.

In referendums there are no MPs, no political parties and no Prime Ministers (indirectly) to vote for.  Their impact runs, not for five years, but for at least a generation.  A bad decision cannot be improved only a few years later by voting the other way.

There are no manifestoes, and just one question to be answered.  In this case:  In or Out?  The impact of this decision may be starkly different for different people:  for the small business owner vs. the big corporate executive, for the housewife vs. the pensioner, for the student vs. the civil servant.

Everyone has their own opinions, and rightly so.  There are huge questions of economic growth and national identity at stake.

But for referendums especially, given their strategic significance and long-term effect, there is an overwhelming need for sources of unbiased information and impartial advice, which allow people to make a fully informed decision.  That is what I am aiming to offer my constituents in the weeks before the vote on June 23rd.

In that spirit, let’s look at an apparently simple question.  It’s widely thought that EU membership imposes lots of indirect costs on the UK, e.g. through regulation.  But how much does it directly cost the UK to be in the EU?

The headline number is that the UK pays £17.8 billion a year, or £350 million a week.  But this is a notional gross number, and to be fair you have to net off the amount that gets paid back.

First, you need to deduct the UK rebate famously won by Mrs Thatcher in the 1980s.  That leaves us paying £12.9 billion.

But this does not include the £4.4 billion which the EU sends back in farming and regional aid, or £1.4 billion of research grants, or £800-odd million in other payments.  That’s £6.6 billion.

It’s fair to assume the UK would need to maintain these or similar levels of support for farmers, regional aid, research etc. even in the event of Brexit.

In other words, leaving the EU would save the UK some £6.3 billion a year.  That feels like a lot of money overall, but how much is it in relative terms?

The answer is:  eight-tenths of 1% of UK public spending, roughly equivalent to £2 per person per week.  Is that too much, or a price worth paying?  It’s up to every voter to decide.