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15 June 2016

Economic self-immolation is no answer to the immigration question

The UK doesn't need to vote Leave to address concerns - practical solutions are already emerging. 

By Chris Leslie

I can’t recall a more important week in modern British politics than the forthcoming seven days. At stake is the wellbeing and living standards of millions of people, the taxes we pay, the public services we use, the jobs and personal worth of households across the country. The economic consequences of voting out on the 23 June are immense and will hit rapidly if we leave the European Union.

Despite the overwhelming evidence of the risk of an economic downturn, there still are many people hesitating about this decision, tempted to vote “Leave” on the grounds that this will somehow tackle immigration and lead to better control of our borders. This is a dangerous fallacy.

Our population has risen in part because we are all living longer, and an ageing society of course puts pressure on public services. According to the Office for National Statistics, immigration from the EU represents less than half of the inward migration into this country. So while it is legitimate to debate the impact of the movement of labour across the EU, this is only one part of the picture – and needs to be put in the context of reforms already underway.

Following the negotiated changes, access to welfare is about to be restricted for EU migrants, and leaders from across the political spectrum are hearing public opinion loud and clear, now acutely aware of the message from the British public. It is targeted and proportionate action to address flows of EU economic migration that we can have – ameliorating the impact on services and communities where migration has increased. For example, taxes paid by EU citizens working within the UK can generate resources that can be targeted. Stronger border controls to prevent illegal migration are possible. Moreover, discussions of post-Schengen arrangements are already underway across Europe.

So there are sensible reforms occurring and more will follow. But there is a dangerous option that the British people ought to step back from now; incinerating our economy in the mistaken notion that this will somehow be an effective way to tackle immigration. Severing our trade links and trashing our economic prospects would be a complete over-reaction. It’s the equivalent of setting fire to the curtains and burning your house down, just to get people out at the end of a dinner party. Torching jobs and exports and destroying business opportunities is so obviously the wrong way to address concerns about immigration that the British people need to know that there are other, more appropriate choices are available.

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If we show leadership in Europe we can steer a different course. Britain’s forthcoming presidency of the Council of Ministers will come at a time when most other EU nations are themselves reasserting control over their own national borders and are looking for reforms that strike a better balance between the availability of skills across the single market and measures to cope with unprecedented population pressures. The sensible course is clearly to stay with those partners and sort out that better deal, rather than engage in economic self-harm as though that will somehow help.

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Even the Leave campaign accept we will be poorer, with years of financial uncertainty, when in reality we have far more appropriate options at our disposal. The IFS, the vast majority of economists and the markets are all pointing towards the risk of recession following a choice to leave the EU one week from now. As we know, recessions hit the poorest members of society hardest and while it is the impact on employment and incomes that concern me most, those on middle incomes and homeowners would feel the brunt of financial retrenchment too.

Economic self-immolation would be a completely disproportionate response to the important but ultimately solvable concerns about immigration. Instead of pouring petrol all over ourselves and risking everything, I hope that those who are still undecided will pause for thought, step away from the matches, and look at the new answers and practical solutions already emerging to ensure we have a common-sense British way forward. There are commitments now across the political divide to address these concerns. Let’s opt for those realistic solutions rather than leap into the economic flames.