Newspaper article The Evening Standard (London, England)

Cameron's Big Euro Gamble with Economy

Newspaper article The Evening Standard (London, England)

Cameron's Big Euro Gamble with Economy

Article excerpt

Byline: Anthony Hilton city comment

NEWS that membership of the Scottish National Party had surged to almost 90,000 must have caused a degree of angst at the Labour Party, with 190,000 members, and the Conservatives, with 170,000. Both of them have a population 10 times larger to recruit from.

The decline in membership of the two big parties from the millions they had signed up in the postwar years is dramatic. According to the last census, there are now more people 176,632 who say that their religion is Jedi Knight than claim to be Tory Party members. It must say something about the state of British politics when the Tories attract fewer followers than a Hollywood fantasy cult of space travellers from another galaxy.

This dwindling membership average age 74 is a major reason for David Cameron's troubles. The local membership, some 0.25% of the UK population, select the Tory candidates for Parliament. If you want to be a candidate, it pays to share the members' traditionalist views on gay marriage, immigration and the European Union. Getting elected requires appealing to the moderate centre, but Cameron's party and MPs demand the opposite.

So it is not surprising the Prime Minister is struggling to curb his party's Europhobia. Creating a European policy that could unite the Tory party frustrated Macmillan, undermined Heath, toppled Thatcher and ruined Major. Now it is pushing Cameron, with his promised renegotiation and referendum on EU membership, to take a huge and reckless gamble with Britain's economic future.

The campaign, let alone the result, could be seriously destabilising. One of the little-noticed side effects of the Scottish referendum was, that as the campaign warmed up, businesses' desire to invest cooled down. Investment plans were put on hold while companies waited for the vote. Allianz Global Investors, in a report after the event, identified well over PS1 billion of infrastructure investments from hospitals to a new Aberdeen ring road which foreign backers had shelved pending the outcome.

Although the EU referendum is not scheduled until 2017, the campaign will start immediately after the next general election if the Conservatives remain in government. Business hates uncertainty; overseas investors worry about it and the political risk is even greater. If investment into Scotland dried up in the months before their vote, how much more likely is it that investment into the UK will do so in the two years before the EU vote? We should be in no doubt that such a slump would be quite enough to send our slowly recovering economy back into a tailspin.

Is it really worth the risk? What problems does Britain face that are so great leaving the EU would be the solution? The stock answer is immigration. …

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