Leaving the EU: the View from Green Business

We are delighted to share this guest post from Juliet Davenport, founder and chief executive of Good Energy.

Like all businesses, green businesses need a stable legal framework within which to operate. There is no question that leaving the EU would introduce a lot of regulatory change and legal instability, at least in the short term. We would also be likely to see changes in exchange rates between sterling and the euro, with a decline in the value of the pound making imports for our production processes more expensive. This could lead to an increase in the perceived risk of lending to sterling-based businesses and hence higher cost of finance.

All of these economic effects, combined with new trade tariffs that we may face as a result of leaving the single market, will increase the costs of business and make life more difficult for businesses in the UK. Resilient and adaptable businesses would of course find a way to flourish, but it is important to note that it will probably be harder to find investment in the post-Brexit scenario. Households will experience the indirect consequences of these economic changes. If the cost of doing business goes up, this will be passed on to customers in the form of higher prices. In the energy sector this is likely to mean higher energy bills for electricity, for example, and since we import 60% of our energy from abroad – including 11% of our electricity from Europe – a price hike would be on the cards for businesses and households.

It is undeniable that the quality of the environment in the UK is protected by EU legislation. The EU has a good record of positive action on environmental issues as diverse as the quality of our beaches, climate change, mandatory targets for renewable energy, and clean air. While most of this legislation would continue to be in place immediately after the vote to leave the EU, the tendency to deny the reality of climate change and view environmental protection law as “red tape” does seem more prevalent in the Brexiteer camp. It is also worth making the point that any national government is less likely to pass strong environmental law than a club of nations.

One of the benefits of EU policy is that it can be made with a longer term perspective and is not driven by the five-year domestic electoral cycle. The indirect nature of EU democracy allows politicians and policy-makers to rise above the narrow interests of a political party and work better for the common good of both citizens and the environment. A decision to leave the EU would lead to a protracted period of negotiation over the exit terms and then a period of rewriting British law. This would be followed by the lengthy period of negotiating new bilateral agreements with a large number of countries to allow us to continue to trade. Not only would this undermine our ability to trade in the short term, and risk the loss of export markets, but it would also require an army of civil servants simply to undertake these negotiations. Government departments which have already been cut to the bone would see resources diverted from existing work, such as enforcing environmental law.

Many of the issues that would confront business if we left that EU are common to all businesses. But from the perspective of a green business we are facing particular threats and it seems clear that green businesses would be better supported by remaining part of the EU.

Student Exchange Programme at Risk

Across Europe young people are campaigning to draw attention to the benefits they have received from the Erasmus+ programme. Like many of the twinning and exchange activities that have helped to cement peace in Europe, as well as providing life-changing experiences for young people, Erasmus+ is under threat is the UK votes to leave the EU on 23rd June.

According to the campaign group Students for Europe, ‘ choosing to leave the EU at the June 23 referendum would threaten the academic futures and employment opportunities of an entire generation of students’.  To defend these advantages that the EU brings students will be demonstrating across the country.

Charlotte Martin speaks on behalf of Students for Europe and said:

“Coming from a predominantly working-class background, the Erasmus+ programme offered me an opportunity I would never have thought possible. As a British student I started learning a new language, and saw the wealth of job opportunities there are in Europe.

Leaving the EU risks the fantastic freedom of movement – to study, work and travel – that myself and others have today. In Nottingham we’ll be talking to students about why it’s so important to register to vote for the EU referendum.”

The Erasmus+ programme allows more than 10,000 British students to study abroad every year and since it was started more than 200,000 British students have been able to spend time at another European University, learning about other cultures and expanding their horizons. This programme is not just about travel and adventure but is vital in building the relationships that underpin peace in our continent.

Research for Universities UK indicates that the programme also brings economic benefits to individual students. Those who have completed an Erasmus placement have been shown to be 50% less likely to experience long-term unemployment.

UK influence within the EU dissected

Last week Vote Watch, an international NGO that tracks the votes of MEPs, released this special report looking at the effect the UK has had on EU legislation. The report looks at the two bodies responsible for amending and passing legislation from the European Commission – the Council of the EU, where we send UK ministers, and the European Parliament, where we send our 73 MEPs. So does their report vindicate the Leave camp’s claims that we have no influence?

One of the first things of note from their analysis is the big increase in cases of conflict in the Council when comparing the 2004-2009 period and the 2009-2015 period, i.e. when we started sending Tories, we started voting against or abstaining a lot more against EU wide interests, particularly on budgetary policies, foreign and security policy, and international development. This means that we went from being on the losing side 2.6% of the time during 04-09 to 12.3% during 09-15. Obviously on the flip side, this also shows that we were still voting and winning in almost 9/10 cases!

For those still complaining we have little influence, take note – with 22 MEPs, UKIP are our largest delegation in the Parliament. The report shows that UKIP MEPs’ capacity to exert influence in the European Parliament is significantly diminished by their very low participation rate in EP votes: in the first year of the current term, UKIP’s delegation has had a record low participation rate of just 62.3% in plenary votes, which places it at the very bottom among all national party delegations in the EU. Meanwhile, Greens/EFA MEPs have a much higher turnout, and have won (voted with the winning side) in 64% of votes since 2004.

And so onto positions of relative power in the Parliament. In short, UK MEPs have captured many agenda-setting positions. We have had Vice-Presidents, political group leaders, and Chairs of important committees. UK MEPs have also won rapporteurships (lead negotiator position) on key legislation, which has enabled them to shape EU law. Moreover, UK MEPs have not been ‘underrepresented’ relative to the MEPs from the other big member states. All of this has been possible despite the growing number of UKIP MEPs, who, along with their poor attendance have not competed for many key offices or rapporteurships.

The end of the report summarises with some of the main political influence that the UK has had. From a Green perspective it paints a mixed picture, with the UK driving support for nuclear and unconventional energies like fracking, and hampering action on tax avoidance, but also contributing significantly to the EU budget and enhancing copyright laws.

So there you have it then – the UK has plenty of influence, but if the people we send just aren’t up to the job, then you can’t expect to return a positive change for citizens across Europe.

EU Funded Projects in the South West

Earlier this week, we looked at EU funding to the most deprived areas of the South West. What about EU funding and the other end of the spectrum?

Horizon 2020 is the EU Research and Innovation programme for 2014 – 2020 following on from the FP7 programme. In the South West, Bristol and Swindon are amongst the largest UK recipients of Horizon 2020 research grants currently allocated, both at around €60 million so far for this period.

During the FP7 period (2007-2013) Bristol University received a whopping €142,263,470 in research funding, making it the 8th highest recipient of EU research funding in the UK higher education sector! Across the West Country, a total of 1,155 proposals were retained for funding (25.4% of total applicants from the region) involving 1,310 successful applicants and requesting €393,95m of EC financial contribution. This made the South West the 7th most successful individual region of all those in the EU 28 member states for research grant applications. The region received just under €600 million during the FP7 period, with a further €44 million to SMEs during that time too!

RNLI

There are great examples of  EU-funded projects right across our region. For example a North Dorset based company was awarded funds under the LIFE programme to develop an environment-friendly repair system for leaking sewage and rainwater/surface drainage pipes, while Dorset County Council received funding for a collaborative project focused on coastal zone management and the development of a strategy for an open coast. Poole-based charity the RNLI received funding to develop a system for decommissioning lifeboats and reducing carbon footprint of the organisation.

In Devon, there have been a whole series of funded projects. For example, Exeter City Council received a grant to undertake a housing refurbishment for a number of hard-to-treat, unoccupied properties in poor structural condition. The funding improved the energy efficiency, reducing the predicted annual energy costs by over £500 and saving over 3 tons of CO2/year per property.

Another great EU-funded project is based on the University of Exeter’s Penryn Campus near Falmouth. The Environment and Sustainability Institute (ESI) is a £30 million interdisciplinary centre leading cutting-edge research into solutions to problems of environmental change.

And in Bristol, the National Composite Centre (NCC), based at Bristol and Bath Science Park, was developed with ERDF funding of £9 million to put the UK at the forefront of composites technology. The NCC is a purpose-built research and development facility which brings together dynamic companies and academics to develop technologies supporting the design and rapid manufacture of composite products. Advanced composites are lightweight, high-performance materials which are transforming the design and manufacture of products – from those used in the aerospace and automotive industries, to marine and renewable technologies. By reducing the weight of products, there can be significant reductions in carbon emissions and manufacturing costs, offering huge commercial opportunities and technological advantages.Not only is this ERDF investment expected to generate over 150 additional jobs, but the South West is now seen as a leader in this field, and the NCC is being expanded to attract ideas and research that will result in new products, businesses and jobs.

EU Funds

Here in the South West we are so often leading the way towards a more sustainable future, despite the challenges, and we must continue to make best use of the opportunity that EU Funding Programmes represent to our region.

In the European Parliament, the Greens/European Free Alliance MEPs group have produced this helpful guide to accessing EU funding opportunities, which we would encourage businesses and other organisations across the South West to read and share. With the current government hell bent on cutting spending, there’s no guarantee these streams will be replaced in the event we leave the EU or what their priorities might be.

You can find a comprehensive breakdown of EU funds to the South West on our Resources page.

South West Leads the Way Thanks to EU Funding

Last week, we went to see EU funds in action through a visit The Genesis Centre at Somerset College for a tour of their facility.

For anyone who is not familiar with the centre, Genesis is a £2.5m sustainable construction resource and learning centre for the South West; an idea which originally grew out of a student project. The centre demonstrates that traditional construction methods can work hand in hand with recycled materials and innovative technologies to create contemporary buildings that are more energy and water-efficient, create less waste, and

Genesis

perform to a high standard for the comfort of building users.

The centre houses a range of renewable energy systems which are used for demonstrations and training purposes, ensuring students and construction industry professionals receive hands on experience of working with low carbon technologies.

The centre was funded by the South West Regional Development Agency and the Learning & Skills Council, with funds from the European Regional Development Fund, and is one of many examples of forward-thinking projects that have benefitted from EU funding across the South West.

The South West has in fact been a major beneficiary of EU Funding, with Cornwall most notably receiving significant sums of money from various EU programmes.

Cornwall has received over €450 million in Regional Development funds along with nearly €140 million from the Social Fund. In cash terms, EU membership is worth over half a billion euros in funding to the most deprived county in our region.

For example, just over £7.5 million of ERDF has supported two key projects – the Pendennis Building & Redevelopment of the Yacht Basin. The extensive redevelopment of the Pendennis Building has seen the previous shore-side facility almost completely rebuilt, replaced by larger modernised construction halls, workshops and office space.

Pendennis has become one of Cornwall’s most important employers, thanks to EU Funding they significantly improved the facilities and 315 existing jobs have been safeguarded, with 60 permanent skilled jobs created to date in the Falmouth Docks area. This work builds on the historic maritime tradition of the town and has helped to deliver the Port of Falmouth masterplan.

Genesis 2
The European Social Fund (ESF) Raising Aspirations project (RAP) also helps low-skilled people and particularly women, develop their careers through learning and training. Plymouth University runs the project with partners, including Cornwall College. For example, at the Royal Cornwall Hospital Trust, 22 lower-paid employees successfully completed a higher education module through Cornwall College.

It is fair to say that many of our partners in the EU are more sympathetic to the needs of rural areas than our government is, hence these supportive funding schemes. It is highly unlikely that such funding would continue if decisions were made at Westminster, leaving communities in the West Country vulnerable.

UK Environment Protected by EU Membership

Yesterday the Economic and Social Research Council (ESRC) published this report on the EU referendum and the UK,  covering policy areas regarding environment – a whopping 14 chapters, by as many experts from across the UK and further afield. The report looks at the impact of 3 scenarios – a vote to remain, a vote to leave and become a member of the European Economic Area (EEA) like Norway, or a vote to leave and negotiate individual free trade deals with the EU. So what did they find?

Environmental protection is a field in which EU cooperation is a defining strength, and with such legislation we as a united continent have taken the lead globally. The experts found that the EU has helped modernise our national policies to become focussed on preventing degradation, with clear standards and deadlines and a commitment to sustainability. They also found, far from Brexiteers claims that we have no influence, that the UK has played a role in moulding EU policy – namely preventing common policy on fracking and soil protection! The report also summarises that “there has been no significant long term convergence towards an environmental superstate in Brussels.”

On Climate Change it paints a better picture of us, with the UK playing a part in advocating ambitious emission reduction targets at the EU level, and shaping the internal energy market. It also shows that the EU has been a driver of our booming renewables sector despite the UK maintaining the right to determine its own energy mix, as demonstrated by the Chancellor recently pulling the rug out from under the sector’s feet. In signing up to the EU 2020 targets for greenhouse gas reductions and increasing the share of renewable energy, the UK was pressured into adopting an overhaul that saw attractive subsidies and industrial incentives alongside a new planning regime.

On Agriculture, it is critical of the impact of the Common Agricultural Policy (CAP) on the environment, but highlights that in the global context, any likely national agricultural policy pursued from outside the EU would have been along similar lines with similar effects. In the European Parliament, Greens have been leading the drive for a revolutionised CAP that puts environmental stewardship high on the agenda across the bloc, including capping payments to the largest industrial farms and promoting crop rotation.

Aside from the facts about what the EU has provided, an alarming prediction of the report in the event of us leaving is that, in the ‘Norwegian’ scenario, EU environmental rules covering bathing water, habitats and birds, and some aspects of climate legislation would cease to apply. There was recent public outcry over a proposal to water down the EU habitats directives, but a vote to leave could see us losing them altogether. The report also concludes that the CAP and the Common Fisheries Policy (CFP) would cease to apply, which is obviously a very important consideration, given the size of our rural economy in the South West.

The report is extensive including fisheries, planning, international policy and more, and overall reaffirms the stance that many environmental NGOs have been taking since the announcement for the 23rd June referendum – that the EU sets the bar high for protecting and enhancing our environment and, in the face of a government hell bent on deregulation, there could be grim consequences in a future outside of it.

 

The Economic and Social Research Council is a leading Research Council in the UK, focussing on economic and social concerns. You can find an easy to read executive summary of the report here.

Brexit and the Panama Papers

The two biggest news stories of the week are the government’s decision to spend public money on lobbying for its pro-EU position in the referendum and the revelations from Panamanian legal company Mossack Fonseca about the nefarious tax affairs of the global elite – the Panama Papers. So would the secrecy of the rich and powerful be better protected in or out of the EU?

The overseas territories and Crown dependencies that lie at the heart of the global network of tax avoidance and money laundering are a particular British problem. Most countries have seen their former colonial possessions become independent, or allow them a status as part of their own territory. Only the UK and Netherlands have offshore territories that exist in a legal limboland that facilitates dubious economic activity. Consequently there is little sympathy amongst other EU countries for protecting these post colonial anachronisms.

Although it is right that the Prime Minister has been vilified for his refusal to be open with the electorate, in fact what matters politically is whether his family’s use of secrecy jurisdictions has influenced his decisions on the policy which should be taken in the interests of the country. This week’s reports that David Cameron ‘argued to water down transparency rules over trusts’ suggest that there is conflict of interest that will not be resolved by the Prime Minister publishing his tax return.

Cameron is part of a tiny class of the super-wealthy who disdain the little people who willingly (or unwillingly) pay their taxes but do not have the resources to avoid them. This is why evidence that Cameron intervened to water down the effect of EU transparency rules on trusts is so damaging.

This week a letter to then European Council president Herman van Rompuy was leaked: it indicates that Cameron intervened personally to ensure that trusts like the one he had benefited from that was registered through legal company Mossack Fonseca, should be treated differently to companies in anti-money laundering rules.

In response to this my good friend and colleague Judith Sargentini, Green MEP for the Netherlands who was lead negotiator for the Parliament on the money laundering directive, made clear that she was aware of the UK blocking greater transparency over money laundering and that she had personally warned that it could create a loophole for tax dodgers.

The leaked van Rumpoy letter proves two things. First, that this government’s claims to be leading on tackling tax avoidance are entirely hypocritical. And second, that given the history of both the U.K.’s financial sector and this government’s leading figures, if we are looking for genuine solutions to the obscene behaviour of global elites we would be better off looking to Brussels then Westminster.

 

You may like to sign our petition to David Cameron on Panama Papers.