Brexit Britain’s ailing state

Although not the commonest of the taunts aimed at remainers at the time of the referendum, a recurring one was ‘don’t you think this country is capable of running its own affairs?” The obvious answer was that it was based on the false premise that the EU ran the country, and that EU membership was one way in which the country ran its own affairs capably. Nearly eight years on, it’s increasingly tempting to think that the answer to the question should simply be ‘no’.

Of course, that is partly because of the particularly useless, almost absent, government we are currently enduring. It’s a government with virtually no discernible policies or even ideas, and the most discernible, the frenzied desire to send some asylum seekers to Rwanda, is as morally grotesque as it is impractical. It’s a government which doesn’t even have any ideological coherence: notionally Conservative yet engaged in an endless internal debate about what ‘true Conservatism’ means. The sense of political decay is palpable.

That is accompanied by an equally palpable sense of a country in decay. That ‘nothing works any more’ has become a cliché. Introducing an article this week bemoaning how the country is “stuck” waiting for an election to somehow unblock things, Suzanne Moore captured (£) the everyday manifestation of this sense:

“Someone in the queue for the bus replacement service had had enough. The train was cancelled because of “rain”. There was little information about when and where this bus would arrive. Some were struggling with luggage and buggies. Many were muttering under their breath. This happened to me recently and it has probably happened to you, too. Every single person was saying to each other: ‘this is just how things are these days’.”

A state in decay

These quotidian experiences are not, of course, the most serious examples of decay. A swathe of official figures released yesterday show how on multiple measures poverty is rising, including that 18% of the population are now in absolute poverty following the sharpest rise in 30 years. Last year saw a 6.8% increase in homelessness, and a record high in the number of households in temporary accommodation. The dental crisis which is seeing people extracting their own teeth is now so longstanding that it is reported abroad with puzzlement as to how this can be happening in a G7 country. People are spending their life savings to have routine, but vital, operations done because NHS waiting times have become so long, again a situation which has been developing for years. The Food Foundation’s latest survey found that 14.8% of UK households experience food insecurity in January 2024.

These, and many similar examples that could be given, are not just irritations, they concern some of the basics of life: food, housing, medical care. They are instances of the many ways that ‘nothing works any more’, but that, in turn, is a sign of something deeper, the way that, as the journalist John Harris wrote this week, “the state is abandoning its people”. He was writing primarily about the impact of the cuts being made by the now effectively bankrupt council in Birmingham but also about the way that “squalor, mess and festering social problems are now seen as the norm” much more widely than Birmingham.

That may be most painfully evident in relation to the welfare state, broadly conceived, but there are even more profound signs that what is happening is not so much governmental incompetence or callousness as it is a wholesale crumbling of the state. Those signs include the now entrenched crisis in prisons and in the criminal justice system as a whole, and, this week, the latest news from the dysfunctional HMRC, which is to close its helpline for half the year, having utterly failed to solve its longstanding problems. A more trivial, but telling, example this week might be the report that the Defence Secretary was flown in a jet which lacked electronic protective equipment because the RAF could not afford to install it. For that matter, the ultimate reason why the government has got into such a mess over asylum seeking is the abject failure of the Home Office to create an efficient and effective processing system. These examples are significant because they relate to things which all but the most crazed libertarians recognize as the core functions of even a minimal model of the state.

So what has this to do with Brexit? It is certainly not the case that it is the cause of these problems. Many of them have their origins in the Austerity years, and some have been decades in the making. Some have been exacerbated by recent events, especially the Covid pandemic and its aftermath. Yet Brexit is part of the mix, in two senses.

The permanent drag of Brexit

One, which is now going to be a permanent fact of British economic and political life, is that our problems are going to get worse, and their solutions less likely, because the country is poorer than it otherwise would have been as a result of Brexit. I’m really not going to rehearse the evidence for that yet again. There is simply no honest way of denying it, even if there is room for debate about the extent of the impoverishment. Within that debate, wherever the true figure lies within the range of credible estimates, which run from long-term annual GDP being between 4% and 6% lower than it would have been, it represents an economically significant cost by historical standards. This isn’t a one-off ‘hit’, it is a permanent effect.

That’s not going to be changed by the bogus graphs and misleading, cherry-picked data which some Brexiters are still churning out. It’s not going to be changed by this or that piece of economic good news which may sometimes be genuinely attributable to Brexit. It’s irrelevant whether or not the damage is as extensive as some predictions claimed. It’s irrelevant whether other countries also have economic problems. And it’s irrelevant that it is not the sole cause of this country’s economic problems. It would be far better for Brexiters to say, if it’s what they think, that this is a price worth paying for Brexit. That would at least have an honesty to it, although it would entail admitting the massive dishonesty with which they campaigned for Brexit, a campaign that emphatically denied there would be any economic costs at all, and promised economic benefits.

So that is one issue, and unless or until there is a political possibility of reversing Brexit, this drag on economic growth, and what that means for the tax base and for public services, is a truth which just has to be accepted.

Brexit overload

The second way that Brexit is part of the mix is related, but different and more subtle. If what we are experiencing is a crumbling of the state, in the sense of its basic functionality, then that is in no small part because Brexit has simply overloaded the bandwidth or capacity of the state. That this would happen, and has been happening, has been obvious to many of us from the outset, but it is only really now that its full meaning is becoming clearer. This has been brought into focus by a recent excellent report from the UK in a Changing Europe research centre entitled Brexit and the State (hereafter, the UKICE report, which includes coverage of many relevant issues beyond those discussed in this post; see also Jonty Bloom’s discussion in the New European).

This state overload began in the period spent ‘doing Brexit’ in its most literal sense, that’s to say from the referendum in June 2016 through to the completion of the Trade and Cooperation Agreement (TCA) in December 2020. During that time, Brexit was self-evidently the major focus of politics, and of much governmental activity, at least until the arrival of Covid in early 2020. Brexit inevitably ‘crowded out’ other concerns and priorities, neglect of which might be regarded as one of its ‘opportunity costs’.

According to the UKICE report, following a period when civil service numbers fell, the referendum saw an immediate increase, so that there are now 100,000 more civil servants than there were then, with Brexit a key, though not unique, reason. Yet at the same time, as I’ve discussed many times on this blog, the relationship between politicians and the civil service deteriorated, at times to the point of almost open warfare, and this was entirely because of Brexit. So Brexit had a dysfunctional effect both in absorbing state attention and in disrupting the basic axis of its operation, namely the interplay of elected politicians and permanent officials.

At the same time, from the referendum right through until the present day, Brexit unleashed massive political and, at times, constitutional instability, the most obvious manifestation being the fact that there have been five Prime Ministers, four Tory leadership contests of varying extents, and two general elections. Not all of this was due to Brexit – a Johnson regime, under any circumstances would have been likely to generate scandal and instability – but none of it is separable from Brexit. That is obviously true of the chaos, and eventual demise, of Theresa May’s premiership, but no less so of the even more dramatic collapse of Liz Truss’s short-lived ‘true Brexit’ regime (£). Meanwhile, Tory factionalism and infighting, much of it related to Brexit, has been a constant feature of the post-referendum period, and is probably worse right now than it has ever been.

This political instability inevitably has consequences for the effective functioning of the state. If nothing else, it has meant very high levels of ministerial ‘churn’ with each change of leadership as well as between times. This applies to most government positions, but one striking example is the post of Housing Minister, which has had no less than thirteen incumbents since the referendum (although the present one, Lee Rowley, was one of the earlier holders), compared with four in the period between the 2010 election and the referendum. I highlight this example because, although it is a relatively junior post, housing is one of the most fundamental ways that the state is failing to deliver and a good example of how the UK is lagging behind other countries.

The other consequence of the political instability since 2016 is that even when issues other than Brexit have received political attention, and even where the problem of ministerial churn did not prevent consistent policymaking, the government’s capacity to pursue a policy programme was compromised. That was most obviously true after the 2017 election, when May lost her working majority, but, actually, it continued to be true after 2019 despite the government having an apparently healthy majority. For there have often been enough actual or potential rebels to force the government to dilute or abandon policies, not least because at the root of the Tory factionalism is a profound dispute about the actual meaning of Conservatism. 

The strain on state capacity

Apart from the general way in which Brexit has overloaded the state, it has also occurred in the more specific sense of the state taking on all of the new activities and responsibilities that had hitherto been undertaken by the EU. These include the operation of the much-vaunted independent trade policy, as well as the repatriation of the regulatory functions of the EU. Taking back control may have been a fine-sounding slogan, but in practice it means a massive amount of fiddly, boring, but vital administrative effort, which is also part of the reason for the increase in civil service numbers.

It is now abundantly clear that Brexiters did not have the remotest idea that this was the case, or about how to undertake it. That is an outgrowth of their central failure, which has dogged the entire Brexit process, to specify even the general outlines, let alone the detailed mechanics, of what Brexit actually meant. This would have been bad enough, but they compounded that by their paranoid insistence that Brexit had to be done as quickly as possible, despite the fact that much time was wasted by all the Tories' internal conflicts and leadership changes, thus resisting every extension of the Article 50 process and eventually making any further extension impossible. It is hard to escape the conclusion that this was because they realized that, as the meaning of Brexit became clearer and public support for it fell, there was always the possibility that the political impetus to abandon Brexit would prevail.

There was not even that rationale, reprehensible as it was, for their initial resistance to even the idea of a transition period, and refusal to extend the short transition period that there was, despite it coinciding with the major crisis caused by Covid. By then, Britain had left the EU and Brexit was assured. As I wrote at the time, the demand to extend the transition period wasn’t the last stand of remainers, it was the first chance for Brexiters to show that they could govern post-Brexit Britain. They failed the test and, in doing so, not only made the Brexit process even more damaging than it needed to be, they also undermined capacity to deal with the pandemic.

Perhaps the most obvious consequence of this mixture of ignorance, dishonesty, and irresponsibility has been the multiple postponements to the introduction of import controls, which still hasn’t been fully completed. The UKICE report also highlights the unresolved issues of the EU settled status (EUSS) scheme and the farm payments scheme. On regulation, there is a long list of new agencies that have had to be created and staffed, some with long and ongoing implementation periods. There are far too many to itemize here but many of them have been discussed in previous posts.

It is important to stress that, whilst burdensome, almost all of this new activity for the British state is also unproductive and pointless. Some of it, such as import controls and EUSS, is extra cost to do things which would not have needed to be done but for Brexit. Much of it, especially the new regulatory agencies, is unproductive not, as Brexiters would have it, because it is unnecessary bureaucracy – on the contrary, for the most part it is vital bureaucracy – but because it simply replicates what the EU was doing anyway. For reasons discussed endlessly on this blog, regulatory ‘independence’ is largely chimerical.

The structural weakening of the state

So all that has been achieved is the ‘freedom’ to pay more to have, at best, the same regulation but, more often, less effective, more clunky versions of the same regulation. The issue here isn’t so much the financial cost – the staff and other budgets are not, in the scheme of Brexit costs, huge – but the poor functionality of what has been created. This is partly a result of the difficulty of recruiting staff with the necessary skills, but even if that were resolved it would leave the bigger difficulty of the structural deficiencies of UK-specific regulatory infrastructure. An important example, which I’ve discussed in the past, is that however well-staffed and effective UK food safety regulators may be, the structural fact that they are not fully hooked in to the various EU databases and agencies means that they can never reduce health risks to the same extent as was the case before Brexit.

To all this can be added the confusing mess left by the attempt to expunge retained EU law which, again, was driven by Brexiter impatience and dogmatism. In the event, the chaos that would have been caused could not be ignored even by Brexiters like Kemi Badenoch, who ended up with responsibility for the legislation when Rishi Sunak became Prime Minister, and so it was substantially watered down in what became the Retained EU Law (Revocation and Reform) Act, 2023. This climb-down was a relatively pragmatic piece of damage limitation. Nevertheless, as a Bar Council briefing note earlier this month explained, it has left substantial areas of uncertainty in fundamental areas of the law, something compounded by the lack of detailed parliamentary scrutiny of the legislation.

The consequences of this will play out over several years, as issues arise for the first time in what, in many cases, will be complex and highly technical areas. How extensive these consequences will be is impossible to say. Indeed, as the briefing puts it: “a central part of the problem is that no one yet knows quite how much of our law has been thrown into question by this new legislation” [emphasis added]. In terms of the theme of the basic functions of the state decaying or crumbling, there could hardly be a more potent example than the uncertainty about the law that governs us which Brexit has created.  

An ailing state

No country is, was, or could ever be, perfect, and the UK certainly isn’t alone in facing numerous problems, including problems of state capacity and effectiveness. But the now widespread sense of decay and failure here isn’t an illusion, as shown by how we are seen abroad, for example in a powerful short film just made by Annette Dittert of Germany’s ARD TV. It shows not just poverty and desperation but, tellingly in relation to this post, notes that “the state has long since disappeared from people’s lives here” (at 6.50). Or as the Telegraph’s Assistant Editor, Jeremy Warner, wrote this week (£):

“People sometimes come up to me at conferences abroad and ask, with faux sympathy, what has become of our country, which is now frequently characterised as almost third world. This may be a gross exaggeration, though scarcely so to judge by the mounting litter in my neighbourhood. In any case, you’d be a fool to think there wasn’t at least something in it.”

The UK is not a “third world”, failed or even a failing state, and it would be insulting to the many people around the world who have to endure in such states to say otherwise. But it could reasonably be called an ‘ailing state’, increasingly unable to meet the basic expectations of what a rich and technologically advanced country should be able to deliver to its citizens.

Brexit isn’t the only or even the main cause of that, but it does seem increasingly obvious that Brexit is not so much the straw that broke the camel’s back as the addition of a crushing, new, and permanent burden upon what was already a struggling beast, and has put leaden shoes on to its feet into the bargain. In this sense, although the UKICE report identifies many of the features of this new burden, I think there is more at stake here than its overall conclusion that “the post-Brexit state is still very much a work in progress”, whilst true in itself, suggests. The question is, more, whether there is a viable post-Brexit state at all.

Is there a remedy?

In the first instance, that is going to be a question for the expected Labour government. There’s certainly a good chance that at least the Brexit-induced political instability since 2016 could end, which is arguably a justification for Labour’s unwillingness to re-open the fundamental issue of Brexit. There’s also a good chance of some possible easements to the regulatory burdens of Brexit.

One early opportunity will be linking the UK and EU Emissions Trading Schemes so as to avoid the looming “regulatory nightmare” of the EU Carbon Border Adjustment Mechanism (CBAM) that the Financial Times reported on this week. Quick delivery of the SPS agreement Labour have committed to will be another. Whilst it’s widely observed that such moves won’t make a huge economic difference, they, and Labour’s evident commitment to ‘alignment’ as a default, would partially address some of the issues of Brexit overload of the state. That would speak to the need for a post-Brexit strategy, but would not address the deeper structural and systemic problems of the ailing state.

Warner suggests that radical planning reform, a central Labour pledge, offers the only obvious solution. That may be true, but it shouldn’t be underestimated how controversial it will be. Still, it is at least an example of something which only needs political will, rather than a lot of money.  Also in that category, and potentially addressing the more fundamental issues, is Labour’s commitment to reforming the machinery of government (£), and to constitutional innovations like Citizens’ Assemblies. In a climate of fiscal constraint, such initiatives could at least give a sense of momentum and progress, and the public some much-wanted hope of better times to come, though delivering on them – and doing so in ways which clearly improve everyday life – is quite another matter.

How all this plays out remains to be seen. So, going back to the Brexiters’ taunting question, ‘don’t you think this country is capable of running its own affairs?”, the answer is still in the balance. But if it turns out to be that we are, it will have been achieved despite Brexit, rather than because of it.

Correction (22/03/24, 10.00): In the post, I state that the HMRC has decided to close its helpline for half the year. In fact, having announced it, the HMRC reversed that decision a couple of days later. However, the ongoing issue of poor service levels remains.

I will be taking a break from blogging over Easter and so, unless there is a major development, the next post will be on Friday 12 April.