In August, the UK government began publishing its proposals on Brexit in “future partnership papers.” They provide the first substantive indication of the government’s vision of a post-Brexit Britain. The first paper concerns the customs union, the free trade area that harmonizes tariffs on goods; and the single market, a common market for trade, services, goods and people among most EU member states and some additional European countries like Norway. The second paper is on judicial cooperation in cross-border legal cases. Both have been widely criticized by experts.
From these two papers, what do we now know about Britain’s position on the terms of its exit from the European Union?
Britain will not be ready for Brexit by the two-year deadline
According to EU rules, Britain will be ejected from the EU in March 2019, two years after it gave notice of its decision to withdraw. This will happen regardless of whether renegotiations of its relationships with Europe are complete. There are at least 34 major policy areas that Britain and the EU must renegotiate. Any one of these issues would present a whole-of-government challenge that could occupy a government for an entire mandate, so the Brexit talks will be like renegotiating NAFTA 34 times over in a two-year period. With just five issues now under discussion after six months, it looks impossible for all issues to be resolved by the time Britain Brexits, by default, in March 2019.
Britain needs transitional arrangements
It is clear from the initial papers that a Brexit without successful renegotiation of Britain’s EU links would be disastrous. It would be like falling off a cliff edge with no safety net. Given the impossibility of completing negotiations in the next 18 months, the UK has acknowledged for the first time the need for transitional arrangements. Because the EU has refused to negotiate new relationships with the UK until Brexit is finalized, a transitional period is particularly important in the case of customs and tariffs. Without a transitional arrangement, the UK would be automatically subject to strict WTO rules, and given how long trade negotiations take, Britain would be years away from being able to negotiate its own better trade deal with the EU, let alone with other countries like Japan, Australia and Canada.
The customs paper essentially proposes replicating the existing customs union in all but name. This suggestion has been welcomed by the business community, as it would cushion a “cliff edge” Brexit. It does, however, raise a fundamental, existential question as to the purpose of Brexit. Given that both the August papers propose replicas of current arrangements, what exactly is the point of Brexit?
Translating rhetoric to policy is hard
The two papers are a first attempt to grapple with serious policy conundrums, none of which were even touched upon during the referendum campaign, which was dominated by rhetoric and emotional appeals. But it is clear the British government is still in the very early stages of understanding the impacts of Brexit and outlining its solutions. There are two particularly serious policy issues at stake.
First, a significant part of the Northern Ireland peace agreement (the 1998 Good Friday Agreement) relies upon a frictionless border with the Republic of Ireland (Eire). Britain’s withdrawal from the customs union would place customs and border agents on the border between Eire and Northern Ireland, jeopardizing the peace agreement. The customs paper puts forward the internally inconsistent position that Britain should leave the customs union except where it applies to the border with Eire.
The second issue is judicial authority and the resolution of legal disputes between parties in the UK and parties in the EU. Judicial and legislative sovereignty was a lightning rod issue during the campaign, but Brexit advocates never explained exactly how “refusing to be ruled by Europe” would work. The paper on judicial cooperation takes tentative steps down that path, yet it has to acknowledge that Britain will still be bound by some EU judicial mechanisms and case law.
Britain will have to pay the EU to carry out Brexit
It started with the infamous Brexit slogan on the side of a bus, promising the UK would take back the £350 million it was sending to the EU each week and use the money to fund the National Health Service. Yet in August, the government finally acknowledged that Brexit will cost the UK a great deal. David Davis, the Brexit minister, accepted the existence of a “divorce bill,” despite denying it during the campaign. The customs paper proposes that the UK would pay for a transitional customs union, for as long as six years. Speculation on the full divorce cost ranges from £36 billion to £90 billion to £185 billion.
Hard Brexit is impossible
Proponents of a “hard Brexit” are adamant that for a pure Brexit, Britain must leave the customs union and the single market as well as the EU itself. Since the referendum, the government has backed this view, saying that Brexit means leaving the customs union and the single market. Observers have noted that this isn’t necessarily the case, as a number of countries that are not in the EU are still part of the customs union or the single market. Now, in the customs paper, the government acknowledges that the UK cannot leave the customs union, in part because of the Northern Ireland peace agreement and in part because of the disastrous economic impacts.
In a keynote speech in January, Prime Minister Theresa May said that UK laws would be made, enforced and adjudicated solely in Britain. This issue was another integral part of a hard Brexit, and judicial sovereignty played heavily during the referendum campaign. The government’s paper on judicial cooperation represents another climbdown, acknowledging that European courts and EU-member courts will be able to adjudicate on British matters, and that Britain will be bound by European judicial decisions.
The first future partnership papers emphasize what was already suspected: that entirely divesting Britain of any link to Europe is impossible. The referendum was based on an emotional appeal to ethno-nationalism. It was a rhetorical campaign, largely devoid of policy or serious debate. Attempts to discuss policy solutions to the inevitable impacts of Brexit were met with hostility. Now the UK is playing catch-up to the EU, whose team is well prepared, well briefed and policy-minded. Britain will have more climbing down to do if it wants to see Brexit through. It remains to be seen how the government will communicate these concessions to the public.
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