Cable claims Cameron’s EU stance has blighted Britain

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Vince Cable has attacked the Prime Minister for “blighting” the British economy and damaging investment prospects with his call for an EU referendum.

Speaking to the Yorkshire Post at the Liberal Democrat spring conference in York, the Business Secretary said investment in Britain has already suffered badly as a result of David Cameron’s pledge to hold an in-out referendum if he wins the next election.

Mr Cable said the “uncertainty” created by Mr Cameron’s pledge last year is “unhelpful” for the economy, and that he frequently speaks to business leaders worried about the impact a British exit from the EU would have.

“If the Conservatives are successful in getting their referendum, we’re going to be debating this for years – and that is part of the problem,” Mr Cable said. “It is creating blight.

“It is seriously affecting businesses’ commitment to investment. I meet lots of businesses – the car industry, the banks. And they all make the point: we want to be sure that Britain is still part of this market, and is not going to face trade barriers.

“It has created uncertainty that we don’t need and isn’t helpful.”

The attack on the Tories’ policy on Europe is just the latest row between Mr Cable and his Coalition partners, following a dispute over immigration which has rumbled on for the past week.

“They’re clearly very worried about Ukip,” Mr Cable said. “If I was giving them advice, I would tell them to stick to the facts rather than panic – but it’s not my party.

“What I’m more concerned about is that they do damage to the national interest by taking up positions as they have on the European referendum, which blights future investment.”

The Business Secretary defended his decision last year to strip South Yorkshire of tens of millions of pounds of European funding, making clear there will be no turning back from the decision to hand the money to Scotland and Wales instead.

“There is only a fixed pot,” he said. “Those areas who do relatively less well are going to feel badly done by. (But) most parts of the North have done relatively well. If you give more to one area, you have to take it from somewhere else.”

Meanwhile, reports this week suggested Britain may need an extra year of austerity after the election in order to balance the books.

Mr Cable agreed the election will be fought in part on how the necessary savings are made in the second half of the decade.

“We’ve made substantial progress, but there is more to do,” he said. “There is an issue after the election – an issue about how far you manage the budget through (extra) taxes or spending (cuts), and my party haven’t yet decided that.

“My argument has been that even though we have to balance the budget, we can’t cut back on things that are really valuable for the long-term recovery of the economy.”