ONS To Knock Vote Leave’s £350m Fiction

The Vote Leave campaign takes every opportunity to assert that Britain pays £350 million per week to the European Commission. In a recent video playing on voters’ concern about the NHS, for example, Vote Leave says that the health service would be in better shape if the UK was not sending £350 million per week to Brussels. The Vote Leave web site complains that the £350 million is “about half the English schools budget.” Brazenly, Vote Leave often labels its claims with the word “FACT” in red. FACT: “The EU now costs the UK over £350 million each week.” FACT: “Our EU contributions are enough to build a new, fully staffed NHS hospital every week.” And so on.

Vote Leave’s “FACT” has already been corrected by multiple observers. InFacts has done so repeatedly, for example here. The Financial Times has called Vote Leave’s claim “far from accurate.” BBC Reality Check has weighed in. The Institute for Fiscal Studies has commented that “ignoring the rebate in this way does not seem sensible”.

Now, in a letter to InFacts on May 6, Jonathan Athow, the Office for National Statistics (ONS) director general for economic statistics, has pledged to clarify the matter in releases planned for May 25 and May 26. Provided that he delivers on this pledge, Vote Leave should be left with nowhere to hide. The Brexit camp will have to drop its £350 million a week assertion or effectively declare an intention to base its campaign on a falsehood.

The £350 million a week claim comes from Table 9.9 in the “Pink Book” produced by the ONS. Both Vote Leave and its supporters have pointed to this table (see here and here). Table 9.9 reports “Total debits” to the EU at £19.1 billion for 2014, which works out at £367 million per week. But this number is not the amount that the UK actually sends to the EU, let alone to the net cost of EU membership.

The biggest problem with the “Total debits” number is that it does not count the rebate negotiated by Margaret Thatcher. This rebate appears elsewhere in Table 9.9: an item called the “Fontainebleau Abatement” reports that the UK received £4.4 billion from the EU in 2014. Subtracting that from the “Total debits” of £19.1 billion leaves a debit of £14.7 billion, or £283 million per week. In other words, the “Total debits” number inflates the reality by about a quarter.

What’s more, the “Total debits” number is especially misleading because it is not actually debited. That £350 million is never paid to the EU. The rebate is subtracted before the UK sends its money to Brussels. Despite Vote Leave’s language, there is no justification whatever for using the “Total debits” to the EU rather than the number that the UK actually pays—the one after the rebate.

Unfortunately, the fact that the “Total debits” number is not what the UK really sends to Brussels is unclear in Table 9.9. InFacts has written to the ONS to urge that the table should be amended so as to rule out claims that mislead the UK public.

Understandably reluctant to be drawn into a political fight, the ONS has been cautious until now in clearing up the misunderstanding. The chair of the UK Statistics Authority, Sir Andrew Dilnot, has warned that the £350 million per week figure “appears to be a gross figure which does not take into account the rebate or other flows from the EU to the UK… Without further explanation I consider these statements to be potentially misleading.” However, Sir Andrew has chosen not to explain that claims that the NHS would be on stronger ground if the UK “saved” £350 million per week are more than “potentially misleading”. They are outright false.

Responding to the letter from InFacts, Athow makes three points. He stipulates that “Table 9.9 does not intend to explain how the cash flows between the UK and the EU,” an admission that is accurate but unfortunate. He says that the ONS will use the planned release of two “UK Perspectives” articles on May 25 and May 26 to go through the various assertions made about UK contributions to the EU and to clarify them; we trust this will be done forthrightly. Finally, he says that future publications of Table 9.9 will include a new footnote “clarifying the point that payments are made to the EU after the rebate has been applied.” This is welcome, though the first amended version of the table will unfortunately appear only after the referendum.

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If Athow can advance a better understanding of the EU rebate later this month, he will have gone some way to ensure that voters receive good information before they decide on Britain’s position within Europe. But the confusion over the rebate is only the start. Using a more recent data release from the Treasury, InFacts has shown that the net cost of Britain’s contribution to the EU is £6.3 billion per year. That works out at £120 million per week—not Vote Leave’s much repeated £350 million. And besides, the UK would not actually save £120 million per week by quitting. Any saving on our contributions could well be wiped out by economic turmoil.

Vote Leave needs to admit that its prized £350 million per week campaign factoid is wrong. Britain’s future in Europe should not be decided based on fictions.

Edited by Sebastian Mallaby