This article was originally published on BrexitCentral
The Brexit dividend can fill the gaping hole in the NHS and stop other public services being raided.
A report by the Institute for Fiscal Studies and The Health Foundation has exposed the need for £95billion of extra funding to maintain current standards for the NHS by 2033/34. Naturally, public debate is based around generating the additional revenue by hiking taxation – with the report suggesting up to an extra £2,000 per household, per year.
The NHS has required constant propping up, with significant amounts of additional revenue over the last decade. Most of the funding has come from sharp cuts in vital public services such as defence, instead of cutting other weighty expenses like our bulging foreign aid budget. This is clearly unsustainable and undesirable.
What analysts are forgetting is a ‘Clean Brexit’ can reduce the burden on hard-up families and our integral public services due to recouping the monumental expenses of our membership of the European Union.
In 2016 a whopping net contribution of £7.6billion (including the rebate and EU expenditure on our public and private sector) of British tax payers’ money was expended as a consequence of our membership of the EU. This would generate £114billion in revenue over 15 years, comfortably exceeding the required £95billion target which has been set.
Even more income for the NHS can be gained after Brexit because lots of the money we currently get back, is not fully under Government control. As a consequence, the Government could direct this funding towards the NHS and other dwindling vital public services.
The Brexit dividend is however dependent on the Government securing the Clean Brexit which the Great British public has twice voted for during the EU Referendum and General Election. This requires leaving, among other things, expensive EU projects such as the Common Agricultural Policy.
Furthermore, immediate boosts to the NHS can be made by scrapping the £10billion per year transition period and leaving with no deal, saving the £40billion ‘divorce fee.’
Obviously, debates can be had about the merits of such measures. Some may argue giving businesses the certainty of the transition period and negotiating preferential access to the Single Market will be financially beneficial for tax payers overall. The important thing however is Brexit allows these avenues to be considered whereas before the Referendum they would never have been an option.
Another reason a Clean Brexit can be vital to the NHS is Britain’s wider prosperity; a richer Britain will naturally generate higher tax revenues. We must be able to sign free trade agreements with the rest of the world – something impossible while we remain a member of the Customs Union.
America, Canada, Australia, New Zealand, Switzerland and many more nations have been incredibly vocal about their genuine intent to sign comprehensive free trade deals with a post-Brexit Britain. Amazing trade opportunities exist outside of the EU, especially considering predictions from the International Monetary Fund over the next 10-15 years that 90% of global economic growth will be from the rest of the world.
In addition, a post-Brexit Britain – free from the constraints of the Customs Union – will no longer be subject to the restrictive and protectionist Common External Tariff, which makes non-EU goods more expensive for British businesses to import. Britain would also be able to be more competitive and flexible as a trading partner than the EU, as our trade deals will not require ratification from 27 Member States with wildly diverging needs.
Ideally of course, a good deal with the EU, one which secures preferential access to the Single Market and recovers vast sums of our money while freeing us from the restrictive rules of the EU, is preferable to better enable us to fund our NHS. However failing this, the Government must be strong enough to walk away if a good deal becomes untenable.
As a consequence, the Brexit dividend and related benefits to our public services, rely on the Government understanding the very strong hand Britain has in negotiations, and being prepared to leave with no deal if the EU will not arrive at a fair one. Ideas like the backstop, and continued membership of the Customs Union and Single Market are not conducive to such a conclusion.
The news of the huge funding gap which will arise in the NHS over the coming future is another reason why after the people voted to get Britain out, a ‘Clean Brexit’ could be more vital than ever.
Joshua King is a Research Executive as grassroots, cross-party campaign, Get Britain Out