Viewpoint: Breaking off the Brussels handcuffs

The EU is holding back the UK’s small and medium businesses in favour of large multinational corporations writes REID Steel’s Simon Boyd

Simon B - IMG_4262

I sometimes wonder if the people campaigning for Britain to stay in the European Union have actually had any experience of running a business that has to cope with the day-to-day reality.

The Remain camp too often seem oblivious to the endless red tape spewing out of Brussels and the real damage it does to the competitiveness of British businesses. Meanwhile, the single market, the only reason we joined, has failed to deliver, with enormous trade deficits every year.

My decision to vote to leave is based on my experience of working in an SME, not on the theoretical benefits the EU is supposed to bring.

Our company has exported to 140 countries around the world – but we now do almost no business in the EU. The obstruction, protectionism and bureaucracy make it virtually impossible. We would rather work in a growing world outside, which is open for business and pleased to buy British.

My decision to vote to leave is based on my experience of working in an SME, not on the theoretical benefits the EU is supposed to bring.

The top 100 Brussels regulations alone cost the economy £33bn a year. On top of these costs we have to pay a £350m-a-week membership fee to the EU. SMEs, which employ 60 per cent of the workforce, cannot afford the human resources and compliance departments that multinationals employ, so we are at a disadvantage. Only six per cent of British companies export to the EU but all are lumbered with the regulation.

Our recent experience of trying to do business in France has underlined just how empty the rhetoric about the single market really is. Because of this discriminatory rule, we had to walk away from a seven-figure contract in Toulouse, and another in Calais to provide buildings for security fencing against migrants trying to smuggle themselves to Britain, even though our government paid £17m towards the cost.

If a company is going to work in France in our industry (designing, manufacturing and erecting steel structures) it is required to buy 10-year liability insurance. But under French law, these so-called decennial policies can only be bought by French companies. This means businesses based in other EU countries are closed out unless they are willing to set up a full subsidiary in France.

We raised this issue with our government, which is powerless to do anything. We have taken the issue to the EU, but it has done nothing. A multinational could easily open a new subsidiary in France or pay lawyers and lobbyists to work the Brussels corridors and pursue the complaint. But those options are too expensive for a business our size.

SMEs are also disadvantaged when dealing with Brussels red tape, which is so costly that it damages our ability to compete for contracts not just inside the EU, but around the world. When it comes to employment regulation, for example, we are required to go through all the same hoops as multinationals, but without the resources.

European health and safety standards are a particular problem. They have generated a huge paperwork industry, but have achieved precious little to put unscrupulous employers out of business. The UK enforces the rules far more rigorously than other member states, putting us at an unfair disadvantage both in the EU and globally.

The CE European conformity mark is another costly and unnecessary piece of paperwork for us. Unlike the globally respected British Standards, which are being eroded and replaced with ‘euronorms’, the CE mark does not guarantee good design, safety or quality. What it does is eliminate start-ups and innovation to the benefit of multinationals; the beginner cannot get into the pool until they prove that they can swim.

The EU is incapable of serious reform and improving business competitiveness comes a long way down its agenda.

There are looming threats from Brussels that will make day-to-day operations even more expensive. The EU is trying to end the right of British workers to opt out of the 48-hour weekly limit in the Working Time Directive, which will be damaging to the flexibility British businesses need. A staggering 90 per cent of UK steelworkers polled want no restriction on their right to choose when they want to work.

For a long time, I persevered with the EU. I hoped the prime minister would be able to win meaningful reforms. He achieved none of his pledges and nothing of use to us.

The EU is incapable of serious reform and improving business competitiveness comes a long way down its agenda. This is because reducing the burden of regulation means reducing the power
of Brussels and the European institutions’ priority is always to centralise power. It responds only to the 15,000 lobbyists in Brussels, all working for the big companies and multinationals.

The EU is doing immense damage to Britain’s global competitiveness, holding back our SMEs and stifling enterprise. We cannot hold the people who make those rules to account. We need to take back control, design the right rules for our economy and help, not crush, our small and medium businesses. The only way we can achieve this is to break off the Brussels handcuffs and vote to leave the EU.