Remain campaigners fell into a trap. Time to move on

London4Europe Committee member and former HM Treasury senior civil servant Michael Romberg shows that the £350m claim was a trap for Remainers. Many fell into it – and some of us are still there. The amount is irrelevant. We need to focus on the right argument: the benefit of contributing to the success of the European Project.

Let’s do the sums

If NHS expenditure after 2016-17 rises at the same rate as in the previous five years, the NHS will get its extra £350m a week in about 2020. That is of course just an arithmetic extrapolation. But with a margin of error as to the year it is very likely to come true. By going on about Leave lies, we lay ourselves open to an easy defeat when the “lie” comes true as the first benefit of Brexit.

It will probably be too hard to disentangle why the NHS received its £350m a week. But suppose Brexit happens and health spending rises as extrapolated; then, since we will probably still be paying a net contribution in the transition period, we can show that we did not have to leave the EU to give the money to the NHS. That will be a cold comfort. The argument that Leave failed to deliver “£350m a week more than the NHS would otherwise have received” will not be provable and will be seen as hair-splitting.

The trap that was set for us

Leave of course quite consciously set a trap for the Remain movement. They used the highest conceivably right figure for the EU contribution. They disregarded the budget rebate, public sector receipts, private sector receipts and the share of EU aid that counts towards the UK’s aid target.

Better numbers to use would have been £250m or £150m a week. Remain campaigners spent a lot of time arguing about the number.

Tactically, that was inept. It just meant that everyone learned about Leave’s claim. And it missed the point. Few of us know whether £350m a week is a big number or a small number in the context of public spending.

Those Remainers who even now go on about “Leave lies” and hold that they invalidate the referendum are still stuck in the trap. (Anyway, to accuse Boris of lieing is unfair. Whatever the actual words, what he means is “Boris should be PM” and he is utterly sincere about that.)

Remain began to fight back

Eventually, Remainers came up with some better arguments than disputing the size: the amount is small in the context of public spending; and the amount is dwarfed by the economic benefits of being in the single market and the customs union.

But those lines while good still missed the point.

No money for Brussels!

What people did not like about the figure was that the money was going to the EU. The sum did not matter. Sure, £350m worked a bit better than £150m would have done. But in practice the Leave claim would have worked just as well if they had used one of the better numbers.

To believe that Leave’s use of the wrong number fundamentally undermined the referendum result you need to believe that voters would say: “If leaving the EU means a 13% increase in NHS expenditure then let’s leave, but if it only means a 9% or 6% increase we will remain”. Yes, prices affect decisions. But for most or almost all Leave voters, the issue was “Let’s take back control” rather than a view of the marginal benefit of where to spend an extra few £bn.

More money for Brussels!

So that is the argument we have to win: why it is better to send money to the EU rather than keep it in the UK. Our reasons:

First, we are a better-off country with above-average per capita GDP. In 2016 we came 10^th in the listing of EU member states by GDP per capita. Even now differences can be large. Poland’s per capita GDP is two thirds of ours and Bulgaria’s less than half. It is right that we contribute more.

Our net contribution is an expression of solidarity with poorer parts of the EU, mostly in Central and Eastern Europe and Iberia who are still coming out of decades of socialist or fascist dictatorship and economic misrule. It is part of our support for the great European Peace and Democracy Project.

Solidarity is not only a moral duty but also benefits us. If our neighbours are democratic, free and prosperous we benefit from living in a safer and more dynamic neighbourhood.

Finally, where shared regulation or decision-making is better than going it alone (eg state aids, aviation, medicines, environmental protection, Euratom …) then we have to pay our share of the cost of those agencies – rather than replicate them at higher cost on our own.

Lesson for 2018 Campaigns

There were two reasons why we did not make those rebuttals in 2016.

One was poor campaigning skills – we allowed ourselves to be distracted.

But it is also that a campaign that focused on trade benefits had lost sight of what was good about the EU. We must not make the same mistake again. We should downplay trade. Instead we should meet Leavers’ concerns over sovereignty and immigration head-on. We should focus on the EU as the European peace, democracy and individual freedom project; and on the EU as a mechanism which strengthens individuals and national governments by collective action where that works best.

STATISTICAL ANNEX

In the June 2016 referendum, Leave campaigners promised an extra £350m a week for the NHS as a result of no longer paying the net contribution to the EU. That comes to £18bn a year.

The 2016-17 UK provisional outturn figure for public expenditure on health (not quite the same as the NHS, but it will do) was £144bn. So the promise will have been fulfilled when health expenditure reaches [£144bn + £18bn =] £162bn.

Over the previous five years, the average annual compound growth rate for health expenditure had been 3.8%.

Extrapolating that growth rate forward would mean that health expenditure reached £161bn in 2019-20 and £167bn in 2020-21.

So Boris’ claim would come true in the year after Brexit.

That was an arithmetic extrapolation, not a forecast. I have ignored the state of the economy, the fiscal position, the Government’s prioritisation of expenditure, when we will stop paying the EU if we Brexit.

Note: one could also do the analysis using different numbers, for example only the NHS (which is the bulk but not all of health expenditure), or only current expenditure, or only England. Because these numbers are smaller than total health expenditure, it would take a bit longer for the Leave promise to be fulfilled. But the difference is not long. And the principle of the argument above is the same.