At Prime Minister’s Questions on 20th March, the Prime Minister stood at the Despatch Box and repeatedly told the Commons the maximum extension to Article 50 that she could countenance. Answering MPs from across the House, she said:
“I am not prepared to delay Brexit any further than 30th June… I could not consider a delay further beyond 30th June… There will be no delay in delivering Brexit beyond 30th June.”
Yet when, in the small hours on Wednesday morning, the EU offered an extension to 31st October – fully four months after her self-imposed cut-off and seven months after we should have left – she accepted. Another promise, made to Parliament and the country, was broken. We should have left at 11pm on 29th March. Even as the Prime Minister arrived in Brussels, the law of the land was that we would leave at 11pm this evening, Friday 12th April. All she had to do to deliver that was nothing.
So for all that the Prime Minister may speciously argue that she has been somehow forced to extend, there is no doubt that she has sought delays of her own volition. Remember that the formal letter requesting an extension was sent before Parliament had approved the change in domestic law.
Just as common law courts once applied the maxim Falsus in uno, falsus in omnibus, this latest broken promise could have been predicted from the previous occasions when what the Prime Minister has said and what she has done have not matched. Throughout her tenure, Mrs May had said that “no deal is better than a bad deal”. The Withdrawal Agreement is evidently a bad deal; the House of Commons has thrice told her so. Logically, she should then have pursued the “no deal” option, but did not. Evidently, she has bought into the ludicrous, apocalyptic predictions of Project Fear, convinced now that any deal would be better than “no deal”.
But the “no deal” which the prophets of doom continue to predict is a complete misnomer. In reality, when we say “no deal” we mean a WTO deal – leaving the EU without the Withdrawal Agreement but with a series of pragmatic, mutually-beneficial mini-deals in its stead.
The former Brexit Minister Chris Heaton-Harris – who resigned in exasperation – confirmed that such preparations are “well advanced” and told the Prime Minister that:
“I truly believe our country would have swiftly overcome any immediate issues of leaving without a deal and gone on to thrive.”
He is right. One by one, the absurd falsehoods peddled about “no deal” have been and are being debunked.
Air travel will continue. The EU confirmed in November that it would continue to allow UK airlines to fly over, land in and return from EU airports even if there is no Withdrawal Agreement, provided the UK reciprocates. Of course, it will. As Transport Minister Baroness Sugg confirmed in March:
“Measures put forward by the UK and the EU will ensure that flights can continue in any scenario; deal or no deal.”
Medical supplies will arrive. Health Secretary Matt Hancock has worked hard to neutralise this issue and, as the President of the Royal College of Paediatrics and Child Health, Professor Russell Viner, said in his message to 19,000 doctors:
“I have been considerably reassured by governments’ preparations relating to medicines supplies…Governments, the Medicines and Healthcare products Regulatory Agency and the NHS have been working hard behind the scenes… and we believe that our medicine supplies are very largely secured.”
Cross-Channel trade will continue. The Chairman of the Port of Calais, Jean-Marc Puissesseau, has robustly refuted the alarmist claims of disruptions to freight. Xavier Bertrand, President of the Hauts-de-France region has dismissed the scare stories with admirable clarity:
“Who could believe such a thing? We have to do everything to guarantee fluidity.”
The UK has been given approval to continue exporting animals and products of animal origin to the EU in the event of a no-deal Brexit. Live animals, including horses, will still be able to travel across borders. Will Lambe, Executive Director of the British Horseracing Authority, was right when he said that:
“This decision on listing from the European Union is extremely welcome and reflects the UK’s high health standards in respect of its animals, and of course the thoroughbred population within this. It provides important clarity for the racing and breeding sector ahead of a potential no-deal departure from the EU.”
Even the fears of a “hard” Northern Ireland border which have so dominated the debate are now subsiding. The Taoiseach, Leo Varadkar, has expressed confidence that arrangements can be implemented to avoid new border checks in the case of “no deal”. These arrangements are the same as our ERG proposals which were once smugly dismissed as “magical thinking”, but Michel Barnier has confirmed that in any scenario the Belfast Agreement will continue to apply and “there will be no hard border” using our alternative arrangements.
This approach would not be “crashing out”, as the fearmongers claim. Sensible measures, adopted in the best interests of both the UK and the EU, can mitigate any disruption and ensure that our relationships with our neighbours remain amicable and prosperous.
Nor is “no deal” an end state. With arrangements worked out for the Northern Ireland border, we can quickly return to the offer which Donald Tusk made in March last year of a wide-ranging, zero-tariff Free Trade Agreement – for the whole of the UK rather than just Great Britain.
In such a scenario, both sides can invoke Article XXIV of the WTO’s General Agreement on Tariffs and Trade. As long as the UK and EU agree to an FTA and notify the WTO of a sufficiently detailed plan and schedule for the FTA as soon as possible, we could maintain our current zero-tariff arrangements while the new deal was being negotiated.
Most importantly, this approach would provide the certainty which everyone craves. It would, finally, allow businesses to know where they stand and release much pent-up, pending investment.
All of this beckons if we leave with “no deal”. The decision from the European Council on Wednesday states that the UK must now, if still a member, hold European Parliament elections on 22nd May. If it “fails to live up to this obligation”, we will leave on 1st June.
This is an important opportunity which the Government must grasp. It is win-win. At a time when the Government is daily faced with the difficult task of balancing discipline on public expenditure with pressing demands for improving schools, roads and hospitals, it would be an act of the most outrageous folly to squander £100 million on unwanted elections when newly-elected British MEPs will immediately stand down in October, never mind the £39 billion which the Withdrawal Agreement would give away.
Yet by avoiding these utterly pointless elections, we can leave in an orderly way on 1st June and use the money on our own priorities. Do that, and the Government will honour the referendum result, its manifesto commitments, and repay the trust of the British people.
Do not, and its betrayal will be complete. If reports last night are correct that the Government has wound up its “no deal” planning at this crucial juncture, that would be stupidity verging on sabotage. The Government will have failed to deliver the single most important policy in a generation, and broken every promise it has made.
Just yesterday the formal group of eurosceptic Conservative MPs – the European Research Group – were described as “far right” on television by the Head of Comms of the Centre for Policy Studies. Emma Barr, who until recently worked as a Press Officer for CCHQ , has since claimed she meant the right of the Conservative Party, but this is just the tip of the iceberg when you consider the attacks on a group who are representing the mainstream Leave vote.
Barr also said that the ERG hadn’t compromised “at all”, which is just untrue. The irritating whine over the last few years from the talking heads has been that the Prime Minister has been “captured” by the ERG who have forced her to be too hard line. The truth is, the ERG have bent over backwards for a Prime Minister who has happily banked everything they conceded until she finally, this week, ditched half her party in favour of the Leader of the Opposition.
Just ask yourself this: would we still be in the EU nearly three years after the referendum if the Prime Minister was in the thrall of Jacob Rees-Mogg? Or would we be planning for the European Parliament elections if Steve Baker had Theresa May’s ear? For all her fighting talk at the last election, her grand exit strategy appears to have been a box-ticking exercise cooked up by civil servants. To ‘leave’, Theresa May used the EU’s own exit mechanism of Article 50 – hardly the tub-thumping idea of just repealing the European Communities Act suggested by some eurosceptics. She hadn’t even prepared the country for No Deal before she triggered Article 50, as Vote Leave had suggested should happen in their literature.
Far from ideological zealotry, the ERG’s compromises were too fast and too frequent for many Brexiteers. They accepted another 18 months of a transition period and even ECJ jurisdiction over the transition. Former Brexit Secretary David Davis accepted Downing Street’s sequencing of talks to begin with the ‘divorce’ first and then ‘trade’ second, despite personally disagreeing with it. The ERG even swallowed an exit bill of £39 billion, despite not believing that it was legally enforceable or that we even owed the money. Coastal MPs like Ross Thomson were apoplectic at the fact that under the transition the UK would remain in the Common Fisheries Policy after 29th March, after Downing Street dropped more of their red lines.
So who has really been captured? The only conceivable way in which Theresa May’s policy is connected to her Brexit-supporting MPs is that she needs their votes to get it through. But even then there has been no compromise from her side. Three times she has forced the same deal on the Commons with all the diplomatic guile of a battering ram.
When she, for one brief moment, appeared to be offering a compromise, almost the entire swathe of eurosceptics came so far they almost accepted her entire deal. The ‘Brady Amendment’, the one thing the Commons has actually approved, accepted the Withdrawal Agreement if the backstop was replaced with ‘alternative arrangements’. But this was a false dawn. Despite whipping MPs in favour of it, no attempt has been made by No. 10 to follow through. In her latest begging letter to Donald Tusk, the Prime Minister assured our bemused jailers that changing any of the unsigned Withdrawal Agreement was out of the question.
The idea that we’re in this mess because the Prime Minister has listened to Leave MPs is clearly false. Surrounded by the likes of Olly Robbins, Downing Street neither understands nor cares about the damage they have done to democracy, the constitution or the trust they have with the electorate. And when the history of this period is written, the ERG – the real mainstream of Leavers – will be viewed as flexible beyond belief in the face of a Government that treated them with nothing but suspicion and disdain.
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Below is the full text of the letter Theresa May has sent today to European Council President Donald Tusk, requesting a further delay to Brexit until 30th June, with the option to leave earlier if her Withdrawal Agreement is ratified
In the European Council Decision of 22 March, taken in agreement with the United Kingdom, the European Union and the United Kingdom agreed that if the House of Commons had approved the Withdrawal Agreement by 29 March 2019, the period provided for by Article 50 of the Treaty on European Union would be extended until 22 May 2019 to provide for ratification.
The House of Commons declined to approve the Withdrawal Agreement and take up that option. Therefore unless we agree a further extension at the European Council you have convened for 10 April, the United Kingdom will leave the European Union without a deal at 2300 BST on 12 April 2019.
The Government’s policy has always been and remains to leave the European Union in an orderly way, and without undue delay. The House of Commons has not thus far approved the deal that would enable this, nor — despite considerable efforts by both Members of Parliament and by the Government — has it yet found a majority in favor of any other proposal.
The House has, however, continued to express its opposition to leaving the European Union without a deal. The Government agrees that leaving with a deal is the best outcome.
This impasse cannot be allowed to continue. In the UK it is creating uncertainty and doing damage to faith in politics, while the European Union has a legitimate desire to move on to decisions about its own future. That is why the Government has decided to take further action to seek a consensus across the House of Commons on the right way forward.
I therefore met the Leader of the Opposition earlier this week to discuss whether we might be able to agree a proposal that can be put before the House of Commons which allows the United Kingdom to leave the European Union with a deal.
We agreed follow-up discussions that are now taking place. I have also extended an open invitation to Members of Parliament more broadly to work with me to achieve a consensus that respects the result of the 2016 referendum.
I am clear that all of these discussions need to be based on acceptance of the Withdrawal Agreement without reopening it, as the United Kingdom agreed with the European Council at our last meeting, and should focus on the framework for the future relationship between the United Kingdom and the European Union. If a consensus is going to be found, compromise will be needed on all sides, in the national interest.
If the talks do not lead to a single unified approach soon, the Government would instead look to establish a consensus on a small number of clear options on the future relationship that could be put to the House in a series of votes to determine which course to pursue. The Government stands ready to abide by the decision of the House, if the Opposition will commit to doing the same.
These steps demonstrate that the Government is determined to bring this process to a resolution quickly. The Government acknowledges, however, that after approval to the Withdrawal Agreement is achieved, the process of enacting those commitments in domestic law and therefore ratifying the Agreement in the United Kingdom will take time. Therefore having reluctantly sought an extension to the Article 50 period last month, the Government must now do so again.
It remains the Government’s view that, despite this request to extend the Article 50 period, it is in the interests of neither the United Kingdom as a departing Member State, nor the European Union as a whole, that the United Kingdom holds elections to the European Parliament.
However, the United Kingdom accepts the European Council’s view that if the United Kingdom were still a Member State of the European Union on 23 May 2019, it would be under a legal obligation to hold the elections. The Government is therefore undertaking the lawful and responsible preparations for this contingency, including by making the Order that sets the date of the poll.
The process I have laid out in paragraphs 4 and 5 is designed to bring the House Of Commons to rapid approval Of the Withdrawal Agreement and a shared vision for the future relationship, and to allow the Government to introduce the Withdrawal Agreement Bill and so ratify the Agreement.
An important part of that process will be the Government agreeing with the Opposition a program for the Bill. The Government’s objective is to ensure that this program means the Bill can complete its passage such that the Agreement can be brought into force and the United Kingdom withdraw from the European Union in time to cancel the European Parliament elections.
I am writing therefore to inform the European Council that the United Kingdom is seeking a further extension to the period provided under Article 50(3) of the Treaty on European Union, including as applied by Article 106a of the Euratom Treaty.
The United Kingdom proposes that this period should end on 30 June 2019. If the parties are able to ratify before this date, the Government proposes that the period should be terminated early. The Government will want to agree a timetable for ratification that allows the United Kingdom to withdraw from the European Union before 23 May 2019 and therefore cancel the European Parliament elections, but will continue to make responsible preparations to hold the elections should this not prove possible.
It is frustrating that we have not yet brought this process to a successful and orderly conclusion. The United Kingdom Government remains strongly committed to doing so, and will continue to act as a constructive and responsible Member State of the European Union in accordance with the duty of sincere cooperation throughout this unique period. I would be grateful for the opportunity to update our colleagues on the position at our meeting on Wednesday.
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Apart from showing increased support for Theresa May’s Withdrawal Agreement which made it more popular than any other option that Parliament had so far voted on, the vote last Friday changed very little: it did not resolve the Brexit dilemma of a majority Remain Parliament reluctant to legislate to leave the EU as instructed by the electorate; it just kicked the can down the road. So far, Parliament has avoided the stark choice that it ultimately has to face: respect the referendum result and enact Brexit or revoke Article 50 in direct defiance of the result of the EU referendum.
Everyone who campaigned for Leave, regardless of their political background, expected a clean unadulterated Brexit once the people voted to Leave. However, the make-up of the Cabinet, the Government and Parliament does not make that possible. The Withdrawal Agreement remains the only practical way of leaving the EU. This is beginning to gain support from many MPs who are worried that any other course of action would risk Brexit itself. Such support came too late to have a decisive impact on the vote on 29th March and in most cases was too apologetic to provide the necessary backbone to push the deal through.
But we can now expect a final showdown as the deal is bound to come back in one form or another for a vote before 10th April when the Prime Minister is due to go to the special meeting of the European Council called by Donald Tusk to discuss Brexit, just a couple of days before the new departure date of 12th April.
And we must remember that while Brexit is a one-off event, post-Brexit is a process; it is the start. Theresa May’s deal may not be the ideal start, but it is a start that allows us to move on in a direction of our choosing.
Labour’s excitement at the sight of a Tory Government in meltdown is understandable. The prospects of a general election have suddenly been revived. Labour cannot be blamed for pushing for a general election, after all, it is what an Opposition is there for. But a general election before we leave the EU is the last thing it needs; Labour, having voted against the only deal on offer, would be labelled as the party that blocked Brexit and rightly so. No matter how popular its domestic policies are, that label would stick; Labour’s natural supporters would desert the party in droves.
Labour must do better if it is to avoid being branded anti-Brexit and untrustworthy. In its 2017 manifesto, Labour promised “to respect the result of the referendum” and stated that “the freedom of movement would end once we leave the EU”. What would puzzle Labour supporters is how the party can square its infatuation with ‘a customs union’ with its promises to revive British industry through state aid, ending freedom of movement, public ownership and public control of the railways, water and other major utilities, and negotiating our own bespoke trade deals – not to mention the promise to follow procurement policy that will benefit British firms.
It’s one thing to throw out the deal in the full knowledge that you’ll have another chance to vote on it; it’s quite another to do so in the knowledge that it will lead to a prolonged delay, participation in an election to an institution we voted to have nothing to do with and a real danger of no Brexit.
Nothing less than Labour’s credibility – and specially that of Jeremy Corbyn – is on the line. The Labour leadership must ensure, in whatever way, that Brexit is not halted either through a long delay or, for that matter, an outright revocation of Article 50.
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“It’s time now to cut them some slack, to cut the British government some slack, when it comes to their request for an extension and when it comes to their request that the Strasbourg Agreement be ratified formally by the European Council over the next two days.”
When Leo Varadkar took it upon himself to make the above announcement yesterday, I was met with the familiar feeling of déjà vu. I was immediately reminded of the Taoiseach’s antagonism over the Northern Irish border in January. Not much has changed in his attitude since then, only this time he undercut Mrs. May’s integrity by announcing she would be addressing the British public last night.
This meddling, coupled with the antagonistic “cut them some slack”, is counter-intuitive for any progress on an acceptable Withdrawal Agreement and it is a disservice to many Irish people too.
Sadly, it has now become regular practice for Mr Varadkar to use media engagements to slight Theresa May and her Government’s approach to Brexit. It’s hard to determine what is the purpose of these slights. Personally, I feel he is opportunistically capitalising on public dissatisfaction with Theresa May to boost his own image.
A bit like Jeremy Corbyn, Mr. Varadkar is quick with a quip but slow on any real solutions. All he managed to achieve yesterday was to enrage both sides of the Brexit debate. With his underhand remarks and his big reveal that Mrs. May would be addressing the people, he was insulting the British people.
But why should this matter to the Irish public? Well, our relationship with the UK is unique, a troubled history exists but this doesn’t define our future? For the sake of the Irish in Britain and the British in Ireland it’s time our Taoiseach shows some respect to all involved in this Anglo-Irish relationship.
If anything, Varadkar’s behaviour yesterday will serve only one purpose, to kick our neighbours while they are down. Rather than coming across as suave and debonair, he is in fact damaging the future of Irish citizens, his citizens. Currently it is estimated that roughly 400,000 Irish-born citizens call Britain their home. Furthermore, almost 10% of British citizens can claim some sort of Irish heritage.
Coupled with strong trade relations – Britain accounts for 24% of food, fuel and other merchandise brought into the state according to the Irish Central Statistics Office – this should be ample evidence for co-operation. Alas not in the eyes of Leo Varadkar. As former Taoiseach Garret FitzGerald said in 1983, Britain is “our nearest neighbour and our natural friend”.
Finally, it is interesting to note how the beleaguered Mrs. May alluded to social issues, education and knife crime as she spoke to the public last night. She acknowledged their frustration and though her croaky considerations may be too little too late, at least she acknowledged her citizens.
The Taoiseach seems to have forgotten who has elected him, or is this ignorance by choice? Perhaps he has spent too long with Donald Tusk and is of the opinion that he too cannot be replaced by the public. However, the homelessness epidemic and the housing crisis in Ireland are nearing cataclysmic levels. So I would say to my Taoiseach, remember your citizens here and abroad and do your duty for them.
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Approaching “no deal” at the eleventh hour, as we may well now be doing, is clearly not ideal. It would have been much better if we had spent the last two years negotiating the Canada+++ free trade deal which was the logical outcome of the 2016 EU referendum. This would have enabled us to have had a smooth transition towards an inter-governmental relationship with the EU27, rather than the one based on political unity which the 2016 EU referendum rejected.
The alternative we are now facing is the Withdrawal Agreement or some variant of it, possibly after a protracted delay if Article 50 is extended. This may buy us some short-term stability, but at the cost of putting us in a desperately weak negotiating position in the future. It is therefore important to appreciate how much stronger our hand might be if we start from “no deal”.
First, we would not be obliged by a legally enforceable international treaty to pay the EU £39bn. This is not to argue that we should refuse to pay the EU27 a fair amount to cover our legal obligations. It would, however, put us in a position to ensure that the sum to be paid is what we really owe and not an inflated figure, as £39bn arguably is. It would also provide us with substantial leverage to ensure that we would be able to secure agreement to a fair trade deal in return for the money we are paying, which we should surely agree to pass over only when we know what we are getting in return.
Second, “no deal” would force the EU27 to resolve the Irish border problem. No one, including the Republic of Ireland, the UK or the EU27, wants a physical border. Everyone will, therefore, have to find a way of using technology, combined with AEO trusted trader status for major companies and exemptions for smaller ones, to manage the border without physical checks. Of course, this should have been planned long ago. Now it will have to happen.
Third, “no deal” would ensure that we were out of both the Single Market and the Customs Union and therefore in a position to push ahead straight away into negotiating free trade deals with the many countries which have already expressed interest in having FTAs with us.
Fourth, we would be able to start – without delay – negotiating with the EU a free trade deal which has already been offered to us on various occasions – by Donald Tusk, President of the European Council, and Michel Barnier, the EU’s chief Brexit negotiator. Politics tends to trump economics in the EU, but the huge balance of payments deficit we have with the EU27 – £96bn in 2017 compared to a surplus of £13bn with the rest of the world – must mean that EU exporters will press for continuation of as close as possible to frictionless trade between the EU and the UK. It would, in fact, be possible, under WTO rules, for the European Commission and the UK Government to agree to continue immediately with no tariffs and quotas. Because of their trade surplus, it would make even more sense for the EU27 than it would for us to agree this being done.
Contrast what could come out of negotiations on this basis with where we would be under the Withdrawal Agreement – stuck for two or three traditional years of ongoing uncertainty; stuck with paying £39bn with nothing concrete being provided in return; stuck with the Irish backstop; and stuck very probably with having to make more concessions – on fishing, Gibraltar, ongoing net payments and other issues – to get any sort of trade deal in place; and still half in and half out of the Single Market and the Customs Union, with all the obligations these entail, but with few of the benefits they provide which could not be secured by a free trade deal – and with no vote.
Of course, leaving the EU at the end of March 2019 with “no deal” involves risks of disruption and ill feeling. The probably short-term nature of these hazards, however, needs to be weighed against the years of humiliation which are in prospect if we have to negotiate our future on the basis of the terms of the Withdrawal Agreement. Falling back on “no deal” at the last minute may be far from ideal, but it seems hard to argue that it would not put us in a better negotiating position than any alternative likely to be on offer.
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A few honourable MPs aside, the Labour Party has now dumped its manifesto commitment on Brexit to respect the referendum result. It is now calling for Britain to stay in the EU’s customs union forever – which would effectively mean being locked into the EU forever while having no say at all over how it works.
Say what you like about Theresa May’s negotiating skills, her task would anyway have been nigh on impossible given the continual attempts at sabotage from politicians and others in Britain.
One example: when May went to Brussels last week, she was told by Donald Tusk that Jeremy Corbyn’s proposals for a permanent customs union represented “a promising way out” of the current impasse on Brexit.
Another form of sabotage is the constant exhortations from the establishment calling for the EU to give no ground to the Government.
Brexit is in danger. A clean Brexit is still the default position, leaving on 29th March to trade on WTO terms. Yet despite the defeat in parliament on 29th January of every binding amendment to block or delay Brexit – including Labour’s permanent customs union – Theresa May’s so-called Withdrawal Agreement is still on the table.
Even though MPs voted against it on 24th January, May still wants MPs to vote again on it, once again using No Deal as a threat not as an opportunity.
Her current deal with the EU is not a Withdrawal Agreement – it is a Remainer Agreement, in every clause on every one of its 585 pages. It is No Brexit. It would bind us forever into a United States of Europe.
It is meant to be permanent, inescapable. The Attorney General told the Cabinet that there was no legal escape route from the backstop Protocol and that it would “endure indefinitely”.
Her deal would give the EU tariff-free access to our market and control of our trade policy, force us to fund the EU’s defence programme, give EU fishing vessels free access to our waters, give the EU control of our farms, and allow free movement of labour through clauses about “mobility”. In sum, it would bind us into the EU in perpetuity.
No surprise, then, that Jean-Claude Juncker, the President of the European Commission, boasted that the EU got “almost everything” it wanted with the deal.
MPs rejected May’s deal – almost the only thing they can agree on – then voted to tell her to go yet again to Brussels with her faithful lieutenant Oliver Robbins, to beg the EU to drop the Irish backstop.
But the EU will not give up the huge advantages they gain under the backstop. As Robbins observed, renegotiating the backstop with the EU is “for the birds”.
We do not need to beg the EU to change its position – that would be fruitless, as all experience from Harold Macmillan 50 years ago to David Cameron has proven. We do not need to beg the EU for a new deal, as Boris Johnson has suggested. We do not need to pay the EU £39 billion for the privilege of leaving, nor even the £20 billion that Johnson proposed.
We can and should just declare our policies on trade, fishing, the Irish border, immigration and everything else. We do not need to ask the EU’s permission. We declare our independence and then, if we wish, we can negotiate with the EU.
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What an extraordinary day it was in Brussels yesterday. Leading most of the papers today are the incendiary remarks made by European Council President Donald Tusk yesterday at a press conference alongside Irish Taoiseach Leo Varadkar. At the end of a relatively short statement, Tusk opined:
“By the way, I’ve been wondering what that special place in hell looks like, for those who promoted Brexit, without even a sketch of a plan how to carry it out safely.”
Never mind the deeply undiplomatic nature of the comment which unsurprisingly drew much criticism, it was also totally untrue.
While David Cameron and George Osborne may have irresponsibly refused to allow the civil service to prepare for the eventuality of a Leave vote in advance of the referendum, plans were drawn up by others. As Dr Lee Rotherham reminded us here on BrexitCentral in 2016, there was Change, or go – the seminal publication from Business for Britain which ran to more than 1,000 pages. Its subtitle, “How Britain would gain influence and prosper outside an unreformed EU”, provides the clue to it being exactly what Tusk claims did not exist.
Or there was the 2014 publication, Cutting the Gordian knot: A road map for British exit from the European Union, written by Rory Broomfield and Iain Murray. There were many others too.
There’s no way that this was an off the cuff intervention from Tusk. It was clearly planned. If you watch him making the remarks on our video, you can see him referring to written notes while he said it. And he then happily tweeted the words out afterwards – prompting an equally inappropriate response from MEP Guy Verhofstadt.
And then to rub salt into the wound, at the end of the press conference, Varadkar is caught saying: “They’ll give you terrible trouble in the British press for that”, to which Tusk replies: “Yes, I know” and laughs.
What on earth was he thinking???
Moreover, many of us had already been offended by some of the earlier contents of Tusk’s short statement. Aside from the contradiction of declaring the Withdrawal Agreement “not open for re-negotiation” while demanding that Theresa May offer a “suggestion on how to end the impasse”, the former Polish Prime Minister also reminded us of the EU’s arrogant attitude to referendums which deliver the “wrong” answer.
Having claimed that “a very great number of people in the UK… wish for a reversal of this decision” to leave the EU, he lamented:
“The pro-Brexit stance of the UK Prime Minister and the Leader of the Opposition rules out this question… Today, there is no political force and no effective leadership for Remain”.
Some might say that the definitive result of the 2016 referendum rules out a reversal of the said decision. Call me old-fashioned, but when a parliament organises a referendum to ask the people a question, is it not duty bound to implement the answer it is given?
But of course, that’s not the EU’s way of doing things. When Denmark rejected the Maastricht Treaty in a 1992 referendum, they had to vote again in order to approve it. It was the same with Ireland and their Nice Treaty referendum in 2001. And when the French and Dutch electorates rejected the European Constitution in 2005, it was merely cosmetically repackaged as the Lisbon Treaty. And when the Irish rejected that in 2008, they had to vote again in order to give Brussels the answer it required.
All a salutary reminder that the EU is not so much undemocratic as anti-democratic.
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In the aftermath of Parliament’s rejection of the draft Withdrawal Agreement, there is a way forward for the Government which allows a smooth transition into a No Deal scenario after 29th March, if found necessary, and then allows the UK to negotiate its desired comprehensive Free Trade Agreement with the EU without having to impose tariffs or quotas in the interim. There is a mechanism to ‘manage’ a No Deal scenario; one that works within existing WTO rules, and that is not widely known about.
This is essentially an alternate transition or interim period, but within WTO rules without having to levy tariffs or (arguably) pay membership fees to the EU, but requiring some customs forms levied on the 7% of UK businesses (400,000 out of 5.7 million UK private registered businesses) that actually trade with the EU. This is the deal with the EU used by China, the USA, India, Australia and New Zealand for example.
These recommendations are based on my nearly ten years of experience as a member of the European Parliament’s International Trade Committee, working on EU trade deals such as those with Canada, New Zealand, India, South Korea, Japan and Columbia/Peru, and drawing on high level discussions I have had with senior trade representatives for the EU and the World Trade Organisation (WTO).
In the event of No Deal, there is a strong case to maintain preferential tariff and quota rates at zero between the UK and the EU for a limited period – thought to be around two years. There are a number of arguments for exemptions to what are termed ‘Most Favoured Nation’ (MFN) rules, which require the same treatment in terms of tariff rates and treatment between WTO members to avoid discrimination. They are:
1) It is to the advantage of fellow WTO members to minimise disruption between our two large markets, which would reduce knock-on impacts to their imports/exports to the UK or EU markets. WTO members have to show financial harm to justify objections to practices (or tariff schedules). Civitas calculate that £13 billion of tariffs would have to be levied on EU goods entering the UK and £5 billion on UK goods entering the EU Single Market if standard tariffs are levied under No Deal. This is one justification for keeping preferential rates of tariffs for a period whilst a full trade deal is finalised.
2) There are exemptions under National Security grounds such as over the issue of Northern Ireland, which the IEA have argued as a case for an exemption, but this is less appealing given its association with US and Russian cases for exemptions, such as over US tariffs on Chinese steel.
3) Exemptions to ‘Most Favoured Nation’ (MFN) rules under Article 24 of the General Agreement on Tariffs and Trade (GATT) 1947. This appears to be the most substantive argument. WTO rules state that preferential benefits, such as tariffs and quotas for goods which are more favourable than MFN treatment, may only be extended to another country if it is part of a customs union or a free trade area. The ultimate legal authority to grant such preferences is Article 24 of GATT , incorporated into the WTO regime when that body commenced operations in 1995.
Article 24 is helpfully the ultimate basis in international law for the existence of the EU itself as a preferential trading bloc, which grants preferential treatment to its members within the Customs Union.
If the UK accepts Donald Tusk’s offer of a free trade agreement along the lines of CETA+++ or what I propose as ‘SuperCanada’, then the UK and EU will be in the process of moving towards creating a free trade area – Tusk has offered a tariff and quota free deal plus services (whilst leaving the EU Customs Union) – so qualifies under this criterion.
There are two under-appreciated aspects of Article 24 which have direct relevance to our situation, and which provide reassurance.
Firstly, Article 24, para 3 states:
The provisions of this Agreement [i.e. the requirement to extend MFN treatment equally to all] shall not be construed to prevent:
(a) Advantages accorded by any contracting party to adjacent countries in order to facilitate frontier traffic
- This has direct relevance to the position of Northern Ireland, and our adjacent country of Ireland. Some commentators have claimed that a sensitive and appropriate management of trade which respects and upholds both the letter and the spirit of, for example, the Good Friday Agreement would be in some form an unauthorised infringement of MFN treatment. That claim is clearly untrue.
- There is also no obligation under WTO rules to erect a so-called “hard border” on 29th March. Government may continue discussions with our counterparts in Dublin to arrive at adequate and effective technological measures for the management of trade with minimal friction. You will have noticed the encouraging signs that the Irish Government already appreciates this fact. (See, for example, “Ireland has no plans for hard border after Brexit, says Varadkar”, from The Guardian of 21st December 2018)
- We can expect that there will be considerable international sympathy for measures which support the situation in Northern Ireland, and hence a reluctance on the part of third countries to lodge objections. Although given the sensitivities this should not be stressed too heavily, such an exemption falls into ‘National Security’ related actions.
Secondly, Article 24 not only authorises member states to operate lower/zero tariff free trade agreements, it also permits them to offer lower/zero tariffs pre-emptively during the course of negotiations. The relevant provision, Article 24 para 5, is worth quoting at length, with emphasis added to the critical wording:
Accordingly, the provisions of this Agreement shall not prevent, as between the territories of contracting parties, the formation of… a free-trade area or the adoption of an interim agreement necessary for the formation of… a free-trade area; Provided that:…
(b) with respect to a free-trade area, or an interim agreement leading to the formation of a free-trade area, the duties and other regulations of commerce maintained in each of the constituent territories and applicable at the formation of such free–trade area or the adoption of such interim agreement to the trade of contracting parties not included in such area or not parties to such agreement shall not be higher or more restrictive than the corresponding duties and other regulations of commerce existing in the same constituent territories prior to the formation of the free-trade area, or interim agreement as the case may be; and
(c) any interim agreement referred to in subparagraph… (b) shall include a plan and schedule for the formation of such… a free-trade area within a reasonable length of time.
(A WTO declaration, the Understanding on the Interpretation of Article 24, 1994, clarifies that the ‘reasonable period of time’ in para 5(c) will generally taken to be no more than 10 years.) I estimate based on EU trade deals to date, that a UK-EU comprehensive Free Trade Agreement could take around two years, especially given the unique reality that the UK is starting from a convergent position with the EU, with zero tariffs and quotas and with our laws and standards currently harmonised.
- If, before 29 March, the UK has reached an ‘interim agreement’ with the EU to pursue negotiations towards a comprehensive free trade deal, both sides would be permitted under WTO rules to continue with the present zero tariff/zero quota trading arrangements. There would be no disruption to the man or woman on the high street. No Deal would mean No Change, as the cost of goods would not go up.
- In the present situation the ‘interim agreement’ would not have to be an extensive document running to hundreds of pages. The schedule of items covered by the negotiations would be all goods, as already envisaged in our discussions with the EU. The plan which the document sets out would have to amount to little more than a timetable for regular meetings and an ultimate deadline, some years hence, by which point negotiations will have to be concluded.
- An ‘interim agreement’, then, need be little more than an agreement to continue talks – while also continuing zero-tariff and zero-quota trade on both sides – plus a deadline no later than 29th March 2029. I accept that the EU has so far declined to agree any deadlines (other than 29th March) but since the absence of a final cut-off point has been a major contributing reason for Parliament’s rejection of the Draft Withdrawal Agreement, perhaps the EU will now reassess that stance.
- Whilst legal challenges at WTO level might be expected from an unhelpful member, the reality is that any such challenge is unlikely to get to the WTO ‘court’ – its appellate body – for at least two years and possibly longer, and only if that body finds the UK non-compliant would any compensating actions be authorised such as tariffs. This is within WTO rules, and if any challenges arise a fully compliant Free Trade Agreement should already be in place by the time any appellate body were to meet. The EU is now under extreme pressure from EU27 industry and commerce who enjoy a £96 billion surplus with the UK.
- You will recall that the draft Political Declaration indicates the EU want to reach a comprehensive Free Trade Agreement with the UK on the basis of zero tariffs and quotas (see paras 17, page 5, and para 23, page 6) and extending to services (para 29, page 7). Those provisions are fully in line with numerous public statements made since the 2016 referendum by Donald Tusk, President of the European Council, and Michel Barnier, European Chief Negotiator – offering a CETA+++, or what I term a ‘SuperCanada’ trade deal, on 7th March 2018, 30th August and 6th October 2018.
It is significant that Heiko Maas, Foreign Minister of Germany, has already indicated a willingness to continue talks (see “Germany says EU ready to talk if UK rejects Brexit deal” on Reuters, 15th January).
This approach would continue the pre-29th March status quo in trading arrangements and patterns without interruption, justified by an explicit provision of the WTO regime. The possible grounds on which any third country could lodge an objection to this are extremely slight (unlike for schedule changes).
An ‘interim agreement’ would therefore be an important component of a ‘Managed No Deal’ outcome from 29th March. It permits trade between us and the EU to continue without tariffs or quotas under No Deal while creating a space for negotiations to be reset and recommenced on the basis of reaching a SuperCanada or CETA+++ trade treaty.
I urge the Government to now adopt this course of action, as it will mitigate the main impacts of a ‘No Deal’ Brexit and eliminate the task of having to assess and charge tariff rates on 19,753 MFN tariffs under the EU Customs Union, thereby substantially reducing friction at borders.
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The letter sent from Jean-Claude Juncker and Donald Tusk to Theresa May in the last 24 hours shows more clearly than anything else possibly could why the draft Withdrawal Agreement is fundamentally flawed: not only the lack of substance in the letter, which adds nothing new to the sum of human knowledge, but also the lack of any form of collegiate kindness or helpfulness to the Prime Minister.
When the Prime Minister addressed the 1922 Committee on 12th December, she assured colleagues that she would secure legally-binding wording to address concerns over the Northern Ireland backstop. Now we learn there will be no end date to the backstop or unilateral exit mechanism for the UK. So, yet again, the EU have let the Prime Minister down.
The lesson is clear: we need to vote down the Withdrawal Agreement by as large a majority as possible. Only then can we move on and either negotiate a new agreement (as David Davis argued at the weekend) or Leave without a deal on World Trade Organisation terms with a view to later negotiating a new relationship.
The Government and the Conservative Party must remain committed to delivering the result of the referendum, as repeated in our 2017 manifesto, which pledged to leave the Customs Union and the Single Market, accompanied by the declaration that No Deal was better than a Bad Deal. Otherwise, the credibility of our democracy will be thrown into chaos.
The draft Withdrawal Agreement does not respect the result of the referendum. The Government should be seeking to unlock the negotiations by returning to the Canada-style option offered by President Tusk, using the tried and trusted techniques and procedures so that rules of origin and customs checks are conducted away from the Northern Ireland border, to make unnecessary the hard border that everyone agrees must be avoided.
The backstop means we will be trapped under the thumb of the EU with no date to escape – and unable to strike trade deals. It means we would be trapped indefinitely as a satellite of the EU, obeying its laws without a say, unless the EU and its Member States gave permission for us to leave. The UK will be paying £39 billion – equivalent to £1,443 per household, or £60 million per constituency – and getting nothing in return. We will not take back control of our money, laws and trade. Remaining in the Customs Union is a breach of the 2017 Conservative Manifesto on which I and all my colleagues stood.
The backstop drives a regulatory barrier down the Irish Sea, severely damaging the Union and moving Great Britain and Northern Ireland further apart. This deal keeps the supremacy of the European Court over our own law and sells out the UK fishing industry, excluding them from any trade deal, and envisaging a deal where the Prime Minister trades away our fish in return for market access.
We remain effectively in the EU for an extendable ‘transition’ period, paying and accepting new laws over which we will have had no say. Unrestricted immigration of EU nationals will still be continuing for years after we leave. This commitment comes with no guarantee of a future trade agreement. Worryingly, this deal will deny the UK an independent trade policy while potentially keeping us out of existing EU trade policy. We would be cut off from the world with our trade and economy regulated from Brussels without any say.
So, let us be honest: the Withdrawal Agreement is a terrible deal – worse than Chequers, less popular than the Poll Tax and only one in five voters think it honours the referendum result. The only way to get a better deal for the UK is for Parliament to reject it and force the Government to renegotiate with the EU.
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- Britain might be facing challenging questions, but its political system is working just as it should