The UK can “learn lessons from Singapore” said Jeremy Hunt last week, visiting the south-east Asian city-state. The Foreign Secretary was burnishing his credentials as a potential Conservative leader.
By lauding the low-tax, low-regulation island, Hunt was trying to appeal to fellow Tories who want post-Brexit Britain to slash red tape and taxation, becoming a “Singapore of the North”.
With Theresa May looking increasingly vulnerable, candidates to replace her have spent the Christmas holidays trying to impress grass roots Conservative members who will likely choose her successor. That’s particularly true of candidates who, like Hunt, voted Remain.
I groaned inwardly when I heard the Foreign Secretary linking Brexit to Singapore – even if, since gaining independence from Britain in the mid-Sixties, this tiny land mass, packed with almost 5m people, has prospered to become, in per capita terms, the eighth-richest nation on earth.
Why? Because UK voters didn’t opt to leave the European Union in June 2016 to make Britain more like the tip of the Malay Peninsula. Some Conservatives do see Brexit as a chance to light a bonfire of regulations, yes, hoping to turn the UK into some kind of European “Asian Tiger”. But many other voters backed Brexit because they want a “mixed economy” approach instead – with more “state aid” and other forms of regionally focused government assistance currently impossible under EU rules.
And that’s the point. Brexit was never about taking the UK economy decisively in one direction or the other. The coalition to leave was broad, ranging from libertarian small-state free-marketeers all the way through to trade unionists, diehard socialists and others wanting government to spend far more.
What this diverse group wholly agrees on, often passionately, is the need for democracy – that is, UK laws made by UK-based politicians answerable to UK-based voters, not remote Brussels-based bureaucrats lobbied relentlessly by big business. Brexit brings British policymaking back to where it belongs – closer to the people directly affected who, as a group, can then periodically exert democratic control. That’s what it was about.
Since June 2016, the UK’s political and media establishment has obsessed over the procedural mechanics of leaving the EU, a process made infinitely more tortuous by the sabotage tactics of much of that same establishment. There’s been almost no discussion, in contrast, of what really counts – the actual policies we should implement once Westminster has regained control over Britain’s laws, borders, money and trade.
What we should have been debating over the last two years, is how to use these newfound Brexit freedoms to benefit the broadest possible range of UK voters. So, in this first column of 2019, before parliamentary trench warfare resumes, allow me to say that I’d like to see post-Brexit Britain forge domestic policies based on strong growth, buoyant wages and high investment.
Freed from EU “structural fund” restrictions, there is huge scope for a revamped and much more effective UK regional policy, for instance, boosting growth beyond London and the South East. Closing the productivity gap between the capital and elsewhere definitely means more regional infrastructure spending.
I’d introduce infrastructure bonds channelling institutional savings (such as pension funds) into revenue-generating projects, together with a national transformation fund seeded by central government. Post-Brexit agriculture and fish policies – shifting subsidies towards smaller farmers while reclaiming UK fishing grounds – would also spread wealth more evenly across the country. So would a dozen low-tax UK “free ports” – again, forbidden under EU rules.
The UK’s sovereign industrial policy should avoid “picking winners”, creating instead an enabling environment for personal and corporate enterprise – based on relatively low and simple personal and business taxation, world-class transport and broadband connectivity, reasonably priced energy, a steady supply of both skilled and unskilled labour and access to fast-growing international export markets.
Skills must be central to the UK’s post-Brexit policy mix. Securing a high-wage, high-productivity economy means putting vocational training at the heart of government – with its own Cabinet position. Brexit need not mean an erosion of workers’ rights and a regulatory race to the bottom. Despite much scaremongering, I don’t think it will. The reality is that Britain pioneered much of the workers’ rights legislation now taken for granted across the EU.
Workers’ rights should be protected, and indeed, with sovereignty returning to Westminster, Parliament will be beholden to the British people in ensuring they are.
There should be considerable emphasis on encouraging the UK’s small and medium-sized enterprises. Many have been held back by Brussels, with all firms absorbing the cost of complying with bureaucratic and often unnecessary regulations, even though less than 10pc of them export to the EU. UK firms in fields from biotechnology to agribusiness, energy and fintech will now have the opportunity to innovate and expand in ways not previously possible.
It’s also vital we develop a managed immigration system providing the overseas labour and talent the economy needs, while restoring badly dented public confidence in UK border controls. Students, though, should be removed from immigration numbers. Britain’s world-class universities generate huge export revenues and valuable global contacts. They must be allowed to flourish.
Since 2016, against a drumbeat of relentless negativity, belied by UK growth data, our political leaders have been largely silent on the opportunities provided by Brexit.
Hunt, for his own political purposes, now randomly points to “Singapore”. But while there is much to admire about the city-state, for most voters it seems to be relentlessly competitive, barely resembling the UK and with only a very limited welfare state.
As MPs return to Westminster, with many determined to keep us in the EU, it’s hard to think of a message more likely to weaken the broad coalition of decent centrist opinion that remains vital to getting Brexit through Parliament and over the line.
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