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The real reason the Tories can't turn the UK into a post-Brexit tax haven

The Brexiteers attacking Philip Hammond should remember that the Conservatives don't have a parliamentary majority. 

“The British people are not going to lie down and say, too bad, we’ve been wounded,” Philip Hammond warned back in January. Were the EU to deny the UK a beneficial trade deal, the Chancellor told German newspaper Welt am Sonntag, “we will change our [economic] model”. Tax cuts and deregulation would be deployed to transform Britain into a free market upstart capable of undercutting Brussels. 

Six months later, Hammond is arguing the diametrical reverse. “I often hear it said that the UK is considering participating in unfair competition in regulation and tax,” the Chancellor told Le Monde. “That is neither our plan nor our vision for the future. The amount of tax we raise as a percentage of our GDP puts us right in the middle of the pack. We don’t want that to change, even after we’ve left the EU. I would expect us to remain a country with a social, economic and cultural model that is recognisably European.”

Unsurprisingly, the Chancellor is being mocked from all sides for disagreeing with himself. “It’s one thing for cabinet members to contradict each other, but Hammond is taking the art of the Tory rift up a level – and creating a cabinet split with himself,” wrote Spectator editor Fraser Nelson. “This government has broken down into farce,” declared Labour's shadow chief secretary to the Treasury Peter Dowd. “The Chancellor is not only disagreeing with cabinet colleagues over Brexit, he is now in open dispute with himself given it is only his own comments on the matter in January which he is pretending to contradict.”

But there's an important point such derision ignores. In between Hammond's interviews there was the small matter of a general election. Had the Conservatives won the large majority they expected, the threat of a free market Brexit would remain. But without a majority at all, it is inconceivable. The Tories simply do not have the votes they need to slash taxes and regulation (as I noted last week.) Britain will not become the Hong Kong of the west (the oft-cited Singapore is a hotbed of interventionism.)

Though the hard Brexiteers will blame the “soft” Hammond for repudiating this path, the true blame lies with the voters. Had the Tories stood on the libertarian manifesto proposed by some, they would likely have fared worse, not better. As Labour's performance demonstrated, many voters crave a larger state. The Conservatives' free market wing has long hoped to use Brexit as a Trojan Horse to remake Britain as a low-tax, small-state utopia. But as Hammond has accurately surmised, that option no longer exists. 

George Eaton is political editor of the New Statesman.

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Our union backed Brexit, but that doesn't mean scrapping freedom of movement

We can only improve the lives of our members, like those planning stike action at McDonalds, through solidarity.

The campaign to defend and extend free movement – highlighted by the launch of the Labour Campaign for Free Movement this month – is being seen in some circles as a back door strategy to re-run the EU referendum. If that was truly the case, then I don't think Unions like mine (the BFAWU) would be involved, especially as we campaigned to leave the EU ourselves.

In stark contrast to the rhetoric used by many sections of the Leave campaign, our argument wasn’t driven by fear and paranoia about migrant workers. A good number of the BFAWU’s membership is made up of workers not just from the EU, but from all corners of the world. They make a positive contribution to the industry that we represent. These people make a far larger and important contribution to our society and our communities than the wealthy Brexiteers, who sought to do nothing other than de-humanise them, cheered along by a rabid, right-wing press. 

Those who are calling for end to freedom of movement fail to realise that it’s people, rather than land and borders that makes the world we live in. Division works only in the interest of those that want to hold power, control, influence and wealth. Unfortunately, despite a rich history in terms of where division leads us, a good chunk of the UK population still falls for it. We believe that those who live and work here or in other countries should have their skills recognised and enjoy the same rights as those born in that country, including the democratic right to vote. 

Workers born outside of the UK contribute more than £328 million to the UK economy every day. Our NHS depends on their labour in order to keep it running; the leisure and hospitality industries depend on them in order to function; the food industry (including farming to a degree) is often propped up by their work.

The real architects of our misery and hardship reside in Westminster. It is they who introduced legislation designed to allow bosses to act with impunity and pay poverty wages. The only way we can really improve our lives is not as some would have you believe, by blaming other poor workers from other countries, it is through standing together in solidarity. By organising and combining that we become stronger as our fabulous members are showing through their decision to ballot for strike action in McDonalds.

Our members in McDonalds are both born in the UK and outside the UK, and where the bosses have separated groups of workers by pitting certain nationalities against each other, the workers organised have stood together and fought to win change for all, even organising themed social events to welcome each other in the face of the bosses ‘attempts to create divisions in the workplace.

Our union has held the long term view that we should have a planned economy with an ability to own and control the means of production. Our members saw the EU as a gravy train, working in the interests of wealthy elites and industrial scale tax avoidance. They felt that leaving the EU would give the UK the best opportunity to renationalise our key industries and begin a programme of manufacturing on a scale that would allow us to be self-sufficient and independent while enjoying solid trading relationships with other countries. Obviously, a key component in terms of facilitating this is continued freedom of movement.

Many of our members come from communities that voted to leave the EU. They are a reflection of real life that the movers and shakers in both the Leave and Remain campaigns took for granted. We weren’t surprised by the outcome of the EU referendum; after decades of politicians heaping blame on the EU for everything from the shape of fruit to personal hardship, what else could we possibly expect? However, we cannot allow migrant labour to remain as a political football to give succour to the prejudices of the uninformed. Given the same rights and freedoms as UK citizens, foreign workers have the ability to ensure that the UK actually makes a success of Brexit, one that benefits the many, rather than the few.

Ian Hodon is President of the Bakers and Allied Food Workers Union and founding signatory of the Labour Campaign for Free Movement.