Monday, 9 May 2011

Cost of European Union membership

Almost, it seems, from time immemorial the government of the day, regardless of political colour, has refused to produce a cost/benefit analysis on this question of EU membership - continually stating that the benefits are obvious. Since 2006 Gerard Batten, UKIP MEP, has produced such a cost/benefit analysis, the last one being in 2008 and the latest produced in March this year. These studies by Gerard Batten are normally available on the Bruges Group website but unfortunately, at the time of writing, does not appear; neither does it appear on the UKIP website, which is hardly surprising as their website is fast becoming a joke.

For the benefit of readers I will cut 'n paste Gerard Batten's introductory message and the main findings:
"This is the fourth edition of this study since 2006. The last edition was published in 2008. Since then the situation has grown much worse. The Lisbon Treaty has been ratified, the Westminster political parties having ratted on their manifesto promises and ‘cast iron’ guarantees to hold a referendum. More and more power has been transferred to the EU and the cash contributions and indirect costs have risen inexorably.

It is not possible for me to produce a definitive cost of EU membership and I do not maintain that my findings are definitive, but I believe that they are the best estimate at this time based on the available information. My methodology is simple: to identify the direct and known indirect costs of EU membership and combine them to arrive at a total cost. One thing we can be reasonably sure of is that there are yet more hidden costs that we are not aware of and that the real costs are actually much higher than my deliberately conservative estimates, but I would rather err on the side of caution than be accused of exaggeration. I have only used those figures and estimates which are clearly identifiable and come from respected sources.

A couple more comments on my methodology: in estimating the costs of the Common Agricultural Policy, the Common Fisheries Policy and EU Over Regulation for 2010 I have used the GDP figure for 2009 as this was the latest one available; when referring to Gross costs this includes the UK Rebate and our own money spent in the UK by the EU, and where I use Net this excludes the UK rebate and our own money spent in the UK by the EU.

My position is very clear: if my findings are inaccurate then let the Government commission an  independent cost-benefit analysis and prove me wrong. If Britain benefits from EU membership then let those that advocate it prove it.

In my view membership of the EU is an economic and democratic disaster and that the only solution for Britain is unconditional withdrawal.

Yours sincerely,
Gerard Batten MEP

"Summary of main costs:

The bullet points below highlight the main findings that have emerged from this study. They paint a picture of ever increasing costs of EU membership and an ever increasing trade deficit with EU countries.

• Britain’s contributions to the EU Budget are rising by 33% Gross, and an astonishing 97% Net, for the budget period 2007-2013 compared to 2000-2006.

• For the current Budget period (2007-2013) Britain will have made estimated total contributions of £105.726 billion Gross or £42.026 billion Net (excluding the UK rebate and EU spending in the UK).

• Britain’s annual contribution to the EU Budget for 2010 is estimated at £15.247 billion Gross or £6.883 billion Net.

• From 1973 to 2010 Britain will have made total accumulated contributions to the EU Budget of £257.648 billion Gross or £77.851 billion Net.

• The Common Agricultural Policy costs Britain an estimated £16.7 billion per annum.

• The Common Fisheries Policy costs Britain an estimated minimum of £4.7 billion per annum.

• EU over-regulation on business cost Britain an estimated £48.7 billion per annum.

• From 1973 (the year Britain joined the EU) to 2009 the UK has an accumulated trade deficit with EU member states of over £438 billion.

• The estimated amount lost in fraud from the EU budget each year (£6.3 billion) is about 92% the UK’s current Net contribution (£6.8 billion).

• For 2010 the estimate of the combined annual direct and indirect costs of EU membership will amount to £85.3 billion Gross or £77 billion Net.

This equates to:

Gross                                                           Net
£7.1 billion per month                                 £6.4 billion per month
£1.6 billion per week                                   £1.5 billion per week
£233.7 million per day                                £211 million per day
£9.7 million per hour                                  £8.8 million per hour
£162,291 per minute                                   £146,499 per minute

This is the equivalent for every man, woman and child in Britain of £1,380 Gross or £1,246 Net per annum: or looked another way, the equivalent for every British tax-payer of £2,788 Gross or £2,516 Net per annum.

In this time of economic crisis, Government cut-backs in public spending, financial austerity, fear of job losses and financial hardship for many it is absolute madness to be wasting billions of pounds every year on the ideological project of creating a United States of Europe that no one wants except an out-of-touch political elite. We might as well burn the money on a bonfire!

Update: The complete paper is now available on-line here.

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