Phil Bennion belongs to the Liberal Democrats Party. He is a specialist in agricultural and economic policy, both on EU level and globally. He took over as Liberal Democrat Euro MP for the West Midlands Region in March 2012 and serves on the Employment Committee and Transport Committee in the European Parliament. Phil has a degree in agriculture and agronomy and a second degree in history and economic history. Besides that he is still running his family farm.
How do national governments affect the EU policy implementation?
Most of the policies are implemented by national governments who have their own take on them. There has always been a strong national aspect to developing EU policies. This is the way Europe works and we have to accept that. For example France is trying to move towards more market intervention in the CAP (Common Agricultural Policy) while we (the UK) have tried to push it in a more market-oriented manner. The EU has taken one step forward by establishing the common currency area with related policies for those countries that wish to join, and one step backwards by trying to strengthen market intervention again. The middle-sized economies often form a bloc to try to prevent the opening of the market within transport or other areas. The forces of nationalism and conservatism are always trying to block progress, we have to expect it and work against it.
Is the EU social policy catching up with the economic development?
The EU should focus more on economic development. The member states should largely be responsible for their social policies, though the EU can encourage the exchange of best practice. The UK has been misunderstood in terms of being very ‘transatlantic’ and not very supportive of social policies when in fact we have very good standards of social protection. If the EU implements too high a minimum level of social standards, several countries will not be able to afford it.
Should the EU invest more into social and employment policies ?
I do not think these are the best areas to invest in. Only if they are skills related. I think most social policies should be delivered and paid for by the member states. We want more flexibility in areas of the budget which can boost employment and economic growth (such as improving transport, IT and power networks). That is not the same as the EU investing directly in job creation schemes as such.
How is the free movement of labour affecting different national economies ?
Our experience in the UK shows that the immigration has led some people to settle, some to become almost native within the UK, but a lot of workers have also chosen to return home. On the whole this movement is positive. There is a massive problem with unemployment. The free movement should not be viewed as a populistic zero-sum game. But there is an issue in poorer countries where people leave and do not come back.
Would the richer member states be willing to give more funds through fiscal transfer in order to increase the minimum wage of poorer member states?
I do not think there will be any will to support these policies through fiscal transfers. The fiscal transfers which do exist are for regional development and social fund. They will continue. Some people believe that more fiscal transfers are needed within the eurozone. I am less convinced of that argument. Any increase of fiscal transfers will be modest because the EU budget is very modest. The areas with lower wages will have a competitive advantage when exporting to the common single market. That in time will help to even out economic success across the EU. However the key drivers of economic success will still depend on domestic policies. That explains the poor recent economic performances of Spain and some other countries.
Are the EU production standards increasing the gap between the rich and poor member states?
As people get richer and more educated, they expect higher standards. I do not see a problem with that. We have a large market space to produce to the EU standards. The poorer member states have to respond to the challenge. Largely these standards lead towards better average pay and working conditions. There is a danger that more expensive production costs will create less jobs, but it should pay off in the long run. EU partners such as Bangladesh are interested in increasing their production standards ie after the Rana Plaza disaster, which killed 1100 people. I also have personally defended the Bangladesh workers in the ship-breaking business. The people are working in very dangerous conditions, risking their lives every day. In my opinion the UK should not co-operate with such business unless its working conditions have been brought up to the internationally expected level.
The EU unified production standards have increased the incoming investment. What are the positive and negative consequences?
In terms of EU unified product rules, I think it is a benefit. I don’t think necessarily that in methodology it is a benefit. Having common rules is what constitutes and ensures a safe and marketable product. Everybody can produce for the same market space. There is no extra paperwork. This side of the single market is good. The fine details of how you operate your business or produce your product give no significant benefit if they are unduly controlled or unified. Controlling the process can stifle innovation. There is no one way of doing things which the EU should decree. Overall, general inward investment within the EU single market has increased a lot. It does attract inward investment and cross-border investment within the EU.
How do you see some member states opting out from certain EU directives?
The main opt outs the UK has been looking for are in the areas of home and justice affairs and social policy, such as the Working Time Directive. I cannot see any compelling reason why the UK should not opt out from EU social policy directives. Some of the directives are not good policies. The local governments can get things wrong. The EU should reverse policies that have not been implemented in a productive way.
Is the rising populism during economic crisis the reason why national governments seek more opt outs on certain EU directives?
Yes. It can be counter productive. This is the core of populist politics.
Why are eurosceptics saying that the UK pays too much into the EU budget ?
Transfers from richer nations go to the poorer nations. We know this. We also get a low drawdown from the CAP because the UK is more urbanized than many other member states. Therefore we get a rebate, about 1 billion euros. It is decreasing over time. The inconsistent change of policies also complicates funding from the EU level. The last Labour government set up regional development agencies who knew how to apply for funding on the EU level. The current government abolished them as part of a drive to save money after the financial crisis. I was against that move. Now the bodies that knew how to apply for the EU funding are gone. There is no one organisation or structure that is responsible for getting the EU funding. The rural development programmes have not been very successful as well. The Treasury forgets that the EU provides about 30% of the funding and merely underlines the 70% the Treasury has to pay. As a result we in Britain have failed to get the EU funding we could have. The Eurosceptics’ narrow view of fiscal transfers ignores the wider social and economic benefits of the EU, which are vast, and gives a misleading impression of the size of the EU budget, which compared with national budgets remains very small.
Is it true that the immigrants are getting more out of the UK welfare scheme than they are paying in?
I know it is not true. The new research findings have a key discovery that the migrant population is actually running a budget surplus in terms of the cost to the Treasury. The migrants are paying more in taxes than they are taking in benefits and services. That is the overall picture. There are still some areas where benefits are being exploited in the wrong manner. The UK has a strong welfare system for people who have lost their job for a short term period, to support them while they look for another. The key reason why many immigrants come to the UK is not to exploit the welfare system, but to work here.
Are the immigrants pulling down the general working standards?
There may be a grain of truth in what is largely a myth. The minimum wage legislation was created to counter exploitation. It does not always work but was clearly necessary. Any problems are largely a matter of implementation.
The UK has an opt out on the EU working time directive. Is the right to work overtime a justified policy?
The right to work overtime is a positive economic effect and a matter of individual rights. The ability to work longer hours if required does help Britain retain more jobs. The 2008 financial crisis had a worse effect on countries with high dependence on the financial services sector. The UK had a bigger hit than many other countries. Now the UK unemployment rate is decreasing. This is one result of having a flexible labour market (compared to many other EU member states) which has allowed the UK to come out of the recession quicker. The effect of immigration is also helping to grow our economy.
How could the employment of young people across the EU be improved?
Previous UK governments allowed apprenticeship support here to fall out of the system. The Lib Dems have pressed the coalition government to learn from Germany and re-implement the support needed to promote and expand apprenticeships. We subsidise the pay of young people for six months in the companies that take them on as apprentices. We are also looking at vocational training. This is what a lot of other European states should also do and the EU can encourage this process. The excessive job protection of incompetent or unnecessary workers is a problem in Spain and Italy. The right balance needs to be struck. In economic terms a more liberal labour market succeeds over a stricter one.
The EU is looking to give more financial support to small and medium size enterprises. How?
The next framework proposes to offer more subsidized loans. The EU Horizon 2020 programme is more focused on making funds available. The problem is that big corporations and trade unions suck in the smaller businesses. We need smaller and medium size businesses to thrive. Many new jobs come from new smaller and micro enterprises. The national protectionist trend will always remain a problem in this area. It is a continued challenge.
What are the overall and indirect benefits the UK gains from EU membership?
The vast economic and political benefits outweigh the costs. The UK’s political importance and leverage is globally far greater because of our EU membership. We just have to convince the UK of that. Opinion is turning. Businesses are now beginning to speak out on the huge benefits we gain from being in the world’s largest single market – millions of jobs depend on us being inside rather than out. People forget that tariff barriers on our exports could make life very difficult if we left the EU.
What are the policies you are personally strongly supporting?
As a Liberal Democrat and personally, I am committed to seeing the EU prioritise projects to help small businesses thrive and to improve infrastructure – and in that way boost our economy and jobs. I would like to see more effort to help young people in apprenticeships and in business. On the environment, I want to pursue decarbonizing the economy more vigorously, we cannot close our eyes to climate change. I prefer economic policies that do not distort markets unnecesarily. I support science and fact based policies and innovation. I am a scientist. It bothers me if politicians make unscientific decisions. Some mistakes repeat themselves time and time again.
I should also point out that on the issues regarding the CAP (farming) and some renewable energies, I have a commercial interest. Where that is the case I take part in the debate, but abstain from voting.
BY: Tuuli Riit