Friday 12 April 2024

Britain's Brexit drift

It’s fair to say that Brexit has ceased to provide much in the way of drama. To use a cricketing analogy (and they are always the best ones), it is as if Brexit’s Bazball days have given way to the cricket of an earlier era, so that what we are now seeing is akin to Geoff Boycott (who, it’s relevant to say in this context, is both a keen Brexiter and Theresa May’s childhood hero) grinding out a painfully slow innings on a dead wicket. Such play as there is gets constantly interrupted by rain. The crowd got bored long ago, and are huddled down under macs and umbrellas. The captain, though as keen an enthusiast for cricket as for Brexit, has no strategy, no leadership skills, is despised by half the team, and will surely be replaced when the inevitable defeat arrives. Meanwhile, dreary, be-blazered bores chunter on about Lord’s being the home of a game that long since found its centre on the other side of the world.

And so we drift on.

Import controls and the common user charge

Probably the biggest piece of Brexit-related news over the Easter holiday was the government’s announcement of the ‘common user charge’ to be levied on imports of animal and plant products from the EU. This is the latest aspect of the much-delayed introduction of post-Brexit import controls, the next phase of which become operational at the end of this month. These in turn are part of the economic border with the EU which Brexiters swore would not be necessary because there would be some miraculous deal which ensured ‘frictionless trade’ without participating in the institutions which ensure frictionless trade.

The common use charge will add £29 to a consignment of an individual product line, so where a consignment contains more than one product line the charge will be multiplied by that number, up to a cap of five, making the maximum charge £145. This maximum is likely to be reached on many consignments because the kinds of products involved, many of which have short lives, are typically shipped in small quantities within a bulk assignment. However, it shouldn’t be thought that these are the only costs Brexit has added to importing from the EU. In some cases there may be health certificates to be paid for, in others duty or VAT to be paid. In all cases there will be the administrative costs of ensuring compliance.

The impact of all these costs will be very similar to what happened when the EU introduced controls in the other direction (i.e. British exports to the EU), on time, when the transition period ended. That is, small firms (£), trading smaller volumes of goods, with tighter margins, and perhaps no experience of international trade other than with the EU, will struggle the most and many will cease to trade at all. A study by Allianz Trade released this week suggests that the first year of these latest changes will add 10% to the costs of importing the products affected. Larger firms will be more able to ‘absorb’ these costs, but doing so doesn’t make them disappear, it just means they manifest themselves in other ways, including higher prices. It is one of the many ironies of Brexit that, before the referendum, we were told that it was decadent, globalist ‘big Business’ that opposed leaving the EU but that plucky British entrepreneurs couldn’t wait to be rid of ‘Brussels’ red tape’.

The common user charge only applies to goods coming through the Port of Dover or the Eurotunnel at Folkestone, and will be used, according to the government’s obtuse rhetoric, “to recover the costs of operating our world-class border facilities where essential biosecurity checks will protect our food supply, farmers and environment against costly disease outbreaks entering the UK through the short straits.” At least this statement clarifies one thing, which is that these checks do actually serve a purpose. It’s a point I’ve made repeatedly on this blog, but one which Brexiters like Jacob Rees-Mogg never understood, and fails to understand even now.

Food security and farming

At the same time, by confirming the purpose of checks, the government has tacitly admitted that its failure over the last three-plus years to operate full import controls has put the public at risk, which ought to be a scandal. And that scandal will not be ended once the controls are in place. The decision to use Sevington, 22 miles from Dover, as the main site for sanitary and phyto-sanitary (SPS) checks, means that, far from being ‘world-class’, the border will have a “gaping hole”, according to the head of the Port of Dover Health Authority, risking “illegal, unfit, dangerous, and diseased” products entering the country. Meanwhile, the Chief Executive of the Cold Chain Federation has said that it is becoming evident that the new Border Target Operating Model (to give the new “world-class border” its official name) is “broken” before it has even been fully implemented.

The lack, or inadequacy, of import controls is one of several Brexit-related complaints from British farmers which have led to recent protests, including a tractor go-slow outside parliament. Other complaints include the impact of the one-sided trade deals the UK made with Australia and New Zealand, and the ongoing failure to create a viable replacement for the Common Agricultural Policy (CAP). As with other instances of Brexit damage, Brexiters are keen to point to what is happening in other countries, in this case meaning farmers’ protests in the EU and elsewhere. And, as usual, this misses the point which is that whilst all sorts of countries, including this one, have such problems, it is only this country which has added Brexit to them.

In fact, agriculture, and the replacement for CAP in particular, serves as a case study not just of the damage of Brexit but of how Brexit has overloaded what in my last post I called Britain’s ailing state. Despite CAP having been a cause celebre for Brexiters for decades, policy since leaving the EU has been characterised by endless changes of direction and no coherent or consistent strategy, in part because of ministerial churn. The consequence, as Jill Rutter of the UK in a Changing Europe puts it in her review of this saga, is that “the people whose livelihoods depend on Defra decision-making are crying out for some stability in its ministerial team to allow them to plan long-term.”

The "death" of the London stock market  

There was a time when farmers, like fishermen, another of the Brexiters’ supposed causes, believed that they would be ‘sold out’ by the government in its trade negotiations with the EU in order to protect access for financial services. In fact, although both groups do indeed feel they were sold out by Brexit, the Trade and Cooperation Agreement (TCA) had little coverage of financial services. Instead, there have been several one-sided equivalence agreements, where the UK has granted EU firms access to UK markets, and one major EU-granted equivalence agreement for UK-based derivatives clearing houses. A Memorandum of Understanding regarding financial services regulatory cooperation was signed last year, reflecting the thaw in UK-EU relations following agreement of the Windsor Framework, but there is little chance of it yielding any substantive changes, at least until after the next election.

In any case, Britain’s post-Brexit financial services policy is hardly any more clearly defined than its agricultural policy and, in both cases, the political instability and incompetence unleashed by Brexit have taken their toll. A particular casualty has been the decline of the London stock market. As always, there are many factors in play, but even the Telegraph has identified (£) Brexit as the “prime suspect in the death of the stock market” and the referendum as a decisive moment in the City’s “brutal losing streak”. That losing streak saw a record fall last year in the number of companies listed on the London market, and it has been reported this week that Shell may move its listing to New York. If it does so, it will be following several others, although it would be the most high-profile and damaging case.

In his latest Substack newsletter, the respected economics commentator Simon Nixon pulls no punches in describing what is happening to the London stock market as “one of the biggest issues facing Britain today”, and a “national disaster that is unfolding”, having ripple effects into numerous professions and, hence, into the businesses that service them. And whilst many may care little for the fate of City fat cats, the impact on tax revenues and public services affects all of us. Nixon is equally clear about why it is happening. Rather as with the failures Rutter identifies around CAP, Nixon says that “this is above all a verdict on the political chaos and uncertainty that has arisen in Britain since Brexit.”

It is an important diagnosis because it points to the complexity of what is going on (and which is also important for other sectors). One aspect is purely economic. Brexiters, Nixon says “failed to recognise the extent to which [the stock market’s] pre-eminence had ceased to hinge on British exceptionalism but on the anchoring of the British economy in a deep single market of 450 million people.” The other is the elusive but undeniable factor of ‘investor sentiment’ and, although Nixon doesn’t say this, or not in these terms, that cannot really be separated from international perceptions of post-Brexit Britain in a more general sense than that of particular policies; or, rather, that Brexit is the ‘meta-policy’ which defines those perceptions.

Brexit: structural change with no strategy

One acute, albeit almost unbearably depressing, account of that was provided recently by Sam Knight in a long essay in The New Yorker. One of its key sentences notes that “overnight, and against the will of its leaders, the country abandoned its economic model—as the Anglo-Saxon gateway to the world’s largest trading bloc—and replaced it with nothing at all.” It’s a damning but entirely accurate verdict, which doesn’t just apply to the economy, and even arch-Brexiters like Sherelle Jacobs are beginning to recognize it (£). True, she ascribes this to Britain being too cowardly to use its Brexit freedoms, rather than accepting these are illusory, but her conclusion, that we might as well re-join the EU as be effectively within its orbit but outside the security it provides, is an interesting straw in the wind as to how Brexiters may come to regard their project.

However, even if so, it is far too little and is already too late. Ever since the first post on this blog, I’ve been wary about trying to discern the deep impact of Brexit from individual events or, at least, to try to be careful to separate the two. In that post, I suggested that the referendum “vote was akin to dropping an economic depth charge: a huge splash, followed by an eery silence … that does not however mean that beneath the surface important things are and are not happening.” Admittedly, an ‘eery silence’ was perhaps not quite the right description, but the fundamental point was correct, and I made it again when the transition period ended, and I wrote about the need to “get ready for ‘Long Brexit’”. There, I used a better metaphor in saying that “what is underway is a fundamental shift in the ‘tectonic plates’ of the UK trading economy and its supply chains.”

It's still too early to identify all of what that shift is going to mean, but we can see how, beneath all the noise, there have already been structural changes in the British economy or sectors within it. To take examples from today’s post, that is evident in the differential impact of trade frictions on small and large businesses, the changes happening in agriculture, and the decline of the stock market. It may be that some of these don’t feed through into big changes in aggregate measures such as GDP growth – if, say, small importers of artisanal foods go to the wall that will barely register in such measures, but it will impinge horribly on those people’s lives, whilst making the lives of their erstwhile customers a little worse as well. Other structural changes are leaving a bigger mark on the aggregate data, as the many estimates of foregone growth attest.

Crucially, there is nothing positive to set against them. There are no, or almost no, ‘winners’ from Brexit, and certainly no benefits which, when set against costs, would show an aggregate positive. Nor is there any underlying strategy behind the structural changes that are occurring. Knight is right that there was no new economic model in 2016, and there is no such model now. The vague notion of ‘Global Britain’ never made any sense in a regionalized world, the deregulatory ‘Singapore-on-Thames’ agenda (leaving aside all its other problems) never had sufficient political support to be viable, and the idea of the UK as a kind of regulatory superpower in emergent technologies like AI was a fantasy. Even less persuasive is the idea that all three could be pursued simultaneously. What is left is a muddled confusion, which no one can articulate, let alone defend.

So, Labour?

No one expects the present government to develop such a strategy, as it slowly rots away into oblivion. Instead, all eyes rest upon what a Labour government might do, with that attention given new focus by Rachel Reeves’ recent Mais Lecture. About the most positive of the assessments of it came from Will Hutton in the Observer, who, despite finding Labour’s recent repeated retreats “disheartening”, saw the lecture as “an important moment” leaving him “upbeat and encouraged” that Starmer and Reeves might trigger an investment revolution, lower inequality and revive the green agenda when in government. However, rather more common were reactions such as those of the Financial Times’ Martin Wolf, whose reading of the lecture was that Labour’s “plans should not make things worse”, but questioned whether they can make things better.

The issue here isn’t just Brexit, in the narrow sense of the UK’s trading relationship with the EU, but it is inseparable from Brexit in terms of whether under Labour the UK can develop a viable post-Brexit national strategy. Doing so certainly entails normalizing the tone and deepening the content of UK-EU relations, and there’s every reason to think that will happen. That in itself, especially if in the context of a huge electoral victory, would help to establish a sense internationally that the country has returned to the kind of normality that has eluded recent Tory governments, and not just in terms of Brexit. Whether that is enough without a more profound change in the trading relationship than Labour has committed to is the big question.

Infuriating as it may be, this question is not going to be answered this side of the election, and the reason is very obvious simply from reading the front-page banner headline of a recent edition of the Express. Originally titled “Tory MPs warn voting for Reform UK will kill Brexit”, the article is a desperate plea to would-be Reform voters to back the Tories, including a warning from the Party's new Deputy Chairman Jonathan Gullis not to be “seduced” by Reform as that “will let Labour in through the back door”.

This is not a new message, and it is one which will be deployed ever-more vociferously as the election approaches, but at the moment it has little cut-through. For one thing, it can hardly be lost on its target audience that Gullis’s predecessor, Lee Anderson, used to say the same things - and then proceeded to join Reform. Indeed, to the extent that Gullis appears to see his “mate” Anderson as a role model – an astonishing possibility given Anderson’s thuggish mediocrity, and made plausible only by Gullis’s own – it would not be altogether surprising if he followed suit.

And this points to a more fundamental problem. For years now, MPs on the Tory Right like Gullis have been pushing views that are indistinguishable from those of Reform, whilst denouncing their own party for not being ‘real’ Conservatives. So asking voters now to back the Tories is hardly convincing, and even less so now, given the extraordinary intra-party cooperation between Anderson and some of his other Tory MP ‘mates’. Likewise, so often have such Tories denounced the Brexit delivered by their own government to be ‘Brexit in Name Only’ that it is hardly going to make much difference to leave voters if Starmer plans to continue in the same vein. Even the suggestion that Labour will “kill Brexit” may not mean much to voters who have already been told ad nauseam that it died long ago at the hands of the remainer Establishment.

In fact, one of the many reasons why the Brexiters have so comprehensively lost the battle for the post-Brexit narrative is their attempt to defend Brexit whilst simultaneously insisting that it hasn’t been done properly. Although what they mean by it is something different, that insistence has gifted Labour the line ‘make Brexit work’ (irritating and silly as it is) and, with that, a degree of cover for what could otherwise be depicted as undoing the success of ‘proper’ Brexit. However, that would change in an instant if Labour were to make a proposal for any kind of re-joining, including a customs union, rumours of which have been discussed and denied this week. Suddenly, the Tories would be given the best possible chance of capturing the Reform vote and of avoiding a heavy electoral defeat, if not even avoiding defeat entirely.

The flip-side is that Labour will have little or no mandate for seeking substantive changes in the EU trading relationship after the election. That might be less of a problem than some think if such changes were wrapped up in technical jargon, and agreed with the EU quickly, whilst the opposition was in disarray. It’s not exactly an appealing idea to anyone fastidious about democracy, but nor does it require an inordinate amount of cynicism to imagine. At all events, we are not going to know until the time comes, and if that is a fresh sign of the dishonesty that Brexit has brought to British politics, then it must be chalked up as yet another item on the seemingly endless list of Brexit damages.

And so we drift on – no, I haven’t forgotten where I started this post – in the apparently Timeless Test that is Brexit.


  1. It's not Brexit.
    Badgers dug up the wicket.

  2. Thanks Chris. A brilliant (and well written) analysis as always. The madness of Brexit continues.

  3. Insightful and incisive analysis even if it is quite depressing! I am keen to know why are the import controls being implemented now? They are an admission of the brexit damage (which brexiteers have always denied). By making food dearer for people already struggling with the cost of living, it would increase the electoral losses for the Tories. So why bring them now? Is it due to a legal deadline that cannot be avoided or is it salting the earth - hand the next , most likely a labour, government a situation impossible to manage in the next government cycle paving the way for a next Tory government (with Nigel Farage as the Prime Minister)?

    1. The latest deadline was announced a while ago, so I suppose another postponement, which would be the 6th, would be too ludicrous. One consideration now could be - better to get it over, in case of supply disruption, before the GE. There could also be a fear of some huge food contamination scandal the longer it is left undone. There's no real legal deadline - some think that eventually a non-EU country might take a discrimination case to the WTO, but that would take years. I don't think the salting the earth idea holds water in this case as, with that motivation, leaving it until after the GE would be better.

    2. Actually this one I think (hope) is a slow realization of electoral reality, because Farmers are actually a fairly important part of the Tory electorate.

      One could question this given how committed the tory party is to "free trading fantasies" and ending all Ag subsidies, but here the EU, as always, the reason.

      Because while the Tory party (and Labour) has been committed to ending the CAP since 1973, but since the UK in practice had no chance whatsoever in achieving this, there was no electoral cost for the Tory party to indulge in it's 'free trading fantasies' along with no subsidies to Farmers.
      Well there was one, the slow radicalization of the Tory party to bring about Brexit precisely because the EU, and the CAP and CCP was constraining the aforementioned fantasies.

      So thus finally the penny seems to drop, that while having no checks (because Free trade) and no subsidies (because Free trade) while lose them a lot of key voters in key seats they are finally perceiving reality:
      Because while the checks will mildly increase prices (it's unlikely to be noticeable, what with all the other inflation, and Labor is unlikely to point it out, what with Brexit being a verboten subject) it will help farmers facing unfair competition, and reduce the biosecurity risks with the present model.
      At least one can hope that's the reason.

  4. Chris - I would also like your views on how lack of a Constitution created structural weaknesses that were eventually exploited by many, including Brexiteers, to their advantage. It is a surprising that a developed country with the fifth largest economy which has the mother of all parliaments has no constitution - no rule book how to run the Country. It has relied on nods, winks, conventions, gentleman's words, and the like, to carry out business. It has allowed for people like Cameron and Johnson to advance their politics at the cost of the common people. There is a lot of discussion about PR etc but unless the basic issue is resolved, how can any progress be made? I have not read commentary on this issue (unless you have posted in your previous blogs and I have missed it - sorry!)

    1. Beyond my expertise, I'm afraid - but there is some relevant discussion in Russell & James' book The Parliamentary Battle over Brexit (the authors are from the UCL Constitution Unit)

    2. I don't think the UKs lack of a codified constitution is the real problem. It would be nice to have a single document describing the workings of government, but it's meaningless unless the people actually follow the rules. There are plenty of examples of governments sending their country down the drain despite having a decent constitution.

      I would say the main problem is a highly centralised government, and shallow gene pool for ministers. The latter is largely due to FPTP setting up a system where people are ostensibly voting for a person, but in fact most people don't care about their local MP specifically and are voting on the basis of party.

      None of this requires a codified constitution. Constitutions are just paper. You need people to actually want to make it work.

    3. The main advantage of a constitution is when there is a strong amendment process and effective checks and balances. The courts would have been required to stop johnsons illegal prorogration and the next parliment wouldn't simply be able to overturn rights like parliment can. But even a string constitution system can fail see how the us allowed anti terrorism law to deprive liberty. It was our unelected unaccountable laws that watered ours down to preserve some freedom.

  5. Nothing meaningful will happen until after the general election. What is possible afterwards will depend critically on how few Conservative MPs are left in the House of Commons.

    The Labour Party is right to be very cautious in what it says about relations with the EU, because its single-minded goal needs to be maximising Labour MPs.

    Once the general election is over, to continue the cricketing analogies, both Labour and the Lib Dems can start rolling the pitch by talking about how Britain's position cannot really be fixed without fundamental change in its relationship with the EU, where nothing should be ruled out.

    1. I agree - though it does carry some dangers as per my penultimate paragraph

  6. Eric Owen Smith12 April 2024 at 11:48

    Your point about the dreary, be-blazered bores at Lords is well taken. Can we now expect an analogy between Brexit and the playing fiels of Eton?

  7. Labour will have little or no mandate for changing the Brexit course? If over half of the UK now regrets it, what do you mean? Half the country must continue with 0 political representation,?

  8. I mean, if (as seems to be likely) they have put in their manifesto that SM, CU and FOM are ruled out they will have little or no mandate to seek substantive changes to the relationship. Which, apart from being a domestic constraint, might well deter the EU from agreeing to such changes even if a Lab govt sought them.

    1. If the Tories, in their election Campaign, really do stress the line "letting Labour in (via a voter for Reform-UK) will be the death of Brexit" - it would be an idea for Labour to simply let the Tories brand them as pro-EU. Labour would not need to say anything about FoM, CU and SM in their manifesto. If Labour wins a big majority they will know that the pro-EU stance of which they were accused, is popular enough that they could make significant moves to improve our relationship with the EU.

      BTW "Border Target Operating Model " allows itself to be abbreviated as "BoTOM"

  9. The drift is important and doing great damage. Lack of direction and planning is leaving companies in real difficulty. A case in point would be Alstom who run the old British Rail (and former Bombardier) workshops in Derby who have just mothballed the plant. It has been reported bt the FT who do have a decent finger on the pulse. Many years ago I worked on carriage refurbishment with Bombardier in Derby. Alstom had modernised again and wish to manufacture a genuine world class carriage chassis and custom solution to customers worldwide. After 10 months discussion with this government and HS2 cancelled with no mandate - not in 2019 manifesto the government could not care less.
    All that does is send signals to Siemens, Hitachi and Adtranz, hey guys get ready to pull out or shut down. Remember Honda turned around their electric car tooling when halfway to the UK, a 'benefit' of Brexit. Rees-Mogg did invoke some stuff about the 'yellow peril' in the H of C at the time...
    It is exactly this indecision which will cost a great deal in certain areas of manufacturing, pharmacuticals and other sectors. Starmer will not be able to change this because those decisions are being made now.

    I attended a group local meeting with my MP and prospective new MP as in a new constituency next election (Farnham and Bordon) last night. The local sitting MP was remarkably comfortable with their being almost no damage to the City of London, HS2 money sorting the local potholes (they are bad), the report the UK still 4th biggest exporter while forgetting to allow for inflation and many other partial truths. Whilst I did make it clear that HS2 cancellation had no mandate and that jobs were on the line vis a vis the train/carriage manufacturers there was little understanding of that predicament. Maybe that Westminster bubble really is isolating. The new constituency is a three way marginal with MRP polling showing C or LD winning, it may depend on more local damage to change minds.
    One interesting thing was a guy in the meeting who raised the prospect of Reform (as a party) as he was not happy with the abandonment of the 2019 manifesto policy outlines and the lack of delivery....

  10. One of the most shocking aspects of Brexit for me has been the Government's utterly irresponsible disregard for public health (and the UK farming industry), by failing to impose checks on food imports. It is such a relief to see it called what it is: a scandal. The Government's strategy has been obvious: downplay the risks and pray that no horsemeat-style incidents (or worse) come to light while they are still in power. I have been amazed by the complete indifference of the UK press to this issue. Thank you for highlighting it.

  11. Anyone who thinks Britain's problems can be resolved through a closer trading relationship with the EU is delusional. True, some technical adjustments may improve matters at the margins, but the deeper problem is far more fundamental: Britain is an unstable class ridden plutocracy that is only sustainable through delusions of British exceptionalism and popular prejudice against foreigners as the root of all evil.

    Without a political revolution which ends the obsession with class snobbery and the rule by Eton/Oxbridge idiots, Britain cannot be a positively contributing member of the international community, never mind the EU. The EU would be well advised to sup with a very long spoon in all its dealings with Britain, as Ireland's recent experiences can testify.

    The Command Paper "Safeguarding the Union" actually calls the Good Friday Agreement's provisions for promoting an all-Ireland economy a "misguided and divisive concept" and pledges to end UK government support for better trade and cooperation on the island. And all to shore up the position of Jeffrey Donaldson who ended up having to go anyway.

    Without a political revolution in England, you can kiss better relations with the EU goodbye.

    1. " Britain is an unstable class ridden plutocracy that is only sustainable through delusions of British exceptionalism and popular prejudice against foreigners as the root of all evil.
      Without a political revolution which ends the obsession with class snobbery and the rule by Eton/Oxbridge idiots..."
      I thought (and I have read some of the testimony of Mr. Cummings and Mr. Gove) that a revolution of this sort was exactly what Brexit was supposed to bring, or at the very least make possible.

  12. A knock on impact of Brexit is the fact that a huge national company such as ARM was first of all sold off, and second of all listed on the Stock Exchange in the US and not the UK. It should be front page news and a massive scandal. ARM design every single CPU chip in every single Apple iPhone. Yet we let the Japanese buy it first of all and then because of Brexit they don't even list it here. This for me is a microcosm of the wider problem. Our Government are not protecting their own citizens and not serving their own people. If it was the US they would never in a million years have allowed such a vital company to national interest be first of all sold off, and second of all listed elsewhere. I apologise for the crude language but the UK is touting itself out, flogging itself to whoever will buy such as in the CPA and Trade Deal situation, but getting nothing in return through plain and simple poor management.

  13. Very interesting analysis at the end. In a sense, then, the Brexit narrative was always doomed, because it was faced with a catch-22: either promote and implement a specific model and find that the public is disappointed because of the downsides it brings and which were previously denied would happen, or say that whatever model is implemented was Brexit In Name Only and find that even the brexity part of the public doesn't care about defending what they were told was merely BINO. Hm.

    I understand Labour's conundrum. Still, as mentioned before under other posts, what worries me is the thought of a Labour government getting in, not daring to improve anything, and then immediately losing to a rejuvenated radical right-wing in 2029. And that isn't a UK-specific problem. In many Western countries the choice is between an increasingly radicalised right and a nominally centre-left but really centre-right party that sells itself on doing the same as the right but less embarrassingly and less corruptly. Logically, that means that no problems ever really get solved except by accident.

  14. I should have moved to Ireland when it was clear both these Conservatives and Labour would force us out of the single market and customs. We left it too late though due to arguing over Ireland vs Scotland and by the time the customs border went up the cat passports didn't work and we couldn't get the cats across.

    So, we are in Scotland but the company still can't funtion so I'll move to Ireland.

    I can just about understand these Conservatives messing everything up due to ignorance and hubrus but for Labour to carry on trashing companies is unforgivable and a total dereliction of duty.

    This clown show has cost me my home, company and hundreds of thousands of pounds and I've had enough of it.

    Hopefully I'll get a Labour politican knocking on my door and I'll be able to tear a strip out of them.

    1. We have gone to Scotland as well. I look forward to my local Labour candidate knocking on the door as well so that I can give them a piece of my mind. They are cowards, pandering to the economically inactive who voted for Brexit whilst ignoring those of us who actually work and somehow have to make the best of this mess. And that's without mentioning Labour's betrayal of those too young to vote in 2016

    2. In the 2019GE Labour under Corbyn offered the country to renegotiate the deal with the EU and put the new-deal to referendum with the option to vote for staying in. PM. Johnson ( a well documented rogue, even at the time) realigned the Tory party and campaigned in the GE2019 with the single purpose of "Get Brexit Done" The voters returned a massive majority for the Tories which combined with the 2016 referendum result makes Brexit arguably the most democratic political event since Attlee 1945 . The nature of the Conservative government (a mixture of asset-stripping arrogance, cupidity and incompetence) since then is IMO a natural consequence of Brexit and was easily foreseeable for anyone with not blinded by an excess of nationalistic hormones. .

      IIRC, in the run up to the GE2019, Mr. Starmer was warned in no uncertain terms by many of the Labour officials from "Red-Wall" seats not to go soft on immigration.

      To me it is hardly surprising that Starmer is extremely wary of looking either too left-wing or too pro-EU.

      If I were a Labour candidate knocking on doors, I would want to know if the voter had voted for Labour in 2019 before I would listen to the piece of his mind. If they hadn't I would be very tempted to give them a piece of mine. (shades of Gordon Brown and the "bigoted" old lady).

    3. "Mr. Starmer was warned in no uncertain terms by many of the Labour officials from "Red-Wall" seats not to go soft on immigration."

      Labour party before country, people, the Good Friday Agreement and the economy.
      People and companies should think about taking legal action against political parties.
      Labour have destroyed people for their own political convenience and certainly destroyed the economy.
      What a dreadful place the UK is now.
      I voted for Labour in 2019.

    4. 'The most democratic political event since 1945'. Do you mean the achingly narrow majority that voted for Brexit in 2016 on the side of a bus, ignoring the vote of settled EU citizens, law abiding taxpayers who were ignored and vilified all along?

    5. I posted the "Anonymous14 April 2024 at 12:10" post.

      @Anonymous14 April 2024 at 19:46: What I pointed out is that Labour was listening to "The People" or at least its voters, actual and potential. It tried to bridge the gap between the leavers and remainers by offering a second referendum on a renegotiated deal and with the option to stay in the EU. This offer was rejected wholesale by the electorate in the 2019 GE in favour of the "Get Brexit Done" Tories. This is not the Labour Party "destroying people, ..." ; it is People destroying other people by electing the destroyers.

      Labour have not been in power since 2010, the Tories have through 3 GE's. If you want to go after anyone then go after their voters. The UK is a Democracy after all.

      @Anonymous15 April 2024 at 06:26: I meant what I wrote: the Referendum 2016 and the "Get Brexit Done" GE2019 resulting in a dictatorial sized majority for Johnson and his hand-picked-for-Brexit-Tories.

      In my view the country had a real choice in 2019 and it blew it - period.

  15. Dear Prof. Grey, I feel very much indebted to your regular profound insights on Brexit, which as usual go well beyond the depths of all other qualified commentators I read, so: thank you. While cricket analogies leave me confounded and on occasion make me feel like a despairing citizen of the barbaric lands of cricket ignorami, I do hope I sufficiently grasp their gist.
    I was wondering, however, about your views about the particular interaction between short-, mid- and long-term effects of Brexit -- the ones you describe as happening deep underneath the ocean surface. The French structuralist school of historical thought argued that history is more often determined by long running underlying trends (currents) than by surface events - and they also used the ocean as their metaphor. In short, if Labour is practically (for tactical political reasons) incapable of bringing about a rational public discourse on EU membership within the next few years, is it then not logical to assume that the likely impending Labour government is already doomed to fail as their reforms can simply not be enough under these circumstances, as the British public is simply not able to come around to a more pragmatic debate (a mid-term effect)? What does that leave us with for four to six years down the road, in your opinion? A return of the Tories after that, promising a "real Brexit"? Would you hedge your bets that this depends on too many factors to say at this point, or would you dare to guess a probability that Brexit will still be a fundamental issue (for the UK) six years down the road? Is there then, in other words, really no end in sight for the coming decade? Or would you guess there is a realistic chance that London and Brussels find an "acceptable" chimera treaty that somehow allows for a CU membership that satisfies both the UKs economic needs and pacifies those who feel that any closer arrangement would be an unpatriotic betrayal of Brexit? Reading your commentary usually leaves me with the impression that the self-contradiction of the latter -- Brexit betrayed if anything too close to EU is signed, but Brexit also imperfect if its negative economic consequences remain apparent -- has become a sort of Gordian knot that forces the UK into a political standstill, forever doomed to squabble over a conundrum that appears to be simply a false dichotomy. In short, do you see a potential near-term way out, or am I misrepresenting the situation? Thank you for any answer, if you should find the time.

    1. Important question, or rather questions, there, and great framing of them! But, yes, I am going to hedge my bets because it is all really unknowable – you could make a good case for several scenarios. I suppose two of the key issues are: a) whether the next generation of political leaders, who are young people now, retain commitment to EU membership, or whether they will see it as yesterday’s battle; b) whether a genuine commitment to EU membership emerge, by which I mean not just the idea that Brexit is damaging and ‘we have to rejoin’ in a dog in a manger kind of way but a positive commitment. And of course neither of these issues is separate from how the EU itself develops, as well as UK politics. Beyond that, there are so many bigger issues about climate, about war and geo-politics etc within which Brexit or Brentry are sideshows.
      In retrospect, the underlying structural currents that shape what happens will look obvious, almost banal. But history isn’t history for those living through it, so those currents are largely invisible.

      PS Sorry for the cricket analogies!

  16. What we do know is that Labour have committed to an improved relationship with the EU. That means a shift in position and just like in chess that opens up myriad different possibilities. Hopefully the polls are right in that the Tories are finished. That's the first move in this game. As long as Brexit is eventually checkmated.

  17. I was recently involved in getting the CE mark for a product to be sold in the UK. It did make me think about the lack of democratic control that we know have over goods sold in the UK and the difficulty businesses have in getting regulation changed as the UK is no longer at the table when our rules are made.

    As the UK continues the process of getting closer to the EU under Labour, I suspect this lack of control is going to be more and more of an issue.

    1. I should have slightly clarified this. There are two certification routes for selling a product in the UK:
      1. UKCA mark
      2. CE mark

      The process, rules and cost are very similar. The difference is that the UKCA mark only allows the product to be sold in the UK but the CE mark allows the product to be sold in any EU country plus the UK plus other countries depending on what it is (in our industry New Zealand accepts CE marks for example.).

      So in practice nobody is using the UKCA mark and I question how long it is likely to be around.

  18. Chris - interesting blog as ever.

    One more depressing factoid for remainer's is that, like it or not we are diverging away from the EU laws /regulations - this is both passive and active - evidence base is UK in a Changing Britain:
    It's not to say we can't go back but the enormity of the task will take years if not decades.

    The other paradox is in trade - that despite Brexit , according to the UN , the UK is now the 4th largest exporter of services - having moved from 7th in 2022 to 4th place in 2023.

    Who'd have thought that?

    "According to the latest statistics from the UN Conference on Trade and Development (UNCTAD), which leads on global trade for the UN, the UK has overtaken France, Netherlands and Japan to take fourth position, behind only China, the US, and Germany."

    So yes, we've been hit by some economic woes for admittedly smaller players - the macro picture indicates that services ( and we are a 70%+ services based economy) is pretty robust and growing.

    The difficulty facing labour to sell a positive EU regulatory story is problematic too - coming out of CPTPP isn't going to be easy (pesky international treaty just signed) and having to sell a barrage of intrusive EU regulations /directives to a tired electorate could easily backfire if/when it comes out in the election campaign.

    As you've indicated - anything and everything to do with the EU is complex - no quick wins here.

    1. I would disagree on the divergence issue, unfortunately the UK in a Changing Europe website is down right now so I can't read the report.

      I'm pretty sure it takes de jure regulation divergence which I would agree is happening. But de facto divergence isn't.

      As an example, for my products the UK has not passed any of the recent regulation so we have de jure diverged.

      However Britain requires a CE mark for the product to be sold in the UK, and to get the CE mark we need to follow all EU regulations including the newest ones so we as an industry have not de facto diverged.

      Another interesting case of convergence was the last budget where the Chancellor wanted to increase the VAT registration threshold above the EU limit but couldn't because that would have meant a different VAT threshold in Northern Ireland to the rest of the UK.

      Again the de jure position is that the UK can diverge on VAT but the de facto position is that it can't without creating a barrier in the Irish Sea.

      So the centripetal forces are much stronger than you may think!

    2. Reports, reports, adjusted for inflation, benchmarked.... etc.
      My service industry (audio-visual) died a death.
      The financial industry and the good old LSE in trouble....
      They were the largest services industries in the UK.

      Where is this gain that makes the UK 4th in services ....... export or home? The UK has always been a very home based economy.
      Is it dish washing and general cleaning services that have dragged us to these new Brexit heights, or customs and excise services, or maybe armed forces training services....?
      I hear we are good at all of those.

    3. Of course, I should have known.... dish washing wasn't going to move any wickets.....
      We do a good line..... for some....

    4. The regulatory divergence that is occurring is, as you suggest, more passive than active – and of course that means that, absent of decisions to dynamically align (which Labour may take, though Starmer has said not) that means the gap between UK and EU regulation will increase. However, as another response has pointed out, that gap may not be as large as it seems to the extent that that, whatever HMG may do, firms themselves may continue to track EU regs. Either way, I don’t think is has much bearing either way on the likelihood of re-joining – the issues there are political, and if the decision was made to re-join then the UK would and could (re-)align, as all accession countries have done.

      The issue of services trade is interesting, although I wouldn’t read much into one data point, especially in an area where data is notoriously tricky, but the key point about it is that there is no reason to think that Brexit has *helped* services trade, since there is no mechanism by which that could that have happened, given that there are now more barriers to services trade with the EU, and virtually no reduction in barriers to services trade with ROW.

    5. Good post about 'de jure' and 'de facto'.

    6. There have been reductions in barriers to services exports, for example there’s been a Mutual Recognition Agreement signed with the US for architects. Relative to the previous MRA with the EU the US market is bigger in economic size, builds larger buildings, has more consistent regional tastes, has minimal language barriers, and many Americans seem to think that a British accent adds at least 10 points of IQ lol

    7. Very interesting about the UK-US MRA on architects' qualifications - thank you, as I was not aware of that (though note that I said 'virtually no', not 'none at all'). Even so, it has to be set against loss of MR with EU, and is it the case that such an MRA couldn't have been made as an EU MS? (I don't know the answer).

    8. It *may* be possible for the EU to conclude an architecture MRA with the US (it has one with Canada). However it seems extremely unlikely as an attempt to agree one foundered in 2005 and has not been revived. Even the MRA between EU member states is highly controversial, as the scope of training knowledge and experience required in order to legally call yourself an architect varies significantly between member states.

      The UK has also signed MRAs with Aus&NZ, and is currently negotiating ones for HK and… the EU. It is therefore possible that before long the UK will have essentially restored its pre-Brexit arrangements with the EU on architecture, and added ones for major English-language markets across the world. But as noted the diversity of the EU would make that tricky, and this time there’s no ECJ to force the matter.

    9. Interesting, but my question wasn't about an EU-US MRA on this, but whether an individual EU MS could create such an MRA with the US (I don't know the answer).

    10. The UK’s new architecture MRAs are specifically enabled by the Professional Qualifications Act 2022, about which the govt said:

      “ The freedom of UK regulators of professions, such as the Architects Registration Board and the General Medical Council, to decide who is fit to practise is now enshrined in UK law for the first time.”

      So apparently it would not be possible for regulators from an individual EU MS to agree such an MRA.

    11. Thanks for that. As you say, 'apparently', and that is an accurate assessment as that government statement is extremely carefully worded so as to avoid saying it wasn't *possible* before. Having seen a lot of these kind of statements in other post-Brexit policy areas I'm suspicious of this one.

  19. The CE marking fiasco is such a perfect example of the false meaning of 'taking back control'. The unworkable wine taxation by one tenth percent of alcohol related to amount of duty is another yet to come.
    At the same time my local (Conservative) MP has called for growth and exports, presumably to help business as much for EU based test houses... which can test stuff for the UK market! Along with the transfer of all the existing CE certificates from UK to EU test houses!.

    If you read some ot the CPTPP documentation you will find that the UK can negotiate with other members to allow UK test houses to approve products from other members for their market. This would mean a UK test house could test for say Australian standards for products for that market. Has any of this actually happened no. I'm pretty sure I got this right but someone may have another interpretation.

    Divergence with the EU has and will continue, the UK has yet to outline how they intend to make other countries accept the UKCA marking. I know of a problem with a medical product UK made which cannot be sold in NI because it needs a UKNI approval and there is no test house with the capability of testing it in NI....

    There's a lot of stuff with IP too, Design registration, a bit less on copyright but still some implications on Patents and the UPC but stuff will diverge. It might not matter to some but it does overall to the greater economy and the wealth of the country. We shall see how politicians deal with it. Note Shell and Glencore may list in the US following ARM as pointed out above. In the end it will have an effect.

  20. the 'Timeless Test' was abandoned on the 10th day

  21. No strategy? In terms of our global economic position we’ve joined CPTPP. In terms of our foreign policy position we’ve joined AUKUS which will not only provide British nuclear subs to Australia but allow us top secret access to American, Australia, perhaps Japanese and Canadian knowledge on what are poised to be foundational technologies of the future, such as AI and quantum.

    The Indo-Pacific tilt may or may not be a good strategy; but to say that it is none seems misplaced.

    1. The I/P tilt strategy was effectively abandoned with the refresh of the Integrated Review, and anyway rendered largely obsolete by Ukraine. AUKUS could have happened as an EU member (recall that UK replaced France). CPTPP is of marginal value.

    2. UK didn’t replace France. France was offering conventional subs; AUKUS was an entirely different programme involving nuclear subs and cutting-edge knowledge-sharing. Notably, France has not been invited to join.

      Since our army is relatively small and Ukraine is a continent away, I suggest the main strategic result for the UK of an increased Russian threat would likely be Canada joining AUKUS in order to better patrol a melting Arctic Ocean.

    3. They are two sides of the same thing.
      "The agreement meant the concomitant cancellation of Australia’s contract with the French Naval Group to build 12 conventionally-powered submarines."

    4. The Royal navy cannot even supply it's own RFA support to active service vessels in the mouth of the Red Sea at the moment. How it is supposed to protect global trade routes to Australia, Japan and NZ etc goodness knows how. Even the US Navy has a problem. If the the Indo Pacific stategy was implemented expect Defence spending to rival that of the US say 800 Bn USD equivalent and replace Galileo for good measure. It is a valid stategy but not one this government have planned for.

      Also one good irony is that around 15% of the steel in our current nuclear and presumably future AUKUS submarines comes from France as we do not make that particular grade/alloy.


    Sometimes when Empires collapse it is quite unexpectedly. Our EU friends want us back and have just been biding their time to start the process. A Labour victory would mean nothing is off the table given a little time.