In The Press

Letter in the Financial Times - Britain needs to lead in a strong, reformed EU

9 January 2013

From Mr Roland Rudd, Sir Richard Branson and others.

Sir, We welcome David Cameron’s decision to focus on the EU’s importance to Britain in his planned speech later this month.

The EU remains home to half our exports and is the most powerful trading bloc in the world. Other EU member states are the main source and destination of foreign direct investment into and from the UK, accounting for about half of our investment.

The prime minister is to be congratulated for setting his sights on an ambitious EU-US trade deal. Benefits to EU members are estimated at around £53bn. The US is keen to see a strong UK in a strong Europe, fearing a weaker Britain on the sidelines of a more protectionist EU.

Mr Cameron is right to dismiss the idea of the UK emulating Norway or Switzerland. On average, Norwegians each pay €70 a year for the luxury of having to implement EU single market rules over which they have no say as they have no representation in the European Commission, Council, Court or Parliament. In 2011, Norway paid 79 per cent per person of what the UK paid.

Switzerland has an even worse deal as it has no agreement with the EU on services. This is despite spending more than 10 years negotiating 120 separate agreements with the EU. Of the UK’s annual tax revenues, £25bn is estimated to be vulnerable because it comes from mobile activity easily moved out of the UK. Spending 10 years trying to negotiate similar deals for the UK might eventually save some of our industries for goods but would seriously damage our world-leading exports of financial, legal and accounting services.

We urgently need more EU reform, not least of the working time directive and the antiquated EU budget, and completion of the single market in services such as digital, telecoms and energy. Britain should be forthright in seeking the lead to achieve these changes. But equally, we must be very careful not to call for a wholesale renegotiation of our EU membership, which would almost certainly be rejected.

To call for such a move in these circumstances would be to put our membership of the EU at risk and create damaging uncertainty for British business, which are the last things the prime minister would want to do. We need a strong reformed EU with Britain at the heart of it.

Roland Rudd, Chairman, Business for New Europe

Sir Richard Branson, Founder, Virgin Group

Sir Roger Carr, President, CBI

Lord Davies of Abersoch, Chairman, Corsair Capital

Chris Gibson-Smith, Chairman, London Stock Exchange

Gerry Grimstone, Chairman, TheCityUK

Jan du Plessis, Chairman, Rio Tinto

Sir Michael Rake, Chairman, BT

Sir Martin Sorrell, Chief Executive, WPP

Malcolm Sweeting, Senior Partner, Clifford Chance

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