No Deal, No Steel: Andy McDonald on Brexit.
So, after a few weeks of Boris Johnson of becoming PM and the calamitous noises coming out of the hard right regime in No 10, my worries ever deepen about what the future holds for the UK as the insane No Deal crash out on the 31st October 2019 gets ever nearer. We have to stop that happening and I will explain why.
I’ve made my position clear on Johnson. He’s totally unfit to be PM. He’s totally reckless; he’s a charlatan, a thug and it’s not possible to trust a word he says.
He’s going to mess up big time and I just can’t understand why 90 odd thousand Tory party members think that he’s the man to lead our country.
But putting that to one side: I have absolutely no doubt that the threatened No Deal will be a complete and unmitigated disaster and no amount of brave talk, vim, vigour or self- proclaimed will power will change that one jot.
I want to look at what it means for my part of the world on Teesside:
Of course many people in this area have been justifiably angry with the political elite and vested interests for some considerable time. And with events such as the closure of the Redcar Steel works in 2015, they’ve every right to be angry. That plant could and should have been saved but it wasn’t, and the consequences for thousands and thousands of people have been devastating. But what we are looking at now with No Deal, is of another order altogether.
I’ve heard it said that No Deal means we just carry on as we are. No, No, No. With a No Deal crash out of the EU everything changes and it changes very much for the worse for working people and irreversibly so.
Just consider one of our important industries namely the Chemicals sector.
Teesside is one the big four UK centres, the others being Hull, Runcorn and Grangemouth in Scotland.
The sector contributes £12.1bn to the economy and directly employs 99,000 people across the country. I was talking to local industrialists a few weeks ago and they say very conservatively that there are around 8,000 directly employed in the sector in our own area, but the indirect jobs in the supply chain means that figure can be multiplied by between 5 or even 7. So on any reasonable interpretation; we are talking of around 50,000 jobs in our region alone.
The problem of a No Deal Brexit is that the Chemical and Process sector is dominated by international companies with plants all over the world. They will invest wherever it’s best for their business. Come the 1st November, the best place for them will no longer be the UK.
The thing about the chemical business is that it is highly efficient so there’s no room for further efficiencies to cover the costs of tariffs on goods and materials coming and going out of the country that comes with leaving the EU or indeed other associated expense or delays suffered by way of a crash out of the EU.
Over 50% of the products that the sector produces go to the EU and over 65% of our businesses are exporters, so you get a sense of the enormity of the problem
The tragedy is that if we end up with No Deal, I have no doubt whatsoever that those Chemical and Process industries will up sticks and leave and in all likelihood go to Holland. It won’t happen overnight but in the few short years following such an exit, that is exactly what will happen.
That’s not just a disaster for the local chemical sector, with a loss of thousands of jobs, it’ll be a disaster for all sections of our manufacturing industry that depends on chemicals and the process industry and that includes the automotive and pharmaceutical sectors. So when the Government’s own assessment says there will be a 16% downturn in our economy in the North East as a result of No Deal, its plain to see just where those 100,000 job losses will impact.
The traffic of goods across the channel is a continuous pipeline. If there are any delays and costs put in the way, then it will be impossible to sustain those chemical plants. Tanks of raw materials are kept at optimum levels. If that equilibrium is interrupted and levels get too low, we are then into shut downs in the first instance, and then permanent closures.
This would be cataclysmic. But it doesn’t have to be like that. If we don’t maintain sensible business practices and links with our partners in the EU, then we will be robbed of the fabulous opportunities that come with the Green Industrial Revolution -with all the jobs and prosperity that would follow.
As it is, on Teesside we are in the best position in the country to lead on the Green Industrial Revolution.
As a senior industrialist on Teesside put it to me very recently “if you lose today’s industry you lose tomorrow’s”. That makes complete sense to me as did his comment that “we need a business environment that makes it easier to trade with other countries, not harder”
This is incredibly serious stuff and I can’t stress just how disastrous a No Deal Brexit will be for us.
Boris Johnson, Jacob Rees-Mogg and the rest of the elite are going to be OK no matter what happens, but it’s the working people in places like Teesside who will pay the price with the loss of jobs on a massive scale. The widespread damage to our economy will be catastrophic. A No Deal exit from the EU is utter madness and it has to be stopped.
I don’t want to see the people I represent being unable to pay their mortgages or getting to checkout at the supermarket and their bank card being rejected for lack of funds. That is what it will look like and I would be failing in my duty if I didn’t tell like it is.
The stakes could not be higher.