Tory manifesto on Brexit: a mandate for “no deal”
The Tory manifesto offers nothing new on their Brexit plans and makes immigration pledges that constitute another barrier to trade and investment.
If you were hoping to find something beyond rhetoric on Theresa May’s Brexit plans with the launch of the Tory manifesto, you’d be disappointed. But probably not at all surprised.
The manifesto recommitted to leaving the single market as well as the customs union. Instead of membership of both of these, the Tories would seek “a comprehensive free trade and customs agreement”. Of course, they didn’t say how they planned to achieve this without accepting freedom of movement or the jurisdiction of the European Court of Justice. There is nothing new here from her Lancaster House speech or the white paper.
… we continue to believe that no deal is better than a bad deal for the UK.
Conservative Party 2017 manifesto
The Tories also maintain that “no deal is better than a bad deal”. This is despite Theresa May’s government failing to do an economic impact assessment of it. And unlike Labour and the Lib Dems, the Tories have provided no costings for their manifesto. The statement also ignores the fact that “no deal” means continued insecurity for the four million plus EU citizens living in the UK and Brits living in the EU.
Amusingly, in a section on Wales, the Tories enthusiastically say the country will “benefit even more from the UK single market”. I’m not sure how much comfort that is for a country whose exports to the EU single market last year accounted for 66.9% of Welsh exports. Unless there is tariff and non-tariff barrier free trade with the EU, Wales will be one of the bigger losers from Brexit.
And not only does their manifesto threaten trade barriers with the UK’s biggest trading partner, its pledges to reduce immigration to the “tens of thousands” will also create trade barriers to getting agreements with other countries. Boris Johnson will not be able to rely on a trade deal with India to boost whisky sales if Britain maintains or tightens immigration restrictions with them.
Immigration pledges are another barrier to trade & investment
Britain is already experiencing a worker and skills shortage. And as we reported in a previous article, this risks Britain’s competitiveness and reputation for investment. May’s pledges on immigration including one to make companies (including public services like the NHS) pay £2000 a year for each migrant worker will make this worse. The manifesto didn’t spell out whether this charge would correspond to EU workers post-Brexit but if it does, it would obviously have huge consequences. And although more money in investing in training for British workers is always welcome, shrinking the talent pool wouldn’t help that.
The Tory manifesto boasts we are the “biggest recipient of foreign investment in Europe”. But Brexit could dramatically change that. In a joint letter to the Financial Times, chief executives from a number of companies including Airbus, Bloomberg, Cisco, Ford, ICM and Microsoft said that a big reason they chose to invest in Britain is its EU membership. They point out that almost three-quarters of foreign investors say that access to the EU’s single market is a key reason for their decision to invest in Britain. They also highlight Britain’s flexible labour market as another reason.
Indeed, these are sentiments made by other governments who have chosen to invest in the UK. Here’s a report on the response to Brexit from the Japanese government in Business Insider. And this report from the Independent in Ireland suggests that Australia will “look to Ireland as a gateway into the EU” instead of Britain.
In a snap response to the manifesto, CBI director general Carolyn Fairbairn said “in a global race for talent and innovation UK firms risk being left in the starting blocks because of a blunt approach to immigration”.