This was always inevitable not only if the talks were to progress to stage two but if the UK was not to become an international pariah, untrusted in any future deal making whether with the EU or anyone else. It would have been quicker, and less profligate of good will in the negotiations, to have accepted this inevitability from the beginning.
Brexiters like Boris Johnson were fooling themselves in saying that the EU could ‘go whistle’ for the money. But, worse than that, they were fooling the public, who are now left with the impression that, somehow, the EU have extracted a payment which need never have been made or was not really owed, thus contributing to the further souring of the Brexit process.
But even having now accepted that the money will have to paid, Brexiters are still fooling themselves and the public. They do so in two ways. First, they (and for that matter many journalists) talk about this as the ‘bill for Brexit’. It isn’t. Nor is it the ‘cost of Brexit’, which will be – indeed already is – far, far higher. It is the last part of the bill for EU membership, entailing payments that would have been made at some time had Britain remained in the EU (it bears saying that some remainers, too, seem not to fully grasp this).
Second, and far more problematic, they are talking as if it is a payment for a future trade deal – and is in some way contingent upon the nature of that deal, so that the Brexit Ultras are threatening to vote down the payment if they are not happy with the trade deal. This is incorrect because all that the financial settlement does is to open the door to trade talks; it does not imply any particular outcome to those talks and does not preclude a ‘no deal’ outcome. Perhaps Brexiters think they are going to try to pull the same trick they did over sequencing itself when having insisted they would not accept the stage 1 – stage 2 sequence they did so at the start of the negotiations but, since then, have kept trying, and failing, to re-open the argument. As we have seen, that has not worked and nor will any attempt to revisit the financial settlement if the trade talks fail, or fail to deliver what Brexiters want (which seems likely as many Brexiters still seem to expect identical trade terms to being an EU member).
The reason for this is something very fundamental which Brexiters inside and outside the government are, again, fooling themselves about. They are now invoking the stock wisdom of EU negotiations – ‘nothing is settled until everything is settled’ – but it does not apply in this case because the Brexit process involves two deals not one. The exit deal will be between the EU and the UK as a departing member. The future terms deal will be between the EU and the UK as a third country. This little understood fact was recently spelled out (in passing) by Sir Ivan Rogers, the former UK Ambassador to the EU, in a lecture at Hertford College, Oxford. At best, there might be a ‘political agreement’ on the framework for a future trade deal as part of the exit negotiations; there neither can nor will be a legal agreement on the framework, still less the detailed terms.
A similar confusion is in evidence in the way Brexiters are currently talking about the Irish border issue, with Liam Fox amongst others arguing that no progress can be made until the terms of the final trade deal are known. There is, in principle, more truth in this than in the idea that the terms of the financial settlement are contingent on the trade deal but in practice it does not make sense either. It could only make sense if one possible final deal involved Britain staying in both the single market and the customs union* because only then could the existing border arrangements be maintained. But that scenario has been completely ruled out by the British government. So on this issue, too, Brexiters continue to fool themselves. This was illustrated in its starkest form on Radio 4’s The World Tonight yesterday when Paul Moss interviewed a DUP politician (whose name I did not catch). Moss asked if there was any existing model for how the border could be non-existent after leaving the single market and customs union. The reply – this really could not be made up – was that there was indeed a model: the current situation!
As with the financial settlement issue, the worst aspect of this doltish refusal by Brexiter politicians to engage even minimally with reality is that it so profoundly deceives the general public. In the end reality will bite as it always does, but Brexiters will have misled the public to believe that they have been bitten not by reality but by the caprice of the EU, with all the attendant bitterness that will bring. Anyone who reads this blog regularly will know that I think that leaving the EU is a disaster for Britain, an epic and unprecedented act of economic and, no less important, geo-political and cultural self-harm. But as the months go by what I find almost equally grotesque is the sheer boneheaded incompetence with which Brexit is being pursued.
There is a line in the classic political sitcom Yes, Minister (or it may have been in Yes, Prime Minister) where Sir Humphrey says to Jim Hacker: “if you are going to do this damn silly thing, don’t do it in this damn silly way”. It applies perfectly to Brexit, and that should be a matter of concern to leave voters quite as much as to remainers.