My Lords, during the referendum debate on
My concern is that if we are not in the EU, the French will stop buying our avionics, the Germans our pharmaceuticals and both will stop buying our insurance. As other noble Lords have pointed out, half of our trade is with the EU. If we are not in the EU, will the French and Germans invest in the new power plants that we so desperately need, and will Asian investors restart our steel plants and invest in our car factories? Of course not, as the noble Lord, Lord Shipley, explained. It is outrageous to risk all of these actual jobs and investments with some kind of imaginary option which probably does not exist in reality.
The opposite is true: we should be taking even more advantage of our association, and the timing is right. With a weak pound, rising prices in Asia and supply chain problems, the word near-shoring is beginning to be heard, as my noble friend Lord Giddens told us, not for cheap goods but for better-quality good, branded products and advanced technology. As the noble Lord, Lord Newby, explained in his opening remarks, this is a time of turmoil in the eurozone, but as ever in business, that is the time to invest in the spadework, as my noble friend Lord McFall explained.
Is it that the Government see devaluation as the route to our future, and if so, for how long? The pound has devalued by 30 per cent against the euro in the last five years and surely this devaluation is one reason for the high inflation we have now. It is the less well-off who pick up the tab for this strategy. If we are to seek economic growth within the EU it must be more for the excellence of our business, and less through devaluation.
So, with devaluation less of an option, how do we encourage economic growth? The Government want to achieve it by returning powers from Brussels-repatriation, as the noble Lord, Lord Hannay, put it. So, what are these powers? It seems to me that they deal with the way in which we run our businesses: terms of employment, labour relations, regulation. The theory is that we can compete better with a more flexible labour market and less regulation. This argument has been around for years-long enough for us to judge whether or not it is true. I put to the Minister that in practice the argument no longer stands up. So-called flexibility does not create more value. That is why a lot of businesses have moved on. They are putting into practice the social values that help create the motivation and commitment that are acceptable to the markets and to people, and which make their businesses more trusted and create longer-term value for all. Withdrawal of powers will not make us more competitive.
I will say one more thing-this time to the noble Lord, Lord Pearson. The big idea has not failed. For my generation the EU is more than economics. It is peace instead of war, as the noble Lord, Lord Bilimoria, said; it is shared prosperity instead of social divisions; it is mutual support in an interdependent world. Europe is certainly far more than the pleasures of driving a Mercedes car or drinking fine Bordeaux wine.