EU Regulation Has Cost 10% of UK GDP, or Enough to Abolish Income Tax for a Year
European Union regulation has cost the UK economy ten percent of its Gross Domestic Product, or £148.2 billion – enough to abolish all income tax for a year or cut the national debt by 24 percent.
These shocking figures are contained in a new report on the costs of EU regulation issued by the respected think tank Open Europe, entitled “Out of Control.”
The study found that 72 percent of the cost of regulation in the UK stems from EU legislation – in other words, EU regulations introduced in the past ten years have cost the UK economy almost £107 billion.
The cost of EU legislation has gone up year-on-year over the past decade. In 2008 alone, EU legislation dating from 1998 cost the UK economy £18.5 billion — up from £12.2 billion in 2005.
Open Europe is a London based think tank which was set up by UK business people to campaign for reform in the European Union. Amongst its prominent supporters are Lord Leach of Fairford (who is Open Europe’s chairman); Derek Scott (deputy chairman) who was economics advisor to Tony Blair and is currently a visiting professor at London’s Cass Business School; Michael Spencer, founder and Chief Executive of Icap, the world’s largest interdealer broker; and Simon Wolfson, Chief Executive of Next.
The 71-page report measured a decade of the cost of EU regulation since the British government introduced a system of regulatory “Impact Assessments” in an effort to get a grip on the flow of new regulations.
Using information derived from over 2,000 of these Impact Assessments, Open Europe reached its conclusions:
- Over the past decade, the number of laws produced in both Whitehall and Brussels has skyrocketed. The number of legal acts in force in the EU has gone from 10,800 in 1998, to over 26,500 in 2008.
- However, while the number of regulations adopted each year is a useful indicator of trends, a far more meaningful assessment of the burden of regulation is the relative cost of those regulations to the economy.
- Since the UK launched its ‘Regulatory Reform Agenda’ in 2005, the annual cost of regulation has gone from £16.5 billion in 2005 to £28.7 billion in 2008 — an enormous increase of 74 percent.
Meanwhile, the estimated cumulative cost of regulations introduced in the UK between 1998 and 2008 is £148.2 billion. This is the equivalent of 10 percent of GDP.
- For the same amount, the UK Government could abolish income tax for one year or cut the national debt by 24 percent.
EU legislation is responsible for 72 percent of the cost of regulations in the UK
- Of the cumulative cost of regulations introduced over the past decade, £106.6 billion, or 71.9 percent, had its origin in the EU. Similarly, the EU proportion of the average annual cost of regulations is 71.6 percent.
Overall, the cost of EU legislation has gone up steadily year-on-year over the past decade. In 2008 alone, EU legislation dating from 1998 cost the UK economy £18.5 billion — up from £12.2 billion in 2005.
- Taking the cumulative cost estimates, EU legislation since 1998 has cost the UK 23 percent more than the UK’s total gross contributions to the EU budget over the period 1998-2008.
- At the current rate, EU legislation will cost the UK £356 billion by 2018.
- If the current flow of regulation continues, by 2018, the cost of EU legislation introduced since 1998 will have risen to more than £356 billion.
This is around £14,300 per British household. For the same amount, the UK Government could pay off almost 60 percent of the national debt, or abolish income tax for two years and still leave the Treasury with a surplus.
- EU labour market laws account for 21 percent of the total cost of UK regulations. Labour market legislation introduced over the past ten years has cost the UK economy £45 billion, of which 69 percent — £31 billion — came from the EU. This means that 21 percent of the overall cost of new regulations introduced in the UK between 1998 and 2008 can be sourced to the EU’s labour market laws alone. For this amount, the UK Government could cut corporation tax by two-thirds.
- Meanwhile, EU health and safety legislation coming into force in the last decade has cost the UK £5.7 billion.
- EU agricultural regulations have cost British farmers over £2 billion, and the EU food labelling requirements have cost the UK £1.7 billion over the last ten years.
The entire report can be downloaded here in PDF format.
Only the British National Party is unequivocally opposed to Britain’s continued membership of the EU, and is the only party completely committed to withdrawing from this bloodsucking scam.
The time has come for change – the time has come for the BNP.
