The prospect of Britain leaving the EU is creating great uncertainty in the economy, according to former Business Secretary Sir Vince Cable.
Speaking to The Yorkshire Post, Sir Vince Cable said that there would be several years of disruption and the UK would lose jobs and investment in the event of a Brexit.
Sir Vince said: “I think many companies which have made a long-term commitment to the UK have made that commitment on the basis of our being part of the single market.
“If that no longer existed we would lose a lot of that investment in the future.”
The Liberal Democrat peer was in Leeds to talk at the Manufactured Yorkshire conference. Sir Vince said that “we under promote and under sell” the country’s manufacturing strength.
He added: “We hear all the doom and gloom around the steel industry particularly but the quiet success stories we don’t hear about and food manufacturing in Yorkshire is a good example, the car industry, the aerospace industry, the reshoring of textiles on a large scale.
“These are very important and positive developments.”
Yorkshire is one of the main production centres when it comes to manufacturing, Sir Vince said, but that the sector tends to get overlooked as the world is so London-centric.
He added: “Because the national media, the politicians, the bankers are always gathered in London, which isn’t a manufacturing centre, we tend to overlook it.
“Yorkshire is crucial. Both South Yorkshire and West Yorkshire contain some of our most successful companies.”
Sir Vince said that it was easy to be cynical about the Northern Powerhouse but there is a genuine transfer of power to local areas.
However, he said that Yorkshire hasn’t “got its act together” like Manchester has. “There’s still too much petty local squabbling,” he added. The former Business Secretary said that the Conservative Government was slow to react to unfair Chinese competition in its handling of the steel crisis.
He said: “We knew there were problems with the steel industry. When I was Secretary of State I spent a lot of time dealing with it. So nobody had any excuse to be unprepared.”
However, Sir Vince did welcome the Government’s most recent response to take a 25 per cent stake and co-invest with any potential buyer for Port Talbot steel works.
“They are now in a pretty good place to deal with a very difficult problem,” he added.
Sir Vince said that it was “terribly important” that British steel does survive as it is a highly sophisticated industry, that provides some of the specialist materials that are fundamental to the supply chain.
“It is very important that it survives under new ownership and gets new investment,” he said.
“I don’t underestimate the difficulties because there’s a vast amount of spare capacity in the world, particularly in China, and that depresses prices and makes it very difficult to make money.”
There’s no unanimous view in business when it comes to Brexit, says Sir Vince, but on balance business is for remaining in Europe.
“I have talked to the main business associations and the manufacturers tend to be split about 80-20 in favour of remain.
“The other business groups probably 70-30, 60-40 at worst,” he said.
At the conference, Sir Vince took part in a panel discussion with Kevin Butterworth from Seabrook Crisps; Dr Hamid Mughal, director of manufacturing at Rolls-Royce; Sarah Hodgetts, Department of Business Innovation and Skills; and Bill Macbeth, managing director of the Textile Centre of Excellence.
A question on HS2 cropped up during the Q&A and Sir Vince told the audience that HS3 should be put up the pecking order because it is easier to deliver.
Mr Macbeth said: “If there’s ever been a misnamed service it’s the transpennine express. I suffer from it and I know many of you do.
“Getting that lateral connection should be the number one priority.”
‘We can’t afford to look back’
Sir Vince Cable says that whether the British people vote to leave the EU is 50-50.
He said: “At the end of the day I think a lot of people who are toying with the idea of Brexit will realise that it could be very damaging and very disruptive and will stick with it.
“The people who are mostly pushing for exit tend to be older people, retired people, who have got a kind of nostalgia for the past. But we can’t afford to look back we’ve got to deal with the world as it is.”
While Brexit remains the number one threat to the economy, Mr Cable says that uncertainty over China and the Eurozone also pose threats. He also said the Western world is “dangerously dependent” on cheap money.