Auf Wiedersehen, Pet (We’ll take on debt)
On the 23rd June 2016 the population of Britain was given the opportunity to vote on one the most important decisions in a century. The result shocked millions the world over when the UK decided to leave the European Union.
The UK Referendum has received almost as much air time as Donald Trump, the future US President, and is certain to receive an awful lot more before Brexit is affected with article 50 implemented and the UK becoming the separate economic entity from the rest of the EU that the majority of its population voted for.
Some remain campaigners have suggested that another referendum is held, but in my opinion we cannot be a true democracy if we keep holding referendums until the vote goes the way we want!
Regardless of my personal opinion on the outcome I believe that when a vote is cast it should be adhered to.
There are many aspects about being part of the EU that personally I don’t like such as the ludicrous situation of a past EU law whereby bananas and cucumbers had to be of a certain shape and appearance and be “free from abnormal curvature” – the phrase alone is bananas in my view!
On top of laws such as these, there is the cost of red tape which hinders business, in particular small and medium sized businesses which often struggle to find the time to deal with so many rules and regulations which perhaps do not always apply to them, and which might apply to larger businesses which are better able to cope.
It has been reported that SME’s spend, on average, 28 hours per week making sure they comply with EU rules! That does seem a high estimate to me however it highlights the potential cost unnecessary red tape has on business which in my opinion restricts job creation, growth and economic prosperity and ultimately the happiness of a nation.
Perhaps we should remember though that the UK, at the time of the vote, had more people employed than at any time in it’s history, and a relatively strong economy given the aftermath of the 2008 collapse.
The UK economy is however built on a mountain of debt that would make British mountaineer Chris Bonington wonder whether he should have taken up scuba diving!
As with many world economies, our debt levels are out of control.
The UK, at the time of writing is paying over £1Bn a week in interest alone on its national debt which is now running at around 90% of GDP. A Billion Pounds a week in interest!
This is entirely unsustainable!
Figures such as £1.9Trillion of debt and £1Billion a week in interest payments are rattled off by politicians and news broadcasters as if we are talking about buying some pick n’ mix!
Not to mention the Chancellors announcement in the Autumn Statement on 23rd November 2016 that borrowing would increase by an estimated unbelievable £122Bn before 2020 (ie. in the next three years) largely as a result of the Brexit vote.
The impact of such a huge economic change has in my opinion been vastly underestimated by many and won’t be a walk in the park. Just entering a planning application or appealing a parking ticket can take long enough, let alone unraveling over 40 years of laws.
Someone said to me the other day “it’s great now we are out of Europe.” Sorry but we are not out! Even when we are ‘out’ it’s the EU we are leaving not Europe itself!
The figures I mentioned are huge and affect the livelihoods of the those who are expected to repay these debts now and in the future. That’s us and our kids, grandkids and possibly even their grandkids.
I’m all for speculating to accumulate, as an entrepreneur you have to be prepared to take a chance and that often means taking on some debt but daily bargaining with the livelihoods of a nation, in the UK and elsewhere surely has to stop somewhere?
Debt doesn’t go away unless you pay it off!
This is true for an individual or business and is also just as true for a country.
If a business borrows more than it spends, it ultimately goes bust and out of business. If a country borrows more than it spends, the national debt grows!
This has become the norm and accepted by millions of people all over the world. Perhaps not consciously though because the vast majority of us are too busy going about our daily lives, and either growing a business or holding a job down as we keep the wolf from the door!
Brexit, whether you voted for it or not has led us to a period of uncertainty. Whether that uncertainty leads to greater prosperity for our nation or not, only time will tell, but in my opinion it is far too early to call ‘business as usual’.
We live in uncertain economic times with a political and dangerous world and whilst opportunities will have been created because of Brexit, now is not a time for complacency in my opinion. Now is a time to draw together as a nation and find a way of what the majority of the population voted for working.
It’s time to crack on and make Brexit work for Britain. What else is there to do? As Sir Winston Churchill once reputedly said, “I am an optimist. It does not seem too much use being anything else.”.