Member Article

Political heavyweights promote EU advantages to small businesses

Former Business Secretary Sir Vince Cable and former Shadow Business Secretary Chuka Umunna have teamed up to urge the UK’s small business owners to vote to stay in the European Union at next month’s Referendum.

The two politicians, who opposed each other across the dispatch box during the last government, joined forces at an event hosted by the EU Small Business campaign to specifically address issues facing small businesses.

“Many small companies are part of the supply chain for bigger companies and many small companies aspire to be bigger companies. That’s in the nature of setting up your own business,” said Cable.

“The big issue for small companies is the general state of the economy. If the economy is doing well small companies, particularly in the retail sector, will do well. A large part of the argument is how we expect Brexit would affect the overall economic climate of the country. Most people acknowledge, on both sides of the argument, that if we vote to leave there will be a period of maybe two or three years of chronic uncertainty. We don’t know what the alternative arrangements will be; we don’t know which model any post-Brexit government would choose and we don’t know how the other European Union countries will react and that, in turn, affects the growth of the economy and how business operates.”

The former business secretary also addressed what he described as the other argument always brought up in the context of small business, the cost of regulation.

“I was in charge of all of this for five years in government so I saw it first hand,” he said. “Most of those regulations emanate from this country. Many of the regulations that small businesses in particular find irksome tend to be generated at home and I created many of them – shared parental leave, auto-enrollment etc. This is all good progressive legislation and it did have a cost for business but it was nothing to do with the European Union.”

Former Shadow Business Secretary Chuka Umunna agreed:

“People are really crying out for facts,” he commented, “facts that can stand up to scrutiny and which can help inform business owners when they are making a decision on whether to stay in or not.” He was keen to focus on the benefits for businesses, including small businesses, of being part of the Single Market. “As a member of the European Union we are part of this free trade zone which we can access freely. Businesses are not islands. If you look at retail, for example, 28% of the produce on the shelves of our high street stores comes from the EU. That’s £2.2 billion worth of wine imports, £1.4 billion worth of cheese imports and £1.1 billion worth of chocolate imports. If we were not in the Single Market but trading with the European Union along the lines others have suggested under World Trade Organisation rules, all of those goods would be subject to tariffs, which smaller businesses would have to pass on to their customers. So there’s a very tangible example of how, even if you are not a small business that exports, how being part of this single market is a benefit to our small businesses. And if you were a small business looking to trade internationally across multiple channels you are able to sell into one big market with a single set of rules, not 28 different sets of standards with which you would have to comply. The different Leave campaigns have conceded the fact that we will not be able to trade in the same way that we do now if we were to leave the European Union.”

Umunna was also keen to talk about the implications for small businesses with growth potential and aspirations:

“We need to ensure that more of our smaller businesses can grow to become larger businesses. We need to ensure we are providing good support to those fast growth companies that will expand and be able to provide more jobs. If we have businesses that are looking to go into the emerging markets, you have to have a domestic, home market within which you can scale up and then build the capacity that enables you to exploit those emerging markets. The Single Market is that big domestic market of 500 million people. This would be massively reduced to a market of 65 million people if we were to come out of the European Union.”

Small business owners can connect with the campaign on Facebook and Twitter @EUSmallBiz and via its website, www.eusmallbusiness.com.

Ends.

This was posted in Bdaily's Members' News section by Howard Robinson .