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Friday, November 23, 2007


Earlier this year Gunter Verheugen, EU Enterprise Commissioner, said that the EU's regulations cost the community £405 billion annually (5.5% of GNP) According to Wikipedia the EU's GNP is $13.8 trillion & Britain's is $2.27 trillion ie 16.45% of the whole. Therefore the regulatory cost to us should be £66.6 billion. Direct payments to the EU for the decade up to 2002 were:

The latest figures show that over the ten-year period 1993-2002 inclusive, the UK paid over to EU Institutions... gross, cumulatively: £104 billion.

In those same ten years the UK received back, cumulatively: £64 billion.

So the UK's net contribution over that ten-year period was £40 billion, or an average of £4 billion per year
Correcting for inflation & growth (cumulatively about 5% a year over 10 years) should be a bit over £6 billion.

This makes a total cost of £73 billion a year, which, with 29.22 million employees in Britain. amounts to £2566 per head (that is after tax!).

Of course this makes no allowance for the possibility of bias. It is conceivable that Gunter's figures are not entirely accurate, however I think, bearing in mind that he is an EU Commissioner, that they are not going to be an underestimate.

Of course this takes no account whatsoever of the fact that EU growth is, unsurprisingly, less than the world average, as is almost inevitable if 5.5% of GNP disappears into the regulatory morass. Taking the EU growth rate as 3.2% (I must admit I was surprised it was so high though clearly it is disproportionately in the poorer eastern European & Iberian countries which is thus worse for us) compared to the world average of 5% means that over a decade we lose 17% of our incomes. Compared to the direct financial cost that is far higher.

Hi. I just stumbled across your blog here and for the 9% growth party. Very pleasing to see somebody else who shares classic liberal values and wants the state to get off our backs.

Also this post on the EU's cost is a very good rough analysis. Have you seen this analysis from the bruges group?
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