ContractorCalculator was in attendance yesterday as various Members of Parliament debated the impact that a Brexit would have on UK contractors and the small business community.
Lucy Thomas, deputy director of Britain Stronger in Europe, was joined by Labour MP Yvette Cooper in arguing the case to remain in the EU. They were opposed by Conservative MP David Davis and Douglas Carswell of the UK Independence Party.
The debate was organised by the UK200Group - the country’s leading membership association for accountancy and law firms, who collectively act for over 150,000 small businesses across the UK - as part of its ‘Campaign for Clarity’.
UK200 president, and regular contributor to ContractorCalculator, James Abbott said: “As an important component of our economy, it is vital that the UK’s contractors and SMEs have clarity over the impact that opting in or out of the EU would have on them, before they place their votes on 23 June.”
One point of contention focused around the UK’s fate with regards to trading overseas and the subsequent costs to UK contractors and businesses in the event of a Brexit.
“We have so many benefits as a member of the EU, free movement of labour being just one,” argued Thomas, who highlighted the likelihood of tariffs and further barriers being imposed on companies providing services overseas if Britain were to opt out.
“The leave campaign can’t tell us what the trade deal would be, but they do promise us that trade will somehow be better if we opt out. They’re living in a fantasy land. If we are outside of the single market, the fact is the cost of trade will be higher, particularly for our services,” added Cooper.
Addressing the severe skills shortages faced by many sectors, Carswell argued that leaving the EU would allow the UK to form a rational immigration system that could identify and attract expat contractors with the necessary skills from further afield:
“We’re currently saying no to doctors from India and software engineers from Singapore, but yes to people without the skills we need who are based in Europe. If we were to leave, we could form a points and skills-based immigration system that attracts the brightest and the best.”
“At the moment, the price of having access to the single market is to have the same arrangements regarding free movement of labour,” said Cooper, who conceded that reforms are needed to EU rules whereby migration arrangements are aligned more closely with those outside of Europe. “But the idea that opting out will solve the issue is another false promise.”
Contractors inevitably fare better when the economy is thriving, and the uncertain impact of a Brexit upon the UK economy has been the most divisive topic over recent weeks.
Highlighting the impact of an economic downturn upon contract and employment opportunities, Thomas cited a PwC article estimating that a Brexit would result in a cost to the UK economy of £100bn and the loss of 150,000 jobs by 2020.
In response, Carswell nodded towards the UK’s financial contributions to the EU – a sum that was contested by Turner - suggesting that it would be better invested closer to home:
“Leaving the EU would not only allow us to take back control over law-making, but also over the £350m each week that we hand over to Brussels – that’s £19.2bn a year. Think of what we could do with that money. We could improve the NHS or possibly afford tax cuts.”
“We get back far more than we put in in terms of trade. The hit to our economy would be around £2bn a week,” countered Cooper. “Yes, we put something into the EU, but we get so much more back. That is what we put at risk by voting to leave.”