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by Brian Monteith

WHAT DOES IT TAKE to be a successful entrepreneur and not become a political hate figure? Is it really possible? If we are to believe the digital kangaroo court that is social media (and especially Twitter) then Sir James Dyson should be stripped of his knighthood and have his successful business nationalised, together with other beastly things too sordid for this respectable website to mention.

Why? Well this week it was announced his eponymous company Dyson intends to move its corporate HQ to Singapore. Businesses move their headquarters, manufacturing and back office all the time, but this announcement was especially spicy because Dyson came out publicly as an arch-Leaver during the EU referendum. Depending on your take on the EU debate Dyson therefore became a figure of admiration for his bravery in speaking out against the serried ranks of establishment business figures – or a demon for revealing himself as a putative little Englander.

The truth of it all is of course far more complex.

Dyson is a private company and its tax bill in 2017 was £185M of which £95M went to the UK, with millions more being ploughed into a new technological university in England. Since his success in challenging and defeating the accepted wisdom of how a household vacuum cleaner should work and look, Dyson has moved on to do far more. His next big thing is producing electric and driverless cars and it was last year he announced the manufacturing of his vehicle would be located at Dyson’s existing Singapore production line. Immediately he was criticised for not locating the new plant in the UK but his entirely rational defence was that the planned 8,000 units per annum were destined for the Chinese market and it made good business sense to assemble in Asia.

Dyson employs some 4,800 workers in the UK and a further £200m is being invested in Hullavington, Wiltshire.  Its business model is typical of many international businesses that produce electrical and white goods, conducting their R&D and design in their home country but manufacturing close to their large markets or where costs are lower. If anyone cares to look at an Apple phone or laptop it usually says designed in California and made in China; nobody would say Apple is not American but Chinese – and Dyson is no different from this approach.

What is important for the UK is that, Brexit or no Brexit, its business environment and culture is able to generate new businesses that create jobs across a wide range of roles. Some of these will be in innovative research, some in design, manufacturing and assembly, and others in sales, marketing and distribution. Depending on the product where the most value added earnings come will vary; for Dyson it is primarily in the R&D and design – which remains in the UK. Moving the HQ – which apparently involves two executives relocating to Singapore – reflects the business dynamics the company is working in and the market the business is aiming at and does not change it from being intrinsically British or suggest Dyson is himself abandoning Britain.

It strikes me as ironic if not hypocritical that Dyson and other business entrepreneurs like him are pilloried for being insular isolationists wishing to retreat from the world because they are Leavers, but when they expand their operations to seek out and develop new markets that will help make the UK richer they are accused of being evil hypocritical globalists betraying their country.

But what about Brexit? Look, over there, Sony is moving it its HQ to the Netherlands and Airbus is threatening (again) to depart. It must be Brexit!

Well yes and no. Changing the UK’s  business regulations and taxation will create opportunities to be exploited or hazards to be avoided. It’s not as if companies have not been leaving our land while in the EU; Ford moved UK Transit production to Turkey and Jaguar its Discovery assembly to Slovakia – both with the help of EU grants. In contrast Boeing has announced a new manufacturing facility in Sheffield and Aston Martin’s new car plant will be in Wales, despite Brexit, as both decisions were taken in full knowledge of us leaving the EU.

There are tax advantages to Sony being in the Netherlands (as opposed to other EU countries) through its offshore dependencies which, with a more dynamic UK Chancellor, Britain would be looking to compete against. Were Philip Hammond to be replaced by a tax reformer looking to use the liberalising prospects of Brexit then companies like the Sony could easily relocate back to our shores.  It is already happening in some manufacturing sectors that had previously left for overseas.

As for Airbus it is just as likely that if in the long term it were to relocate it would be to China or the US and not elsewhere in the EU. (It is also now coming out that Airbus was encouraged by Remain ministers to speak out at Davos).

The point is that what Remainers (and maybe some Leavers) don’t get is Brexit is not an end in itself; the value of the change can only be realised by then becoming better at what we do, at being more business friendly, by educating our workforce better and by making it a better country to live in. Leaving the EU to then stay in the Single Market, its Customs Union, under the jurisdiction of the ECJ and paying for the highly questionable privilege is self-defeating.  Singapore has a trade agreement with China that includes low tariffs for importing electric cars, helping Dyson decide to manufacture there. There’s a lesson there for the UK

Alan Sugar continues to have a successful career, still pays a huge personal tax bill to the UK Exchequer but decades ago relocated most if not all his manufacturing requirements to the far east. It made for good business sense in a highly competitive market – the fact that he is a Labour-supporting remainer is wholly irrelevant to what makes his businesses successful. Nobody goes around saying he has abandoned Britain.

Dyson is no different for supporting Brexit. We need more James Dysons (and Alan Sugars) and the quicker we can restructure our economy and business culture to encourage more entrepreneurs the better off we shall all be.




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