The EU and the UK - the single market

As part of a series of features on BBC Democracy Live to mark the 40th anniversary of UK membership of the EU, MEPs from across Europe give their thoughts on the costs, benefits and future of one of the key policies of European integration: the single market.

William Dartmouth, UK Independence Party

William Dartmouth MEP The Earl of Darmouth is a member of the parliament's International Trade Committee

The single market is not a free-trade area, but a customs union with a common external tariff. Free trade would be markedly different. There would be no tariff on the import or export of goods.

The main thrust driving the single market - and eliminating internal tariffs - was the 1986 Single European Act. Because of the large differences between member states, after 27 years, the single market is still incomplete in many sectors.

The key point is that the cost of regulation to level the playing field between the different countries far outweighs any benefits from reduced internal trade barriers. The European Commission has estimated that between 1986 and 2002 the single market increased EU GDP by €165bn. But the former Industry Commissioner, Gunter Verheugen, estimated in 2006 that EU legislation cost European business €600bn (£405bn) a year. This is almost twice the previous estimate of €320bn, and represents 5.5% of total EU GDP. It is equivalent to the EU losing the entire output of, for example, the Netherlands every year.

As for the UK, the costs of EU regulation from the single market have been estimated at up to 10% of GDP. Further, just 13% of the UK's GDP is dependent on exports to the EU - and that proportion is going down. The consequence of the single market legislation is that the entire UK economy - that is 100% - is subject to, and handicapped by, job-destroying and growth-toxic EU rules.

The single market does not make economic sense for the UK. The single market is political. It is a critical step along the way of the European Union's goal of political union.

Malcolm Harbour, British Conservative

Malcolm Harbour MEP Malcolm Harbour is chair of the parliament's Internal Market Committee

We have come a long way since the single market programme was launched in 1992. It has generated millions of new jobs, stimulated economic growth, encouraged competition, and expanded consumer choice. In times of sluggish economies, keeping the single market open is vital for creating new growth and jobs. Through its advocacy of a Single Market Act, agreed in 2010, the European Parliament has played a key role in putting the goal of single market completion at the top Europe's growth agenda.

But the single market still has a lot of untapped potential. Much more needs to be done to meet the challenges of global competition, societal change and an information-driven market place. Our tasks now are to gear up to the digital era, and ensure that citizens can shop online in trust and confidence. We need stronger and clearer commitments to complete the digital single market.

We must continue to remove market barriers in goods, and especially services. We must make it easier and cheaper for companies to exploit the large market on their doorstep. We must change the procurement rules to encourage innovative companies to offer solutions to public customers. We must make Europe small-business friendly, and promote entrepreneurs who want take advantage of the world's largest single market.

The anniversary of the 1992 programme must be more than just a nostalgic celebration. It is an opportunity to put new ideas on the table, to highlight continuing barriers and bureaucracy, and to give fresh impetus to new initiatives to reboot the single market into the 21st Century.

Tunne Kelam, Estonian Liberal

Tunne Kelam MEP Tunne Kelam was a leading member of the Estonian independence movement

The single market is the very basis and sense of European integration. In 20 years the intra-European trade has quadrupled, the same is true for the increase of direct foreign investments between EU countries. The new member states which joined the EU since 2004 have especially benefitted from it.

Ironically however, Europe still lacks a true single market. Until recently it seemed almost politically incorrect to speak out about completing the single market, generally words like "deepening" were used.

In reality we are continuously faced with non-implementation by the member states of the already existing EU laws and directives. There are about 150 bottlenecks and gaps which cause serious distortion and fragmentation of the functioning of the European market. Especially disappointing and demoralizing for the new members has been obstinate resistance of several "older" member states to the opening up of their services markets and to the launching of the single digital market.

The continuing incompletion of the single market reflects in a nutshell the major problems and internal contradictions of the EU - the insufficient political will coupled with preference of short term national interests to the common good.

Enhancing the role of the Commission to enforce the law will not solve the problem: two dramatic weaknesses of the EU need to be addressed first. These are alarmingly unequal levels of competitiveness which motivates several member states to protect themselves instead of conducting genuine structural reforms.

And last, but not least, failure to fully understand that in the present demographic situation where there are only two or three taxpayers left for one retired person, the model of the established welfare state is not sustainable. Rapid completion of the single market is the main resource to boost growth

Arlene McCarthy, British Labour

Arlene McCarthy MEP Arlene McCarthy is a vice-chair of the Economic and Monetary Affairs Committee

The single market benefits British business, citizens and consumers. It is a big boost to trade, jobs and growth with around half of our exports, goods and services destined for European markets and generating around 3.5 million jobs. Eight out of the UK's 10 main export markets are in the single market.

Further growth in the services market has the potential to increase UK household income by about 7% and EU GDP by 4% over the next 10 years. Recovery of debts for British business has been facilitated with a new European Payment Order enabling them to avoid costly court fees. Single market laws to control the movement of weapons is helping to tackle gun crime in the UK, by restricting the movement and sale of convertible hand guns.

Consumers have benefitted from an EU-wide law to bring down the cost of mobile phone roaming for texts, calls and data, while enjoying the right to have purchases replaced, repaired or refunded across the EU. Vulnerable and elderly consumers are protected with the single market law on Unfair Commercial Practices to tackle scam merchants and dodgy dealers.

From business exports to buying goods or using a mobile phone in the EU, the single market has advantages for the UK.

Paul Murphy, Irish Socialist

Paul Murphy MEP Paul Murphy is a member of the European Parliament's International Trade Committee

We are currently experiencing a deep crisis in Europe, with savage austerity being applied that is destroying people's lives and pushing the economies back into recession. This is partly the European expression of the crisis of world capitalism that started in the US, but it is also a result of the deep crisis of the process of capitalist integration in Europe - of which the single market was supposedly a crowning achievement.

Although the single market undoubtedly brought benefits to people's everyday lives, such as the ability to travel easily across borders and to work in different countries, it has been primarily a process designed in the interests of big business in Europe.

The free movement of capital by big business has taken precedence over the rights and interests of working class people. This right to free movement of capital enshrined by the single market has been used to drive an agenda of liberalisation and privatisation of vital public services by the EU. The result has been a sell-off of public companies, with the consequent destruction of working conditions and deterioration of services.

Similarly, this free movement of capital has seen massive speculation on countries' debt. Increasingly, we see societies ruled by the 'dictatorship of the market', dependent upon the whims of ultra-rich bondholders.

Twenty years on, we can conclude that the single market has failed for working people across Europe, while it has worked for the rich and big business. With the simultaneous massive movements against austerity across Europe, the power in Europe is clear.

This should be wielded to reject the failed neo-liberal model of a Europe built on a 'single market' for the rich, and instead build a fundamentally different Europe, a socialist Europe based on solidarity and equality.

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