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McCluskey on Brexit: Listen to workers’ anguish, don’t...

McCluskey on Brexit: Listen to workers’ anguish, don’t add to it

17 January 2017

Ahead of the prime minister Theresa May’s speech where she will outline her priorities for negotiating the UK’s exit from the European Union, Len McCluskey, general secretary of the biggest union in the UK and Ireland, said: “The prime minister’s announcement today (Tuesday 17 January) looks set to send shock waves around factories and shop-floors across the country. Her determination to appease the hard right in her party and Ukip by talking tough on immigration is putting millions of jobs in jeopardy.

“Mrs May must not put party before country today. Trade unions and others have clearly outlined how real concerns over the freedom of movement can be addressed by sensible labour market safeguards without abandoning the single market when we leave the EU.

“Out of the single market, possibly out of the customs union, then investment in core sectors like car manufacturing, chemicals, aerospace, even food manufacturing, will be threatened as companies face hefty on-costs and serious disruption to their supply chains.

“I urge Mrs May to listen to the anguish of working class communities, not to add to it. Trading with nations that will not uphold our labour standards is not an acceptable solution – that trade will come with a heavy price tag, certain to be paid in the jobs, rights and wages of working people. 

“The prime minister must pay less heed to the Brexit headbangers around the cabinet table and more to the anxiety felt by working people who believe their jobs are being held hostage by the extreme nationalist wing of her government.” 

ENDS

Note to editors:

Unite’s view is that taking the UK out of the single market and the customs union will endanger jobs and the manufacturing base:

  • Hundreds of thousands of UK jobs, skilled jobs in manufacturing, science and aerospace will be threatened
  • These jobs are the backbone of our economy: for every one job in manufacturing, four  are supported elsewhere
  • Manufacturing is also the UK’s best hope of rebalancing the economy away from its dependency on the City of London
  • Out of the customs union, UK industries cannot play their role in integrated supply chains
  • Out of the single market, UK exporters face on-costs for goods which for many will be unmanageable
  • Unite is seriously concerned that companies will be assessing their investment decisions and conclude that a hard Brexit means that committing to a long-term operation in the UK is now unattractive. 
  • In manufacturing if the UK leaves the EU without a trade deal UK exporters could face costs of £5.2 billion in tariffs on goods being sold to the EU by the UK.
  • EU exporters could also face £12.9 billion in tariffs on goods entering the UK.
  • Outside of the single market the default mechanism will be for UK to pay the common external tariff which differs sector by sector.
  • For our world-beating automotive industry this means 10 per cent tariff on exports going to the EU and four per cent on imports coming into the UK. 
  • It is even higher for food manufacturing, which could be as high as 30 per cent.
  • The price of these on–costs is colossal and would have a massive impact on jobs, investment and skills.
  • The uncertainty over where the government is heading could impact on investment agreements.  Companies hurt by the tariff costs will look to cut costs and to invest elsewhere. 
  • Given that the UK exports £220 billion worth of goods and services to the European Union - and the UK trade deficit with the EU stood at £23.9 billion in 2016, The UK’s reliance on exporting to the EU is plain for all to see.
  • The main employers’ associations argue that the UK needs to remain in a tariff free single market. These include the Engineering Employers Federation, the Chemicals Industry Association, Aerospace, Defence and Space, the Ceramics Federation, the UK Petroleum Industries Association and the SMMT - the automotive manufacturers - all agree that remaining in the single market is essential.
  • In the automotive sector – which employs almost 100,000 of our members – the trade body the SMMT have said that out of the single market, the on-cost on a UK made car equates to around £1,500 per car. 
  • Professor David Bailey of Aston University in Birmingham, an expert on the UK automotive industry, points out that automotive supply chain company GKN in Birmingham handles “components from Spain, Italy, and France – their products could have crossed the channel several times before a car is sold.” 
  • Our biggest car factory Nissan values yearly exports to the single market as £2.9 billion per year.  The value of EU exports across the automotive sector this was over £10 billion in 2015; this is 49 per cent of all UK carmakers' exports.
  • In the chemical sector, 60 per cent of chemical industry exports are to the European Union and chemicals are the UK’s largest manufacturing exporter. Unite has thousands of skilled members working in science dependent on the industry being a successful exporter.

For more information please contact Unite senior communications officer Shaun Noble on 020 3371 2060 or 07768 693940. Email: shaun.noble@unitetheunion.org

  • Unite is Britain and Ireland’s largest trade union with over 1.4 million members working across all sectors of the economy. The general secretary is Len McCluskey.