Sorry, the next phase of Brexit will be even less joyful
“Where will it end? Where will it end?’ So went the desperate pleas of Ian Curtis in Joy Division’s harrowing song “Day of the Lords”. This song often pops into my head these days when I think about Brexit, a political endeavour that once inspired excitement about the potential for change, reform and renewal, reduced to an agonisingly tedious process exposing numerous inadequacies in our political system.
I used to argue that although the eventual passing of the Withdrawal Agreement was merely the “end of the beginning”, we could at least look forward to Brexit not being quite so all consuming. My logic being that when our membership officially ends, a degree of acceptance would sink in and the negotiations on the future relationship wouldn’t dominate the news and the political agenda. Now I’m not so sure.
When Boris managed to get the Withdrawal Agreement amended, and a small majority on the second reading of the Withdrawal Agreement Bill, there seemed to be a light at the end of the tunnel signalling that the first phase is nearly over. Alas, the light is flickering. Boris wants a December election to seek a majority to get Brexit done but Labour are flirting with the idea of whipping MPs to abstain. So, no election, another extension, and months more of political deadlock.
Where will it end? Where will it end?
This tedious Brexit purgatory has gone on so long now that there are even some remainers yearning to be free from political stasis, even if it means Brexit happening. Please, make it go away. “Get Brexit done” is a seductive slogan for exactly that reason, but it won’t be long before it rings hollow. The Withdrawal Agreement ends the nightmare of Brexit phase one, but we’ll be wading through quicksand again in no time. There are many political battles to come and they will dominate our politics for years to come.
As Germany’s Chancellor Angela Merkel said: “The second stage […] is undeniably going to be more complicated than the first stage.”
The negotiation of the future relationship will be far harder than the Article 50 debacle. The EU is going to have a long list of objectives from Member States and far less scope to compromise, this wish list will almost certainly contain many politically contentious issues for the UK government to deal with. The negotiations will be far broader and will involve many more technical details. This will all take place with a backdrop of an unstable political climate in the UK in which half the country, including a great many MPs, didn’t want to leave the EU.
If you enjoyed the arguments about extensions and financial settlements, you’re going to love British politics in 2020. Under the terms of the Withdrawal Agreement, a decision to extend the transition period must be adopted by mutual agreement by July 1st, 2020. There will inevitably be disputes over the extension, and we’ll face painful new financial negotiations. The current £39bn Brexit divorce settlement, which so angered hardline Brexiteers, only covers us until December 31st, 2020.
Extending until December 31st, 2022 will require further payments. This row is going to kick off around Spring next year. Oh joy.
Once the new government works its way through that quagmire, the real battle for Britain begins. The debate about the nature of our future relationship with the EU hasn’t ended. Although the political declaration sets us on a path to a loose relationship, with Boris aiming for a “Canada style” FTA, it’s merely a baseline and isn’t set in stone.
If the Conservatives gain a workable majority from an election, they would have more scope to shape the relationship as they wish, but they wouldn’t have a free hand. The Labour Party, the Liberal Democrats, the Green Party and the SNP all want a closer relationship than Boris is aiming for and are unlikely to give up their resistance. Let the parliamentary shenanigans, begin!
When attention shifts fully to the future relationship, the realisation will sink in that the kind of Brexit Boris is seeking is very much of the “hard” variety, to a much greater extent than the course set by Theresa May. As the scrutiny increases and MPs begin to learn more about trade, questions will be asked, and objections will be raised.
Boris is aiming for a basic Free Trade Agreement, which is an outline framework for trade. It represents a major downgrade of our relationship with the EU. Whether one thinks this objective is right or not is immaterial, it’s just a fact. Boris’s deal will mean services companies will have little access to the Single Market, but unlike Theresa May’s proposal, it does not contain a “single market for goods” either. This means manufacturers will be excluded from the single market too.
Boris has rejected the idea of regulatory alignment and will resist robust level playing field provisions so it seems unlikely that the EU will agree to a zero-tariff arrangement. There will be increased regulatory and customs checks, and tariffs to pay, the costs of trade will increase.
Expect major objections to be raised from industries across the board, especially automotive, pharmaceutical, aerospace, food processing, agricultural and chemicals. They are unlikely to remain silent as their integrated supply chains are disrupted. Any relocations, closures or financial losses will be big news.
The Conservatives envision Britain opening new export markets, broadening trade partnerships with key allies and deregulating and diversifying its economy. It’s not a vision that the other parties are going to buy into, and they will likely resist every step of the way.
I’m afraid we are are heading for years of difficult negotiations with the EU when there is no consensus in the UK about what constitutes a good outcome. The conclusion will be a trade agreement that has to pass through parliament to be ratified. Even a government with a majority will find all this difficult to navigate. If we end up with another hung parliament we are going to be wallowing around in this mess for years.
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