Friday, June 3, 2016

Britain In or Out of Europe?

Is Britain better In or Out of the European Union? What is the business effect and will it mean much to Wilson & Scott?

A Highways industry perspective from Stephen Scott, Managing Director of Wilson & Scott Ltd – Roads, Highways and Car Park Line Marking and Anti-skid surfacing for the UK.

I am old enough to remember the previous time we voted on this matter and indeed the original negotiations that took us into the EEC as it was then. The current EU is a different animal to the original concept of an economic free trade zone and the UK has been less than welcoming to some of the developments over that time. I’m quite clear in my mind that the Euro currency has been less than successful for those countries on the fringe and that the UK has been well served by staying out of it.

That said, I also remember the difficulties of working and doing business across Europe when border restrictions meant long waits to cross into each country if you had commercial vehicles or goods. It took us 5 days and a mountain of paperwork to get a truck to Spain once and another 5 days to get it back. We had to lodge a deposit equivalent to its value with both French and Spanish Customs in case we didn’t bring it back and it took several months after its return before we got the money returned. No-one could envisage such problems now and trucks flow reasonably freely around the continent.

I doubt we would return to the bad old days described above if we left the EU but we can’t be certain of what new restrictions would slow down the movement of spares and materials we need for the successful conduct of our business. Wilson & Scott has business relationships with companies across the EU and our success depends on the smooth movement of goods to keep our trucks, machines and material stocks working on a short time scale. Slower movement would mean potential for delays and lost time on contracts which would inevitably cost money.

Wilson & Scott has benefited from the flow of workers across Europe and not just recently. In the 1950’s and 60’s a large part of the workforce were refugees who fled the continent at the end of the Second World War when their homes fell under Soviet control. The recent influx of workers from across Europe has had far less impact than it did 50 years ago and the highways industry has not been adversely affected nor industry wage levels driven down by these newcomers.

We have been involved in the development of European Standards for road marking materials and whilst it has been a long and tortuous struggle we now have a set of standards that are well understood and enable companies to trade across Europe if they want to. This is bringing new products and processes to our industry and improving value for our clients.

The case for controlling our own destiny and borders is well made by those who want us to leave but they are less clear on the consequences to our economic outlook because they don’t really know what will happen and it is that vacuum of knowledge that worries me most. It would be a leap into the unknown and not easily rectified if the wheels fell off. The faults in the current EU structure need changing if we stay in and we’ll need the support of others to do it but at least we know what needs doing.

I believe the Country and our Company would survive an Exit vote but the risks appear greater than a Remain decision. Well run companies (and countries) consider risk factors all the time and need to understand the downside potential before making decisions.

Do we know enough about the downsides as the deadline approaches? I can see what membership of the EU looks like now and probably what it will look like in the near future. I’m not so sure I know what Exit looks like in any time scale.

Do you?

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