12 May 2013

Senior Tories say they would vote to leave EU

As Michael Gove and Phillip Hammond say they would vote to leave the EU, the former head of UK Trade and Investment tells Channel 4 News that political wrangling is deterring overseas investors.

Education Secretary Michael Gove has raised the stakes in the Conservative debate on Europe, saying he’d vote to leave the EU if there were a referendum today – a line echoed tonight by his Cabinet colleague, Philip Hammond.

But they said they backed David Cameron’s attempts to reform Britain’s relationship with the EU first, by giving the UK back more powers.

And Mr Gove stopped short of joining Tory rebels, saying he’ll back the prime minister’s call to abstain in a key Commons vote on Wednesday. The amendment by rebel Conservative MPs will demand that an EU referendum pledge is enshrined in law and criticises the Queen’s speech for failing to contain a bill allowing for an in/out choice.

The prime minister has promised an EU referendum in 2017, but some Tory backbenchers want the pledge to be put into legislation before the next election.

But Sir Andrew Cahn (pictured below) who left his previous post as head of UK Trade and Investment in January 2011 told Channel 4 News that the political wrangling is “unhelpful for inward investment” to the UK.

“Foreign countries wondering where in Europe they want to put their factory or their research laboratory or their regional headquarters look for a whole bunch of things,” he said.

“They look for stability, they look for openness, they look for government welcome – somethimes they look for financial assistance, but what they look for most of all is stability and confidence for the future.”

Sir Andrew Cahn

Gove to abstain from vote

Speaking on the BBC’s Andrew Marr show, Education Secretary Michael Gove revealed he would abstain from the Commons vote on an EU referendum next week.

“Although we absolutely need to have a referendum in the future, it’s not appropriate at this stage,” he said.

He added that were a referendum to take place now he would vote to leave the EU saying: “The current situation is no good and life outside (the EU) would be perfectly tolerable.”

Defence Secretary Phillip Hammond later told the BBC: “If the choice is between a European Union written exactly as it is today and not being a part of that then I have to say that I’m on the side of the argument that Michael Gove has put forward,”

Sir Andrew Cahn added: “The trouble about this continuing drip-drip debate – should Britain be in, should we be out of the European Union is that foreign investors say “we just don’t know what’s going to happen, so we’re less keen to invest in Britain.

“The mood has indeed hardened about membership of the EU – personally, I regret that I think that it would be a grave mistake for us to leave, but I do recognise that the issue has become more sharp, more acute and that makes it more dangerous for trade and investment relationships, because overseas investors can see that hardening and they worry more about it.”