Comment: Cameron should fight for a better deal with Europe

NOTHING much divides British politics more than Europe and, more specifically, our membership of the European Union.

The gap separating europhiles and europhobes seems as wide as ever and the Prime Minister has some tough hurdles to leap if he is to achieve the sort of pragmatic solution to Britain’s relationship with the EU demanded by businesses.

Yet in spite of the arguments, there is broad agreement that Britain should not leave the EU, nor stick with the status quo. What appears evident, as our story today reveals, is that British business wants a new relationship with Europe; 
one free from the suffocating directives and restrictions of Brussels, and which encourages free trade.

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Today’s call from the British Chambers of Commerce for David Cameron to set out exactly what Britain needs follows comments from David Hodgetts, UK managing director of Honda, who insisted that membership of the EU was vital in order to avoid damaging the economy and losing investment.

He made his views known after announcing 800 job losses in Swindon caused by a slowdown in demand for cars in Europe. Despite that, he argued that Britain and Europe were so dependent on each other that exiting would be a backward move. Honda’s Wiltshire plant exports 90 per cent of its production to Europe and the company has said it remains committed to the UK and the trading bloc.

Membership is also vital to encourage companies in other regions to invest in Britain. 
It gives them access to all 27 nations. Leaving would put huge question marks over future investment from Asia and the US.

While it has brought huge trading benefits, the EU is an unloved institution largely because it is regarded as an oversized, faceless and distant organisation beyond the control of the ordinary citizen, but mostly because of its reputation as a gravy train for bureaucrats and MEPs.

Cameron’s negotiations, ahead of a referendum expected after the next general election, are unlikely to change any of those perceptions, but if he can come up with a better deal for British business he could do himself, his party and the country a big favour.

Many retailers still on death row RARELY has the difference between the haves and have nots of the retail sector been so exposed as during the festive trading period.

John Lewis shows no sign of weakening with sales surging 13 per cent over last year, while House of Fraser achieved a record-breaking performance with a 6 per cent rise in the six weeks to 5 January.

However, selling lots of stock cheaply is no guide to underlying performance and does not translate into surging profits. But even here there are some positives, with John Lewis margins at 6 per cent and Debenhams achieving 8 per cent.

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But the figures still hide the real picture on the high street. Much of the growth in retail is now online and without a stonking 17.8 per cent rise in internet sales for non-food goods there would have been a fall in overall sales, telling us that the shopper is still spending cautiously.

As for those on retail’s death row, Jessops became the latest casualty of a ruthless cull. The camera chain has been unable to challenge the rise of mobile phones just as HMV, the next likely victim, has struggled to sell CDs into a market dominated by downloads. Sadly, they won’t be the last.

Twitter: @TerryMurden1