To stay or not to stay? That is the question.
On June 23 we will be asked to decide whether Britain should remain in the European Union, and work alongside other member states to reform it from within, or leave the bloc after 40 years of membership to pursue an alternative relationship with the Continent.
For those of us in financial and related professional services, here in Yorkshire and across the country, the outcome of the referendum will be keenly felt, whichever way it goes. The UK’s status as the world’s leading financial centre is due in no small part to its ties with the rest of Europe.
International firms are drawn to Britain as a gateway to the EU, establishing operations not just in the capital but making the most of the deep pools of talent in thriving financial centres like Yorkshire.
It stands to reason, therefore, that an overwhelming majority of leaders from across my industry – 84 per cent of them – want to stay in a reformed EU.
Since the Prime Minister’s reform deal and referendum date were announced, business leaders have been vocal in expressing their view up and down the country. These voices are so important to the debate because this issue really matters. Not just for people in London, but right across the UK, in Leeds, Sheffield, Halifax and beyond.
The UK-based financial and related services industry is a driver of growth across the nation. Two-thirds of the 2.2 million people working in the industry do so outside London, including 130,000 in Yorkshire. KPMG’s presence in Leeds, and Halifax’s eponymous bank, are just two notable examples.
In my home town of Leeds, 44,000 people work in financial and related professional services, contributing £3.4bn to the UK’s economy annually. Yorkshire as a whole boosts yearly UK GDP by a staggering £9.7bn.
Leaving the EU may not be ruinous for the UK economy, but it risks damaging financial and related professional services and would most likely lead to the loss of jobs and growth across the whole of the UK.
It would also weaken its attractiveness to overseas investors; those international firms already here may consider alternative locations from which they can easily access the Single Market, taking with them opportunity, jobs and talent.
This matters to households and families in every corner of Britain because our industry pays more tax and attracts more foreign direct investment than any other sector. If our industry is weakened, the UK is weakened.
Our evidence shows that industry business leaders are near unanimous that continued access to the Single Market is vital to UK competitiveness. This access has played a crucial role in securing £581bn of investment by foreign businesses into Britain between 2004 and 2014.
The European Parliament and BIS estimate that completion of the Single Market could be worth an additional five to eight per cent to EU GDP.
For the UK, that could be as much as £4,100 per household.
Regardless of the outcome, the hard work will begin in earnest on June 24. A ‘stay’ vote will sound the starting gun on implementing reform. A ‘leave’ vote will mean an prolonged period of uncertainty as a new deal with the EU is negotiated, and we seek to find new ways to secure similar benefits to those we enjoy as EU members today.
Research we published last week highlighted how this period of uncertainty post-Brexit could be seized upon by our competitors, quick to try to snap up the investment that would normally come to the UK.
While it isn’t the place of business to tell people how to vote, we do have a role in explaining the consequences of different referendum vote outcomes. Future generations will live with the outcome of how we vote.
Businesses, from Yorkshire and beyond, have a central role to play in ensuring we do so with the detail we need to make an informed decision.