Imagine the UK economy suddenly becoming £180 billion richer every single year – not as a one‑off sugar rush, but as a permanent, compounding uplift. That is what rejoining the European Union could mean: a structural transformation that boosts national income, raises living standards, strengthens public finances and restores Britain’s economic confidence. It would mark a deliberate, strategic shift away from managed decline and towards a confident, outward‑looking economic future.
An economy on turbo
Britain’s economy today is worth around £2.7 trillion. Add £180 billion more in real GDP each year and you get a 6–7 per cent permanent uplift – a lasting improvement that compounds over time. These step changes happen when countries remove trade barriers and integrate fully into large markets, allowing businesses to plan, hire and invest with far greater certainty.
Rejoining the EU would cut through customs red tape, restore full access to the single market and send a clear signal that Britain is open for business again. The Office for Budget Responsibility’s analysis of fiscal multipliers shows that deeper trade integration raises GDP permanently. Over a decade, the result is not just recovery but renewal – a richer, more stable UK economy with stronger foundations and better prospects in every region.
More revenue without raising tax
A stronger economy means higher revenues without increasing tax rates. Britain currently collects about 27 to 28 per cent of GDP in taxes, mainly through income tax, national insurance, VAT and corporation tax. As GDP grows, revenues rise automatically through higher wages and profits, rather than through stealth tax raids or emergency fiscal events.
With an average tax yield of roughly 30 per cent on additional GDP, an extra £180 billion of output would generate about £54 billion in additional annual revenue – or around £540 billion over a decade. That could repair public finances, lower borrowing and provide the fiscal space to invest properly in public services. The OBR’s income tax forecasts show clearly how higher growth translates straight into stronger revenues and more room for long‑term decision‑making.
Families, not just figures
This isn’t just about statistics. About 60 per cent of GDP goes to labour – the wages and pensions of ordinary people – while 40 per cent goes to capital in the form of profits and investment income. That means roughly £108 billion more each year for workers and pensioners, and £72 billion more for employers, savers and investors.
For households, that could mean thousands of pounds in additional real income over time, coming through higher wages, more secure employment and stronger pensions. It is not growth for growth’s sake, but a pathway to broad‑based prosperity that helps families move from just coping to getting ahead. For younger people in particular, it holds out the promise of stable careers, affordable housing and a future in which hard work is properly rewarded.
Wealth, stability and a fairer future
Britain remains a wealthy country – household wealth now totals about 630 per cent of annual national income – but that wealth is unevenly distributed and overly concentrated in property. Rejoining the EU would help rebalance the economy by stimulating productive investment in businesses, infrastructure and green technology, spreading opportunity more evenly across the country.
If the £180 billion uplift compounds over the decade, total household wealth could rise by an additional £1 trillion to £1.2 trillion, particularly through pension funds and business assets. That is not a windfall but a return on confidence – the outcome of participating in a high‑growth, high‑trust European marketplace in which Britain is once again a rule‑maker, not just a rule‑taker.
A Liberal Democrat story for our time
Rejoining the EU is not about looking backwards. It is a forward‑facing economic strategy consistent with Liberal Democrat values – openness, fairness and evidence‑based optimism. A permanent £180 billion‑per‑year uplift would mean stronger families, healthier public finances and a more secure nation – achieved without raising taxes.
This is the story the Liberal Democrats should be telling: prosperity through partnership, optimism built on evidence, and growth shared across all parts of the United Kingdom. It is a story of practical hope, grounded in realism, that offers people something better than the politics of fear and managed decline.
Coming in Part Two: What £1.2 Trillion Really Means for the People of Britain
* Gareth McAleer is a Liberal Democrat member in Didcot and Wantage, and is active in the Liberal Democrat European Group.
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29 Comments
I voted to remain, but not with any real enthusiasm, if I’m honest. Speaking to Brexit voters, many of whom have seen their local industries go to the wall, only to be replaced with low-pay, low-skill, insecure work—if they were lucky—all the while when we were members of the EU. It was difficult to argue the case for voting to remain for a better standard of living, etc., when it’s plainly obvious that communities were struggling. As for the figures outlined in this piece, what makes me skeptical is that the economies in France and Germany are not in the midst of a bonanza; it’s quite the opposite. A 6-7 % uplift in the economy is difficult to take seriously looking out across the EU.
You make a good case for rejoining then EU. I assume that these arguments would be the basis of seeking to win a referendum on the issue.
But, as someone who voted Remain in 2016, I would view any attempt to seek to rejoin the EU without a referendum as an absolute outrage.
Voters already view the quality and credibility of today’s politicians, as easily discoverable by simply kicking over any damp rock, and when Henry the VIII who is long dead can overturn the promised, “ once in a generation democratic vote ”, then voter cynicism is plain to see why
“Imagine the UK economy suddenly becoming £180 billion richer every single year”:
What is the evidence for this claim? Over what time period would it occur? What are the costs that would be incurred? How do non financial issues, such as legitimate concerns over freedom of movement addressed.
Simply citing un-evidenced benefits didn’t work 10 years ago and won’t help now.
@Andrew Tampion
A bit of a google for “£180 billion for rejoining EU” (because I had the exact same thought!) doesn’t turn up much. An instagram post from Bloomberg is the best I can see citing ‘government research’ But that is what the UK has lost *since* Brexit. Not what it would gain from rejoining.
I can find a reference to a post dated 4 months ago by Layla Moran saying Brexit cost the UK £90 billion a year (on facebook which I don’t have so I can’t investigate further) which makes me think this is a best a highly contentious claim.
And to be honest if you make a massive claim without any attempt to cite references you deserve to be ignored.
Chloe, you’ve got it back to front. If France and German were not in the EU they would be 6-7% WORSE off than they are now.
The EU were not to blame for the collapse of British Industry, Margaret Thatcher’s government was. The EU had restructuring funds available, but they had to be matched by UK government funds and tax cuts and cutting government expenditure were a much higher priority for Thatcher and her cronies.
Mind you, if Starmer has his way then the UK will be rule takers, instead of the rule makers we were inside the EU.
Isn’t it a shame that we don’t have a PM willing to tell the truth about the EU and Brexit!
Mick; Looking at quarterly growth of both those countries in recent years – that figure just doesn’t stack up. What the first comment was probably referring to is the irrelevance EU membership was for them. You only need to look at the turnouts in those areas to see how dismal they were during EU elections.
As for the articles £180 Billion that’s just utter fantasy.
“The EU were not to blame for the collapse of British Industry,”
May be not. But more to the point EU membership did nothing to help.
By way of example in 1973, when the UK joined the Common Market, my home town of Lowestoft had a major fishing fleet together with supporting industries; two shipyards; two canneries; a television factory; Eastern Coachworks building bodies for buses; Boulton and Paul and other engineering companies. All very substantially reduced or completely closed. All that is left is Birds Eye and the traditional seaside tourist trade, reduced for other reasons. In addition we had a high street full of a variety of shops including three substantial Department Stores.
Membership of the EU did nothing for Lowestoft and anyone who thinks that saying “membership of the EU didn’t cause these closures” is helpful to their cause is fooling themselves.
And in the case of the fishing industry together with at least one shipyard and all the associated supporting trades that would be false because membership of the Common Fisheries Policy was a major factor in the decline.
There are quite a few different estimates lurking around of how much Brexit has reduced UK GDP, and certainly some of those estimates are around the £180 Bn mark, others are lower. It’s extremely hard to come up with an accurate figure because any estimate is comparing reality with a hypothetical scenario. In that context, claiming that rejoining would gain the UK £180Bn/year is if that was an absolute certainty is not at all justified. I’m sure GDP would benefit somewhat from rejoining but we don’t know by how much.
I think the article also makes the mistake of assuming standard of living is based on monetary GDP alone, without considering what resources are available. For example, Gareth claims it will lead to ‘affordable housing’. Well, no: Housing is unaffordable because there aren’t enough houses. Rejoining will not in any way reduce that shortage (and could make it worse if it leads to higher immigration). So it won’t make housing more affordable.
Amdrew Tampion. Funny how in other countries, the EU did help, but in the UK, governments all blamed the EU for any problems or difficult decisions and refused to put up money to match EU structural funds that might have helped the areas you mention.
Simon Robinson. Housing is not an EU competence, so of course joining would not help housing. The UK government has to take responsibility for the continuing housing crisis: build council houses or ay least encourage councils to do so. [LibDem councils are doing this where they can]; force builders to build the right sort of houses and stop them hoarding land; make entering the building trade an attractive proposition; stop the nonsense on immigration that makes it so difficult for building workers to come to the UK. I could go on…
Mick
As far as my comment is concerned I don’t think you are addressing the issue. Which is that many communities in the UK saw no benefit from EU membership. Expecting people to get excited about a misleading claim is not helpful. Further if your right why should anyone expect things to change given that there n evidence that the UK political system hasn’t changed.
Regarding housing. Why are you attacking Simon rather than Gareth? If housing is not an EU issue then Gareth is wrong to refer to “affordable housing” as a benefit of EU membership and Simon is right to call this out. But it is not clear that the EU had no impact on the UK housing problem as millions of EU nationals moved here under free movement and the housing stock did not increase to match the demand.
To those who regard honouring the June 2016 vote as a sacred duty, I would point out that 37% of the adult population voted for leave, 63% didn’t. The correlation between leave and advanced age meant that even by January 2019, those who actually voted leave outnumbered those who voted leave; further deaths in the last six years means the remain majority will be even larger, even if you ignore the numbers of young people who were too young to vote, but are now facing all the disasters caused by Brexit, and anyone sensible enough to look at the evidence and realise leave was the wrong choice.
Belief in the validity of referendums is misplaced. The issues were far too complicated for the average voter, and I met a lot of them while campaigning for a second vote. Among the valid reasons were being undercut by cheap labour from Poland, but I was also told there were too many Somalis in Bristol, we could get better trade deals on our own (better than a 500 million people trading bloc ?), the feeling that we needed to go back in time to when Great Britain was great, that is wasn’t right for the EU to set the rules, like too much “elf n safety” (we wrote a lot of those rules, and we still have to follow them in order to trade with the EU). And ‘free movement’ doesn’t seem such a bad thing now we’re having to spend up to five hours getting through passport control.
It may offend some upholders of what they contend is ‘democracy’, but I think we should all have learned by now that holding referendums is a supremely bad idea. Quite apart from all the shenanigans like overspending and knowingly false promises, expecting ordinary voters to understand all the complexities for the economy and our place in the world and vote for the whole country rather than their own narrow range of interests is wrong. That’s what we have MPs for, and in 2016 they favoured remain.
Those pesky voters Andy eh !
To lump those who didn’t vote as a percentage is being disingenuous. If they really cared about the EU they would have got off the sofa & voted. As Andrew has indicated membership wasn’t a panacea to a prosperous UK. Membership became irrelevant to many communities. Who can blame them. Nothing complex in seeing local towns hollowed out year in year out.
The purpose of referendums is to reduce a spectrum of opinions into two groups with yours in the bigger one. That way you can claim the majority of the public agrees with every comma of your view and the minority are betraying the will of the people.
Well yes, Chloe, I am blaming the pesky voters. No one doubts that they had grievances, but leaving the EU wasn’t going to solve the problems they faced. Regarding my lumping in people as effective remainers, it might be worth pointing out that we were in the EU at the time. The vote was about whether we should leave. It seems more likely most of those who wanted to leave ‘got off their sofas’ and that those who couldn’t be bothered didn’t have strong feelings, or couldn’t make up their minds. I contend that not voting meant they didn’t actively want to leave.
I would take issue with some of Andy’ Daer’s points but he is right on the key points about the folly of seeing a referendum as the ultimate form of of democracy. Whatever the faults in the British constitution we remain a representative democracy and long may it continue. We can use our votes to remove MPs if we so wish but we can’t sack the voters if they are later seen to have got things wrong.
As Andrew has pointed out Andy , being in it (EU) didn’t either. The status quo is a tough old sell. I dispute the fact the those who couldn’t be bothered to vote were shy remainers. It was probably more indifference than anything. The same as the EU elections every 5 years, which were always a reminder that the European Union just wasn’t as popular as many on here like to think.
“A stronger economy means higher revenues without increasing tax rates.”
This statement sounds so plausible that hardly anyone, except perhaps nerds like myself, will stop for a moment to think about it.
If they did they’d realise that many stronger economies than ours have higher tax rates whereas many weaker ones have lower rates. These are sometimes much higher and much lower respectively.
So whereas the statement is true for a local government it isn’t true for a central government which in charge of the macroeconomics of their currency area.
@ Andy,
Many LibDems do wonder why the “hoi polloi” have an unfavourable view of many in the Lib Dems, which are considered to be part of an entitled elite, and which has led to the loss of all your more working class seats.
Phrases such as “… I am blaming the pesky voters” and “but leaving the EU wasn’t going to solve the problems they faced ” might offer some clue. The second one might not have been so bad if you’d used “we” instead of “they”. The implication is that you weren’t having the same problems yourself.
I find it odd that the modern UK left are quite so in love with the EU. It used to be the other way around of course. The left was opposed and the right wanted the neoliberally based capitalism that came with it.
Whether Gareth is right to state that the UK would benefit to the tune of £180billion per year isn’t really the point. Pretty much everyone agrees that we would be better off by tens of billions, just as it is clear that a clear majority now see Brexit as a mistake. And please let’s not regurgitate the pros and cons of ‘honouring the referendum’!
Rejoining is very clearly in the UK’s economic interest. The EU needs to change, too, and it needs Britain to help reshape it. We need to be bolder in pressing that case.
Sometimes arguments that are meant to be in support of the EU and in favour of our rejoining are somewhat counterproductive.
For example: “Britain remains a wealthy country….but that wealth is unevenly distributed and overly concentrated in property. Rejoining the EU would help rebalance the economy ……spreading opportunity more evenly across the country.”
The inherent flaw is that the property boom, a large factor in the increased level of inequality, started well before we even had a direct vote on the question of EU membership and while we were members of the EU. Other factors are the boom in the stock market , the rise in the importance of the UK financial sector, and the loss of relatively well paid jobs in the manufacting sector. These also predate the 2016 vote.
So how will rejoining the EU do anything to reverse the process?
Rejoining the EU would probably be a good idea, but it probably needs a sufficient percentage of voters in favour that it’s clearly not going to be “no, we changed our minds again” just a few years after filing the paperwork, since it’s likely to take most of a decade to realign the country to EU standards for the accession process, even in the best case. Getting to the stability of public opinion where there’s no chance of anti-EU parties forming the government and withdrawing from the negotiations? Probably another decade away even in the best case – it certainly does not look like that’s impossible right now!
Worth working towards, sure, as a long-term goal. But it’s not something which can solve anyone’s immediate problems – those need solving without it.
This is an example of politics trumping good decision making. Part of the issue is uk specific and lies in our electoral system. We need a breed of national politicians who can adapt quickly to changing circumstances and are not tied to previous decisions and are able to take the electorate with them.
Pesky voters,
What do we get if we form a Venn diagram between (pesky voters), a (pretend democracy), and (superiors who know best)?
Pichforks.
Maybe that is why real democracy (including its flaws), was the better choice.
Pitchforks
The EU might not solve the long standing problems of wealth inequality and income inequality, but young people tend to want to be European rather than the Daily Express version of flag waving English. A strong Europe would also be useful while a lunatic occupies the White House, and an unconvicted war criminal rules the Knesset.
What I think is more important for many young people than the economy (and precisely how many £bn we’re missing out on) is that they are happy to enjoy our cultural ties with our European neighbours, while the Brexiters are in many cases little Englanders who say they believe in the inherent superiority of the British (and want to reassert our past greatness), but are in fact simply frightened of foreigners, and want to pull up the drawbridge.