TONY Blair last week told an audience in County Durham that David Cameron's pledge to hold a referendum on Britain's EU membership would cause economic chaos.

Was the former Sedgefield MP correct?

Mr Cameron said his predecessor was ignoring the will of the people.

The EU has grown into a very different entity the one MPs voted to join with a 112 majority in October 1971.

As Ukip has built-up a powerbase with its anti-Brussels stance, Labour has made its opposition to a referendum a key plank of its appeal to the business community, although some bosses have warned that while a referendum may cause uncertainty, the EU needs a shake-up.

Mr Cameron also wants the UK to remain within a reformed EU, with powers coming back to Britain.

"You can't stay in an organisation unless it has the full-hearted consent of the people and that is why it is right to have a referendum," he said last week.

Europhiles point to the fact that the North-East economy does rather well out of the UK's ties to the EU.

Our region is a net beneficiary of European funding, and some employers have set up bases and continue to invest millions in the North-East to give them a bridgehead into an open market of 500 customers. Pulling out of the EU could see Nissan, SSI, Sabic, Gestamp, Nifco, Vantec, Hitachi and scores of other inward investors rethink their strategy.

The North-East is the only region in England with a positive balance of payments. Almost half of our export business is done with members of the EU, supporting an estimated 140,000 North-East jobs.

The CBI said EU membership was worth up to £78bn to the UK economy; about £3,000 a year to every household.

On the other hand EU rules stretch way beyond free trade, and enable economic migrants to pitch up on our shores and offer their services at rates that sometimes undercut native workers.

A recent dispute at the new Sita Sembcorp waste plant on Teesside was sparked by trade union concerns that cheaper overseas labour was being used to build the £250m project.

We asked a cross section of the region's bosses, from major blue chip employers to small firms, how they viewed the EU.

Alastair Wilson, tax partner at Tait Walker Chartered Accountants:

• Should the UK stay in the EU? "Yes."

• Why? "The North-East is a beneficiary of substantial regional support and grants from the EU. Our region’s main trading partners are Europe – statistically the EU represents more than 50 per cent of the market for exports by North-East based companies.

"The EU provides four times as big a marketplace for North-East based companies than any other global region. Acting in a manner which would distance ourselves from that marketplace and deliberately make it more difficult to trade with that market would be likely to be detrimental to our region and possibly more so than for most other regions of the UK."

• Would you like to see us renegotiate the terms of our EU membership? "No."

• What are the priorities for any renegotiation of the terms of the UK’s EU membership? "The main campaign for renegotiation is around what would be classified as relatively right wing issues – the main issues the current Government would like to renegotiate are the right of free movement of workers, in particular from countries in the East of the EU where there has been migration of low skilled workers to the UK and the right of the EU to regulate the UK and in particular areas like financial services regulation. I don’t perceive these as a particular threat to jobs or the ability to create work in the North East of England’s economy, albeit the impact may be more noticeable in other regions.

Working with our European colleagues to create wealth will be better in the long run than trying to win special concessions which will be resisted by all the other members of the EU."

Ian Malcolm, managing director of ElringKlinger (GB):

• Should the UK stay in the EU? "It should without doubt stay in the EU. You cannot change the rules if you are not part of the club. I cannot see a single business case for withdrawing."

• Why? "Trade within the Union is easier than with other parts of the world. We are a German-owned company so directly benefit from inward investment."

• Would you like to see us renegotiate the terms of our EU membership? "Yes, definitely."

• What are the priorities for any renegotiation of the terms of the UK’s EU membership?

"The beast is nothing like it was when we entered so changes have to be made. Things move on. I would like to see more control of laws back in the UK, it should be an economic rather than a federal organisation.

"Common Agricultural and Fisheries Policies need to be updated completely to give a fairness across all members. Health and safety legislation needs to be implemented on a common basis across the EU to level the playing fields. I don't think the EU should determine the legislative and criminal law in this country."

Mark Stephenson, policy and research manager, North East Chamber of Commerce.

• Should the UK stay in the EU? "Yes, in a survey of our members, they were dramatically - about 75 per cent - in favour of the UK remaining in a reformed EU."

• Why? "Europe is the largest export market for North-East goods and is a key factor in the regional success of large manufacturers such as Nissan – the supply chain for which employs over 150,000 people, even if it’s not the final destination for most of them, European ports are some of the arteries that link us to the rest of the world. However, if we are to truly work together as a united Europe then there must be a relaxation of some of the regulation to grease the wheels of overseas trade."

• Would you like to see us renegotiate the terms of our EU membership? "We need reform in Europe rather than necessarily changing the legal terms of membership – in particular on regulations which businesses are very eager to see changed. For example less bureaucracy around procurement, fairer implementation of shipping regulations and more critical approach to implementing any regulation that may impact on employment and growth."

• What are the priorities for any renegotiation of the terms of the UK’s EU membership? "It is difficult to see how we can re-negotiate the terms of existing treaties. If we want the huge benefits of membership we have to live by the rules which we can at present help to set, unlike Norway and Switzerland who still have to live by them if they want to do business in the common market. The idea we can leave and still do business with Europe without the regulations is fundamentally wrong."

Mike Matthews, managing director of Nifco UK and European operations officer.

• Should the UK stay in the EU? "Yes."

• Why? “We believe that membership to the EU is essential to allow free trading between the UK and other countries, so we are firmly of the mind-set that leaving would be absolutely wrong."

• Would you like to see us renegotiate the terms of our EU membership? "Yes. The UK has a comparatively strong economy and I therefore believe that we are in a strong position to renegotiate our terms of membership. For me, the main issue at the moment is the bureaucracy associated with international trade and the less of that there is, the easier it will be for the UK businesses to trade with their European counterparts."

Matthew Hunt, port of Sunderland director.

• Should the UK stay in the EU? "Yes."

• Why? "Ports are a key gateway into and out of the UK, and as such, they can only be successful if the country is trading – if goods are coming into and out of the UK.

“As a net exporting region, the implications on the North-East of exiting Europe could be significant. It is difficult to know for certain what the impact would be, but being part of the EU surely creates a stable marketplace and good conditions for trade with businesses here. If leaving led to a fiscal disadvantage for the country, the North-East would feel the impact more than other places, as the only part of the UK with a positive balance of trade.

“And as a place that is trying to attract inward investment, EU membership offers the certainty, and stable and predictable environment needed to persuade them to choose the UK."

Geoff Riddell, director of JFS2000.

• Should the UK stay in the EU? "Yes."

• Why? "Trading has always been the centre of our island's wealth. It accidentally built an Empire and a commonwealth followed. Then was added the whole of Europe to trade freely with. To remove the benefits would badly affect local trade as there would be less investment i.e. Nissan, the chemical companies in Teesside, with a strong negative knock on to local trade. Greater unemployment and generally less money to be spent in the area."

• Would you like to see us renegotiate the terms of our EU membership? "Yes. The EU would be better run on an asymmetrical federalism system."

• What are the priorities for any renegotiation of the terms of the UK’s EU membership? "The EU should stay as a free trade area but in other aspects each country should be allowed different powers although they have the same constitutional status."

• Ted Salmon, owner of Tian Da Marketing.

Should the UK stay in the EU? Yes.

• Why? "I think we've little choice. This region gets a lot of EU economic funding plus 40 per cent of UK exports are to the EU, unless we have an established alternative market then it makes little sense to opt out.

"While I am looking at ways to grow and diversify my business by expanding into non-EU markets, it doesn't directly depend on the EU either way, however, like many others I'm indirectly affected by it as my clients are other businesses."

• Would you like to see us renegotiate the terms of our EU membership? "Definitely yes, it was established as a common trading area to benefit its members - a handful of fairly similar countries in terms of economies, now it's evolved into almost 30 members with very different needs. For example: Apple was started by three lads in a garage and incorporated in 1976. It's grown a bit since then and it wouldn't be unreasonable to assume there's been one or two rethinks as to how things work over the years to accommodate the major multinational business we see today."

• What are the priorities for any renegotiation of the terms of the UK’s EU membership? "Start with the basics - it's a trade area and establish common rules for the movement of labour within that area; e.g. benefits: where someone has moved to look for work in another country let them continue to be eligible to receive the relevant benefits that they'd already qualified for and paid from their home country for a set period, and excluded from any benefits in the new state for a few months thereafter, that way people will only move for genuine reasons.

"Health: people should have proof of insurance to cover their potential health costs in the new country for the first two or three years of employment so that they will have then paid into national insurance or its equivalent before getting free treatment.

"The Euro Area: Non-euro members should not be required to pay extra funds into any type of euro insurance scheme. There has to be greater transparency and accountability, including for the EU finances which have not passed an audit for years. We should also remember that is not only the UK that's unhappy with the state of things as they are, there are other EU members where the people are unhappy, the previous referendums are examples."