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The Government’s EU Leaflet: Fact-Checked

We’ve taken a look at the government’s leaflet and sources. Here are our findings.

Every household in the United Kingdom by now will have received the government’s leaflet – “Why the Government believes that voting to remain in the European Union is the best decision for the UK.” There’s been much controversy over the contents and alleged bias of the leaflet with many choosing to return it directly to Number 10. We’ve decided to take a look at some of the claims made and fact-check the details.

Author’s note: I am the son of an EU migrant. The sources for all information below can be found in the linked words (in red). Clicking on these links will take you to the page of any publication quoted.


1. Jobs & Exports

The Quote:

“Over 3 million UK jobs are linked to exports to the EU”

The Facts:

This is only an estimate of the number of people in jobs at companies that export to European Union member states. This also includes those in the supply chain – from local businesses supplying lunches to rubber manufacturers supplying raw materials. The important part to take away from this is that the “3 million” number doesn’t really tell anything about the actual number of jobs created and maintained exclusively due to our EU membership.

This figure comes from a calculation made 16 years a go, as well as reports issued by the National Institute of Economic and Social Research, and London’s Southbank University.

The Institute’s report states:

  1. “There is no reason why being outside the EU should necessarily involve mass unemployment.”
  2. “There is no a priori (theoretical) reason to suppose that many of these [jobs], if any, would be lost permanently if Britain was to leave the European Union.”

Southbank’s report states:

  1. “The aim of the present investigation is not an overall evaluation of EU membership.”
  2. “… previous studies have sought to answer the question of what would have happened if Britain were not a member of the EU, we do not seek to test this counterfactual hypothesis.”
Leaflet quote source: Page 5

2. Trade

The Quote:

“The EU is by far the UK’s biggest trading partner. EU countries buy 44% of everything we sell abroad, from cars to insurance.”

The Facts:

Government figures show that in 2014 nearly 44% of good and services exports from the United Kingdom went to EU member-states. Let’s compare this to other exports:

  • 21% shared between North and South America.
  • 19% to countries in Asia.
  • 11% to European nations outside of the EU.
  • 5% to the rest of the world.

However, it’s important to note the steady decline of the export share to the EU, and the increase of export share to nations outside of the EU. It’s also important to note that it is not hard to “adjust” these figures. I’ll explain the process step-by-step:

  1. A UK company exports 1000 units.
  2. These units are shipped to Rotterdam, a major shipping hub in the Netherlands (an EU country).
  3. The units are then sent to Canada.
  4. Because these items left the UK and went to the Netherlands, they are now counted as a UK export to the EU – despite the fact that these items were never going to be sold or used in the EU, but in Canada.

The above is known as the “Rotterdam effect” and is known to be problematic when evaluating the true level of good exported to the EU. Both the Office for National Statistics and HM Government concur, concluding that it’s hard to quantify the true extent and how much, if at all, it interferes with statistics.

Leaflet quote source: Page 4

3. Employment Rights

The Quote:

“EU membership means you and your family have the right to live, work or study abroad in any of the 27 other member countries. It also guarantees many employment rights.”

The Facts:

The first part of the sentence is certainly correct – all UK citizens have the right to live, study, and work in any European Union country. This also works the other way around, with nearly all countries having access to the UK’s jobs market, housing, and education. The free movement of people is one of the core principles of the EU.

Now we’ll take a look at the claim about employment rights. The UK introduced a national wage and nearly 20 other employment rights before the EU existed, however, the EU has introduced policy which became law in the UK since approximately 1987, some of these include:

  • The Equality Act 2010
  • Data Protection
  • The Working Time Directive

It’s important to note that a national wage (or living wage) is not part of EU law and has existed in the UK for 19 years, with many EU nations lacking a similar requirement. Leaving the EU would not necessarily change any rights for workers in the UK – it would be up to the government of the day to decide which rights, if any, would change.

As with all EU law, staying in the EU does not mean these laws will remain in place – they are liable to removal, change, or adjustment if needed.

Leaflet quote source: Page 12

4. Cost of being a member of the European Union

The Quote:

“For every £1 paid in tax, a little over 1p goes to the EU. The Government judges that what the UK gets back in opportunities, job creation and economic security from EU membership far outweighs the cost.”

The Facts:

The exact figure is between one and two pence out of every pound, or around 17% of tax paid by UK workers, however, the amount we pay to the EU changes from year to year. The figure is somewhat misleading, though, as the calculations are not as simple as a flat percentage.

The figure used in the government’s quote is based on the UK contribution to the EU budget minus the rebate and spending in the UK. This is called the net contribution and comes to just over £7 billion per annum between 2010 and 2014. The “1p” figure is the result of taking this figure, comparing it to all government income, then averaging it. This works out at roughly £600 billion per year, which equals around one pence in every pound.

However, if we use the actual taxes – as quoted – and then look at what’s sent to the EU before the rebate, we see the figure as being two pence in every pound from taxes. It’s a misleading figure and oversimplifies the amount.

Leaflet quote source: Page 12

5. Justice

The Quote:

“EU cooperation makes it easier to keep criminals and terrorists out of the UK.”

The Facts:

Between 2004 and 2014, over 7,000 suspects were extradited from the United Kingdom using the European Arrest Warrant and approximately 1,150 suspect were sent back to the UK using the same power. Multiple security procedures and arrangements have been created by the EU, with the UK choosing to opt-in to some of them. These include:

  • European Arrest Warrant
  • Schengen Information System
  • European Criminal Records System

The media has been critical of the member states’ failure to share information, with the Financial Times stating: “… it [the Belgium terror attack] would also highlight the tortuous difficulties European intelligence agencies have had in identifying and sharing information on members of the world’s most dangerous terrorist organisations.” It’s hard to tell whether or not the EU would continue to share information with the UK if the public voted to leave. The European Arrest Warrant does not apply to nations outside of the EU, but Norway does have a similar arrangement without being a full member of the European Union.

Leaflet quote source: Page 12

6. Security

The Quote:

“EU membership means UK police can use law enforcement intelligence from 27 EU countries, and will have access to fingerprint and DNA information. EU cooperation makes it easier to keep criminals and terrorists out of the UK.”

The Facts:

The UK utilises a number of methods to share intelligence with EU intelligence and security agencies, however, if the UK leaves the EU, access to these might be limited or lost. At present, the UK has access to the European Criminal Records Information System, a mechanism allowing EU nations to exchange information (including fingerprints) contained in their national records databases. This can be used for the conviction of EU citziens and only applies to EU members.

The UK is planning to sign up to the Prum Convention – an arrangement were British nationals’ DNA, fingerprints, and vehicle information will be shared between countries that are part of the arrangement. Crucially, the Convention allows non-EU members to sign up.

However, it’s very important to note that the UK is bound by the UKUSA Agreement, also known as the “Five Eyes” agreement. This is an alliance and treaty where signals information is shared between Australia, Canada, New Zealand, the United Kingdom, and the United States. This arrangement would not be affected by the UK leaving the EU.

Leaflet quote source: Page 10

7. Borders & Immigration

The Quote:

“The UK is not part of the European border-free zone. We control our own borders.”

The Facts:

The United Kingdom is not part of the border free-zone, known as the Schengen area, and technically does retain control over its borders. This means passports can be checked and papers  verified at Border Control points and entry denied to persons without correct identification. However, this is most certainly not a case of the UK being able to limit the numbers of people coming from within the EU (~500,000,000 population).

The United Kingdom is not allowed to directly control the levels of immigration from other EU countries and saw a surge in migration during 2015, with over one million new EU citizens – 1/500 of the entire population of Europe – settling in Britain during in just one year.

Leaflet quote source: Page 10

8. Benefits

The Quote:

“The Government has negotiated a deal that will make our benefits system less of a draw for EU citizens. In future, new EU migrants will not have full access to certain benefits until they have worked here for up to four years.”

The Facts:

The new deal has not yet come into effect, so it’s not clear how successful it will be and if it will reduce the UK’s welfare bill. It’s also impossible to tell whether or not it will, as the government claims “[be] less of a draw for EU citizens.” There’s no hard proof that the UK benefits system was a major factor for migration, with the University of Oxford’s Migration Observatory claiming job availability as the main attraction.

The prime minister’s deal means that in-work benefits can be restricted to new EU workers for up to four years after they start working, but only if the so-called “emergency brake” has been ‘activated.’ The brake is available to all EU members, but must be approved by the EU before it can be applied, and only if the government can show that an “exceptional magnitude [of migration]” over “an extended period of time” has occurred, causing “excessive pressure” on schools, hospitals, and other public services. It’s doubtful this system will be used, but not out of the question, though seeking permission from the EU to restrict the country’s benefits system is still not a soverign matter.

Leaflet quote source: Page 10

9. The Single Market

The Quote:

“No other country has managed to secure significant access to the Single Market, without having to:

  • follow EU rules over which they have no real say
  • pay into the EU
  • accept EU citizens living and working in their country

The Single Market makes it easier and cheaper for UK companies to sell their products outside the UK, creating jobs as a result.”

The Facts:

Iceland, Liechtenstein, and Norway have total access to the Single Market and none are full members of the European Union. However, they must pay into the EU (Norway paid £300 million (388 million Euros) into the EU last year and will continue pay that figure until 2021), and must accept the free movement of people – Liechtenstein being an exception.

All three must follow EU rules and regulations and are not allowed to vote on matters, however, at least in theory, all reserve the right to not turn new EU laws into national law. Doing so would likely cause political ramifications.

Switzerland has limited access to the Single Market and managed to negotiate this through different treaties and trade deals. It is still required to allow the free movement of people and contributes to the EU budget. It’s worth pointing out that in 2012, 81% of Norway’s exports went to the EU, despite the country not being a member of the EU. In the same year, Switzerland’s EU exported topped 56% of its total. This is far above the United Kingdom’s export level.

It is true that on paper the Single Market does make it “easier” for British companies to export good and services to the EU, but there are limitations. Since a large proportion of regulations are created at an EU-level, specifications for products and services are aligned throughout EU member states. This reduces a lot of ‘red tape’ but also has the potential to introduce additional costs for businesses.

Leaflet quote source: Page 8

10. Investment in the UK

The Quote:

“Being inside the EU also makes it more attractive for companies to invest in the UK, meaning more jobs. Over the last decade, foreign companies have invested £540 billion in the UK, equivalent to £148 million every day.”

The Facts:

The figures stated are correct. According to the Office for National Statistics, companies investing in the UK from around the world invested £540 billion between 2005 and 2014, which works out as £148 million per day. However, this figure has been decreasing year on year since the financial crash nine year ago, with the largest cause being the flailing EU economy.

It’s near-impossible to tell if being in the EU has resulted in the high investment seen, or whether this would have happened had the UK not joined the EEC, with HM Treasury publicly stating this point.

The government uses a survey which found that 72% of investors see access to the Single Market as important factor when choosing whether or not to invest in the United Kingdom. However, the very same survey reports that investors have “very mixed opinions” over the UK leaving the EU, finding that “43% overall say this scenario would not change the UK’s attractiveness, almost one-third (31%) say it would make the UK less attractive, against 22% who think the UK would become more attractive in this situation.”

Going by the government’s own source, it’s reasonable to say that leaving the EU would would make little difference to investment, with 65% of investors seeing no change or finding the UK more attractive to invest in outside of the EU.

Leaflet quote source: Page 4

Conclusion

What should we make of these statements and findings? As the son of a migrant, this is odd territory for me. I’ve always loved Europe but find the European Union’s apparant contempt for the United Kingdom to be corrosive. Indeed, I suspect had the EEC remained in place, this referedum would not be happening. I, like many, prefer facts over simplified government quotes. In my opinion, the government has not managed to provide suitable evidence for staying in the EU when based on the EU leaflet delivered to every household. I am an undecided voter and will continue to form an opinion based on fact.

I also find both sides’ focus on the economy important, but tedious. It appears fear, money, and petty name calling is the 21st Century modus operandi for British politics.

 

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