Category Archives: European Union

Britain, Economic, European Union, Government, Ireland, Politics, Society

Brexit always leads back to the issue of the Irish border

BREXIT: UK – IRELAND

ONE of the most persistent myths about Brexit is that the Irish border issue was bounced on to an unsuspecting British prime minister by her cunning – or, perhaps, reckless – Irish counterpart. According to this narrative, Theresa May signed up to the December 2017 agreement that committed the UK to avoiding a hard border on the island of Ireland without fully understanding the implications because she was desperate for a transition deal.

Yet, what has become clear since is that the necessity of avoiding a hard border on the island of Ireland matters as much to Theresa May as it does to Leo Varadkar. Just as no Irish prime minister could ever agree to the renewed partition of the island, Mrs May remains determined not to be the British prime minister who presided over the restarting of the Troubles, still less the disintegration of the United Kingdom.

The British government may have been slow – some might say shamefully slow – to appreciate what was at stake, but it is the Irish border issue, rather than the demands of business, that now drives Mrs May’s entire Brexit policy, as expressed in her Chequers proposal.

But the fact that Mrs May is no less sincere than Mr Varadkar in her desire to keep the border open doesn’t make a solution any easier.

As things stand, the Irish border is the single biggest obstacle to an orderly Brexit and the two sides are as far apart as ever. EU officials say that no progress whatsoever has been made since March in negotiations over the backstop that Mrs May agreed in December. The withdrawal agreement was to ensure that no hard border emerged regardless of the future trading relationship between the UK and EU.

The EU insists that there can be no withdrawal agreement without a functioning backstop. The UK is adamant, however, that the problem can be solved only via a framework trading relationship that makes a backstop unnecessary. Hence the Chequers plan for a “facilitated customs arrangement”, which would see the UK pursue a dual-tariff system, collecting EU tariffs on the EU’s behalf for imported goods for the EU market, but charging only UK tariffs on goods destined for the UK market; and a proposed “common rule book” covering trade but not services.

Neither side shows the slightest sign of budging. Mrs May continues to insist that the EU’s backstop suggestion would amount to introducing a border in the Irish Sea, which she says no UK prime minister could accept. Downing Street believes that Brussels is badly underestimating the degree of cross-party support for its position. Officials note that an amendment to the EU Withdrawal Bill tabled by Jacob Rees-Mogg ruling out a customs border in the Irish Sea was accepted by the House of Commons without a vote. Downing Street argues that the only way to unblock the situation is for Brussels to drop its opposition to Chequers.

EU officials have countered and have said Mrs May is underestimating opposition to her proposals across the European Union. Brussels is also baffled by the UK’s position on the backstop. EU officials have pointed out that some checks already take place at Northern Irish ports and airports and that the EU’s proposal simply would build upon them. Indeed, civil servants in Northern Ireland produced a draft paper this year in what they dubbed a “Channels” approach, under which goods entering Northern Ireland from the UK could pass through either a red or green channel at ports or airports depending on whether those goods were destined for local consumption or export to the EU. Such a system would depend on some level of risk-based checks combined with appropriate documentation, cross-border cooperation and tough penalties for infringements. The paper concludes that such “a pragmatic extension of present reality . . . seems infinitely preferable to a return to the border of the past”. Yet the UK government has blocked publication and refuses to share with Brussels any underlying data on volumes of goods entering Northern Ireland.

Of course, how this situation plays out will in part be determined by how all sides perceive the consequences of a no deal. Both the UK and Ireland would be hit hard economically. The IMF estimates that both would suffer similar hits to GDP of about 4 per cent by 2030, although Ireland’s far higher rates of growth would make such a shock easier to absorb. British officials believe that Mr Varadkar would pay a political price because he has done little to prepare public opinion for the prospect of the EU at some point obliging Dublin to start introducing customs and regulatory checks at the Northern Irish border, something Britain has said it would not do. But while Dublin is convinced it would win any blame game, the bigger risk may be to the UK. After all, the case for allowing the people of Northern Ireland to decide their own fate before any border checks were imposed and as provided for under the Good Friday Agreement would surely be strong. A recent poll published earlier this month suggested that a majority of Northern Irish under such circumstances would vote for reunification by a margin of 52 per cent to 39 per cent.

The risk for Mrs May is that the very outcome that her entire Brexit policy has been seeking to avoid will have come to pass. A political paradox if there ever was one.

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Britain, European Union, Government, Politics, Society

(In Brief) What are the UK’s Brexit Options?

BREXIT

The Chequers Plan – The Prime Minister has made clear that her July 2018 blueprint remains Britain’s negotiating position and expects her ministers in Cabinet to promote it.

But officials at No 10 know that if the EU continues to stonewall, the internal Tory Party voices who have never liked the deal will only get louder. The agreement would see the UK collect tariffs on behalf of the EU and follow a “common rulebook” for goods but not services.

Canada – Canada’s free trade deal with the EU came into force last October, following seven years of negotiation.

It grants preferential access to the single market without signing up to the EU’s four fundamental freedoms – goods, services, capital and labour.

It removes 99 per cent of customs duties and trade tariffs, but it would not give British financial services the access to the EU market they currently enjoy and does not solve the Northern Ireland border question.

Norway – Under the Norway model, the UK would sit alongside Norway, Iceland and Liechtenstein as part of the European Economic Area (EEA).

It would give Britain the freedom to strike trade deals with countries around the world. But free movement of people would continue, which would be unacceptable to many Tory Eurosceptics.

No Deal – The nuclear option. But the Prime Minister has repeated her pledge in the last few days that “no deal is better than a bad deal”.

Britain would make a clean break from the EU and fall back on its membership of the World Trade Organisation. It could also save Britain paying the £39 billion “divorce bill”.

Blind Brexit – This would involve a vague November statement on future trade in a bid to finalise the divorce payment and transition deal. The details of the future trading relationship would be sorted out at an unspecified later date.

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Britain, European Union, Government, Politics, Society

Brexit: The last chance to restore trust

BREXIT BRITAIN

HAROLD WILSON once said a week was a long time in politics. In the present political climate, weeks must feel like eternities. Brexit has changed people’s views as the debate has raged on. For some, who were once moderate party members, have turned into hardened rebels; others who initially supported the Government’s approach now have real concerns about its direction.

Yet, the key conversation we should be having – one that has really been absent for too long – is what the next 15 or 20 years will look like; what we should actually do now, beyond the platitudinous slush, to ensure that the children of today and tomorrow can have a better life than us.

Deep down, our politicians must know that there is something amiss in the body politic of today. Populations are restless. People feel left out and ignored. The traditional levers to improve the world are malfunctioning – there is slower growth, foreign policy chaos and domestic budget stricture. The status quo appears brittle and worn. Where is the clarity about what to replace it with? The world is turning, and, for many, it appears to be turning away from them.

Underneath that sense of foreboding are two existential issues. The first is technology. In the lifetime of those born in the 1960s have seen the advent of the home computer, the internet and the mobile phone. Millions of jobs have been created by a medium that was invisible a generation ago and which, most likely, will have changed beyond recognition by the next.

Yet, even in normal times, politicians’ answer to technology is to either ignore it or grandstand on it. Take the tech giants and their questionable data practices. The elite have gone to town on them in recent months. CEOs have been chastened. Companies run warm adverts saying things like ‘we’ve changed’ without proper public consideration of what, over the long-term, we all need to change to.

The country’s focus on Brexit has meant we’ve missed the underlying, hard questions. Are they platforms or publishers? Are they monopolists or innovators? How do individual nation states regulate cross-border activity? The amount of time that politicians spend in legislatures debating the philosophical, economic and social impacts of artificial intelligence, big data and the loss of privacy is inversely proportional to their coming impacts.

There are many in parliament who are evangelical about technology and its ability to change lives. But surely, we have to ready citizens to take advantage of those opportunities through skills, flexibility and attitude. It is inevitable that there are huge potential changes coming, ones which will reshape our economy and our labour market. If these issues are not properly talked about, by preparing people to deal with them, we will be storing up tremendous problems for the future. We have to do much better.

This can all be reasonably predicted because it has happened before. The European Economic Community that Britain joined in 1973 was a very different beast to the EU we have part of since its expansion. Few people expected then that an economic union would also become a political one. Nor were most people aware or able to predict how fundamentally globalisation would reshape our economy and our communities. A lack of public consultation that forced through such massive changes had achieved a bipartisan consensus in Westminster. And it is this which brings us to the second existential issue for British politics: trust.

Those citizens who have borne the brunt of these radical changes feel ignored and patronised. Their security has been undermined and their way of life transformed. The years since the financial crash have been especially hard for many – to say nothing of the toxic cacophony of expenses scandals, dodgy dossiers, spin and the obscuring of hard choices. It seems to many that the system is now not only untrustworthy but also fundamentally rotten.

Against that backdrop, Brexit was an opportunity to restore that trust with a large section of society. By granting the referendum, our political class seemed to have recognised the need for a new democratic input – for some kind of check from the people of Britain on the consensus MPs had established. “The Government will implement what you decide,” said the booklet that dropped through every household letterbox, and many millions of voters believed it. Their decision was close but clear: Britain must leave the EU. The definition of that result was politically distilled, and the departure from the single market and the customs union has been cemented. In the general election of 2017, 85 per cent of people agreed.

Distrust and disengagement have now been replaced by curiosity. People hesitantly dared to hope that the political class was actually going to do something they requested.

Then along came Chequers. At a stroke, that emerging engagement with politics was dashed. Government spin proclaims that we are taking back control. The reality is that we are ceding it, at least on trade, in perpetuity. The document is a clever, legalistic, splitting-the-difference tome; the product of a process driven by a civil service never fully reconciled to leaving and, ultimately, not wanting to grasp the nettle.

Whatever we may think about the referendum, and whatever our own personal views on Chequers are, the key measure is one of trust. Does this proposal properly embody the decision of the British people in 2016? How is it sold to the disengaged or the exasperated? And, when this offer is salami-sliced away into irrelevance by the EU, what should the British people be told? That we gave it our best effort but came up short? That Brussels was right? That our political masters know best?

If Brexit directly leads to the jobs of truck drivers and call-centre workers being automated away without consultation or compensation, politicians here will not be forgiven. And if, after years of globalisation and European integration, MPs do not honour the pledge on which they hung their entire credibility, and implement the orders they had been given, politicians will lose the trust of the electorate for a generation.

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