Friday, 23 November 2018

Reflections on the Political Declaration

The road to Brexit is littered with numerous false claims, some the result of ignorance and others that were just lies. One example, which is a mixture of both, is suddenly in the spotlight as it has become generally understood that Brexit is a two stage process, one relating to withdrawal terms and one to future relationship terms.

How did we get here?

Of course anyone with even the most basic understanding already knew this, but from the outset it was obscured by leading Brexiters. Let’s not forget that before the referendum the Vote Leave campaign actually promised that the terms of a new deal would be negotiated before the legal process to leave was even begun. Subsequently, in December 2016, Boris Johnson opined that two years was more than enough time to complete “a great deal” and that in fact 18 months would be “ample”, a view endorsed by the ERG’s Bernard Jenkin.

As recently as January 2017 David Davis, the then Brexit Secretary, stated “I believe we can get a free trade and customs agreement concluded before March 2019”. This wasn’t just over-optimistic, it was plainly false by definition given the staging of the process. It was also Davis who said in November 2016 that “we’re not really interested in a transition period, but we’ll consider one to be kind to the EU”. Again, the implication was that it would all be wrapped up by March 2019.

This false claim lingers on in Theresa May’s insistence that the transition period always be called an “implementation period”, implying that there would be something to implement. But she certainly understood by April 2017 – although she appears not to have done so before – that the future trade deal would come after withdrawal, and would take a considerable period of time.

The Phase 2 failure

It’s important to disentangle this from the different, albeit related, issue of the sequencing of the Article 50 talks. The UK had always wanted to conduct talks about withdrawal and talks about future terms in parallel. It was to have been the ‘row of the summer’ of 2017 because the EU insisted that phase 2 talks on future terms could only start if there was ‘sufficient progress’ on the phase 1 withdrawal issues.

In fact, the UK accepted sequencing on day one of the negotiations (even though it was true to say that the Irish border issue straddles the two phases, and in that sense the EU’s position on sequencing was overly rigid and artificial). But even had the talks been in parallel rather than in sequence, it still wouldn’t have meant the trade and future terms deal could have been completed within the Article 50 envelope. It was always going to come afterwards.

Nevertheless, more of the groundwork for future terms could have been done as part of the phase two talks had it not been for two crucial issues. The first was that as soon as the December 2017 phase 1 agreement had been made the UK immediately resiled from it, with Davis saying that it was non-binding and May saying no British PM could agree to the backstop terms which she had, it had seemed, just agreed to. The second was that the UK government could not agree what future terms it wanted to seek, and did not do so until the Chequers Proposal of July 2018, which promptly imploded anyway. Thus nothing of substance happened in the phase 2 negotiations at all.

Where now?

The result is the vague, ambiguous and aspirational text of the political declaration that is now in the headlines. Some people object to the term ‘Blind Brexit’ on the grounds that, indeed, the future terms were never going to be fully known. But that misses the point that there are degrees of blindness: had there been more substantive phase 2 talks then the political declaration could have been more precise than it is. On the other hand, it is certainly disingenuous of Jeremy Corbyn, and others, to lambast the government for the fact that the detail of the future terms are not fully known, since in no circumstances would they have been.

What could be said – although Corbyn isn’t doing so because he remains opposed to single market membership – is that had the UK opted for soft Brexit in the form of EFTA/ EEA then we would have had a very good idea of what the future would look like. In that respect, I think that one politically significant part of the political declaration is the reference to respecting the result of the 2016 Referendum in terms of an independent trade policy and end to freedom of movement of people. This bakes into the future terms the hard Brexit interpretation of the referendum result, and although it is not binding it will serve to frame Brexit that way in all the years of wrangling to come, assuming the deal goes ahead.

This matters in relation to the argument made recently by the influential Brexit commentator David Allen Green. His core claim is that the only way to rid the UK of the 2016 referendum mandate is to discharge it and leave the EU. At that point, it will have no further purchase, Brexiters should cease to refer to it and erstwhile remainers should work towards a “close association agreement”.

In a post at the time I argued against that, saying that I thought it highly unlikely that Brexiters will drop the idea that the Referendum result mandates their preferred form of Brexit, or that they will cease to get traction from it amongst their supporters. It seems clear to me that they will be strengthened in that respect by having explicit reference to the referendum mandate in the political declaration.

May’s three tactics

Of course it remains to be seen whether any of this matters, since May’s deal may be voted down. Her tactics to avoid this are interesting. One, of course, is to insist that the only alternatives are no deal or no Brexit, the former to frighten remainers and the latter to frighten leavers. That may backfire if each group takes seriously the message meant for the other.

As regards the message meant for remainers, this tactic can only be bolstered by reports today of how some leading Brexiters in the cabinet plan to respond if the deal is voted down. Apparently, their idea is to seek a ‘managed no deal’ in which the EU agree a one year transition period after which the UK goes to WTO trade terms. There are so many holes in this latest fantasy that it is hard to know where to begin. It requires EU agreement (as usual, we are loftily told that ‘this would be in their own interests’) whilst refusing to accept any of the other things the EU needs from a withdrawal treaty and getting none of the things the UK needs; it has nothing to say about non-trade issues; it repeats the ‘WTO terms’ myths (see previous posts ad nauseam). It’s not hard to imagine that some people will think it better to line up with May’s deal than risk this kind of insanity.

The second tactic is to get business support for the deal. This has been partially successful, although the CBI support is fairly lukewarm and, as a leaked email shows, scarcely heartfelt. It is working better in Northern Ireland, though, where she now seems to have driven a wedge between the DUP and the business community.

This tactic reveals the shift in alliances that Ian Dunt predicted would happen once the deal was ready. Remainers have been used to having business almost unanimously on their side, but the interests of the two groups do not completely coincide. Many businesses are more interested in stability and predictability than in Brexit per se, and the deal gives a degree of this because of the two year or more transition period. And, alas for jobs, investment and taxes in the UK, one thing that period will give is time for businesses to relocate.

The third tactic is likely to be the most potent, but it is also the most dishonest. May’s central message is that the British people ‘just want this settled’. In that, she is undoubtedly right. I suspect that many, possibly most, people are heartily sick of the whole thing, and not much interested in the details. But in making this the promise, she is reprising the false claim that Brexit ends with the withdrawal agreement, whereas in fact that will just begin a new and much longer phase of negotiation. Those who are bored to death with Brexit are certainly going to keep hearing about it for many years.

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