Friday 27 September 2024

Accommodating Brexit

Are there any expressions other than ‘the elephant in the room’ to connote the ignoring of big, obvious things? If so, it would be useful to know them as that poor old elephant is now the most clichéd of clichés to describe the government’s attitude to Brexit. In their speeches to this week’s Labour Party conference, Rachel Reeves mentioned it only briefly and in passing, and Keir Starmer not at all. It’s absurd, especially as the guiding theme of both speeches, as of the government’s entire incoming communications message, is that of the dire inheritance bequeathed by its Tory predecessors. Brexit can hardly be excluded from that reckoning.

It's tedious to go on and on making that observation, and it’s certainly not made with any surprise on my part that Nellie is still ignored in the corner, but it remains a necessary one, for two reasons. One is because, mentioned or not, Brexit continues week-in and week-out to exert its damaging effects. Ignoring them doesn’t make them go away. The other is that, in the continued absence of discernible post-Brexit strategy, this means that the government’s approach is one of ‘accommodating’ Brexit. That is perhaps slightly different to ignoring Brexit, as it is a kind of acknowledgement of Jumbo’s existence alongside a dogged determination to live with it.  

The ongoing damage of Brexit

As for the first of these, the latest news on the economic damage of Brexit comes with a new study by Professor Jun Du and others of Aston University. Apart from providing new evidence of the already well-attested “profound and ongoing” dampening effect of post-Brexit trade barriers on UK-EU goods trade, it identifies two, more specific, things. One is the particular effect of reducing the varieties of goods traded, sharply and continuously in the case of UK exports to the EU; declining, sharply recovering, then slowly declining again in the case of UK imports from the EU.

My reading, although it isn’t stated quite in these terms in the report, is that what has happened is that small product lines (and especially those of smaller firms) have simply been dropped as not being worth the extra costs. That has happened continuously as regard UK exports because the EU introduced full import controls immediately. In the other direction, it was discontinuous presumably because the initial impact of customs and VAT charges had an immediate effect, which was then adjusted to, but more recently the gradual introduction of UK import controls has produced a new decline.

Whatever the process, the result is that specialist products are now less likely to be traded. That has an economic impact on the firms affected, of course, but it also reduces consumer choice, with effects which are not just economic but adversely affect quality of life. Delicatessens are a good example, as trade in small batches of artisanal food products is exactly the kind of thing which has suffered. It’s easy for Brexiters to sneer that, like post-Brexit travel barriers to fancy foreign holidays, such things are the complaint of the effete metropolitan elite. But, whatever purveyors of this new politics of envy may imply, it is hardly the case that everyone other than middle-class Londoners holidays, if at all, in Bridlington, and subsists solely on bread and dripping apart from an orange at Christmas. (An orange, you say? You had it lucky!)

The other noteworthy finding of the Aston study is that Brexit has “heavily disrupted and weakened” UK-EU supply chains. This isn’t surprising, and confirms earlier research by, for example, the Resolution Foundation, but, apart from providing valuable new empirical evidence, it is worth highlighting because it strikes at the heart of one of the Brexiters’ many stupidities. Because they thought of the single market as being a kind of trade agreement, potentially replicable by a new trade agreement, they entirely failed to understand its role in integrating supply chains. Obtaining, as the UK did, a (largely) ‘tariff-free’ trade agreement with the EU did little to address this, and now we are living with the consequences.

It’s worth stressing again that, as with the consequences for trade, these are ongoing. As I pointed out when the transition period ended: “what is underway is a fundamental shift in the ‘tectonic plates’ of the UK trading economy and its supply chains, happening in real time and under our noses, but with little comment on the aggregate picture. And it is going to get worse when all the new rules are stringently applied on the EU side and applied at all on the UK side. It is reaching, or will reach, into every niche of economic life …”

What has changed now, of course, is that it is becoming possible to see the aggregate picture, with the Aston study being the latest instalment.

Mutual recognition - again

Press reports of the government’s reaction (£) to the Aston study just repeated the standard mantras about “improving” trade terms with the EU by “tearing down unnecessary barriers”, which doesn’t begin to address the problems. The study’s policy proposals for doing so include regulatory alignment, which seems likely to be consistent with government policy, but rightly recognize that to significantly reduce trade frictions such alignment would need to be accompanied by ‘mutual recognition’ of regulations as between the UK and the EU.

To a degree, that too is consistent with government policy, at least as regards its stated intention to seek mutual recognition of professional qualifications. However, there are significant obstacles even to that, and far more to the extensive use of Mutual Recognition Agreements (MRAs). The EU does enter into some MRAs with third countries, but it was a persistent folly of some of the more ‘sophisticated’ Brexiters to believe that the single market could be extensively replicated by a patchwork of such MRAs, a folly embraced by Theresa May in her March 2018 Mansion House speech when she called for “a comprehensive system of mutual recognition”. However, there was simply no possibility of the EU agreeing to this, as it would effectively end the single market, for reasons set out elegantly and in detail by Professor Stephen Weatherill of Oxford University at the time of May’s speech. That analysis still holds.

It’s true that the Aston proposals are nothing like as unrealistic as Theresa May’s were, in that they refer to a small number of “key sectors”, but, although MRAs in such sectors can’t entirely be ruled out, there is unlikely to be much appetite within the EU to entertain them. Not only would doing so begin to make the EU’s relationship with the UK look rather like that which it regards as complex and cumbersome with Switzerland, it would do so without the UK accepting, as the Swiss do, freedom of movement of people. We’ve been all round these loops before, both before the UK left the EU and afterwards, most recently in November 2022. As the reference to May’s 2018 speech also illustrates, in many ways the UK is still stuck on what in the past I’ve called the Mobius Strip of trying to square the circle of Brexit, by endlessly revisiting solutions to the impossible conundrum of how to be ‘out’ and yet be ‘in’.

The one area where that circle might be squared is that of what seems to be Labour’s ‘flagship’ post-Brexit policy of seeking a Sanitary and Phytosanitary (SPS) regulation deal with the EU. I’ve written about this numerous times but, even there, if the government intends to seek, as at one time the Tories did, an SPS deal based on ‘regulatory equivalence’ then it will not be agreed by the EU. And this is because such a deal would (in effect, even if not in formal terms) be a form of MRA, with both the UK and the EU mutually recognizing each other’s regulations as ‘equivalent’.

If the EU agrees any SPS deal, it will be based on ‘dynamic alignment’ with ECJ jurisdiction and, in that de-limited sense is often described as a ‘Swiss-style’ agreement. It could also be described as, within the SPS domain, the UK being ‘in’ whilst in all other respects being ‘out’. But this would be an exceptional deal, conceivable because it has in the past been offered by the EU (and rejected by Johnson’s government as violating UK sovereignty), and not a template for other sectoral carve-outs.

Regulatory alignment of product standards

An SPS deal may be one of the main ways that the government will seek to accommodate Brexit, but some of the issues wrapped up in those of regulatory alignment and mutual recognition surface in other policy developments.

A key example is the Product Regulation and Metrology Bill (PRMB). I’ve mentioned this Bill a couple of times since it was unveiled in the King’s Speech, referring to it in terms of providing the legal basis for the UK to continue to follow EU safety regulations and, as such, being an important indication of the government’s commitment to regulatory alignment. What I failed to spot, but was alerted to by Nigel Haigh of the Institute of Environmental Policy UK, is that whereas in the King’s Speech the Bill was indeed entitled the Product Safety and Metrology Bill, in its published form the word ‘safety’ was replaced with ‘regulation’, and that betokens a much wider ambit. Just how much wider remains to be seen, but one important clause in the Bill refers to potentially tracking EU regulations relating to the environmental impact of products.

No matter how wide its ambit turns out to be, this doesn’t amount to ‘dynamic alignment’ with EU product regulations, in that, whilst creating an easy mechanism for the UK to follow such regulations as they change in the future, it does not create any commitment automatically to do so. In this sense, despite Brexiters’ horrified reactions to the Bill, it does not actually violate sovereignty, even in their highly restricted meaning of the term. However, it does at least imply a commitment to ongoing regulatory alignment as the norm rather than the exception.

To the extent that this implication is realized in practice it will have the effect, amongst other things, of somewhat mitigating the costs of Brexit, since it means that businesses only need to produce to a single standard whether selling in the UK or the EU. To a degree, that may not make much difference. We’ve already seen, most famously with ‘tethered plastic bottle tops’, that firms sometimes choose to follow EU product standards even without any corresponding change in UK law, so as to avoid the costs of dual production lines. However, the PRMB should mean that businesses, when selling to the EU, are relieved of much of the burden of having to establish for themselves what EU regulations they need to conform to, since this would be done by the government. It also prevents firms, whether in the UK or overseas, from ‘dumping’ what might be considered sub-standard products on the UK market. It should also serve to ‘thin’ the Irish Sea Border, to the extent that it reduces the possibility of passive divergence between product standards in Great Britain and Northern Ireland.

Nevertheless, it can’t be emphasized often enough that simply having the same regulatory standards as the EU, to the extent that the PRMB will deliver that within some regulatory domains, whilst reducing some of the costs and inconveniences of having left the single market, in no way provides the benefits of single market membership. Alignment is not access (£): the PRMB still means that we are ‘out’ and not ‘in’. To put it another way, there is no ‘mutual recognition’ in any of this, which is the flipside of it being something that the UK can do unilaterally, without the need for any agreement with the EU. The fact that the UK may choose to align with EU regulations does not make those regulations ‘recognized’ by the EU. What it does show is that the UK recognizes (in a different sense of the word) the pragmatic benefits of having regulations which are aligned with those of the EU.

So whilst the PRMB does not in fact violate the Brexiters’ idea of sovereignty – the UK is making its own laws – it does show just how facile that idea is. For what it really demonstrates is that the practical realities of the UK’s economic proximity to the EU mean that regulatory alignment is still its best option, despite Brexit, whilst massively reducing its benefits, because of Brexit. The UK may, in the Brexiters’ terms, have regained sovereignty, and paid the price for doing so, but it can’t afford to use it. The PRMB is simply a (limited) acknowledgment of this reality, and an attempt to accommodate to it by ‘making the best of a bad job’*.

‘Not for EU’ labels

Some of these issues appear in a different way in one of the most abstruse of Brexit topics, that of ‘Not for EU” (NFEU) labelling. As I discussed in a detailed post last October, NFEU labels are, in part, a particular illustration of the difference between alignment and access. They don’t necessarily mean, as many mistakenly believe, that the product they are attached to does not conform to EU standards, but rather that, whether or not they do so, they are not certified for sale in the EU single market.

Without re-hashing that long and complicated post, the labels arise as part of the Windsor Framework as a requirement for certain goods produced in Great Britain (GB) but sold in Northern Ireland (NI), preventing them being legally sold in (the Republic of) Ireland (or, of course, anywhere in the EU, but it is primarily aimed at the possibility of them entering Ireland). The decision to extend their use to GB was an entirely unilateral one taken by the UK government, largely as a sop to NI unionists as it assuaged their concerns about NI being treated differently to the rest of the UK. In a way, this could be regarded as yet another way of acting as if Brexit hadn’t really happened, in the particular sense of trying to act as if the Irish Sea Border Brexit has given rise to didn’t really exist. 

NFEU labels were due to become a legal requirement in GB at the beginning of October for meat and dairy products (fish, fruit and vegetables were set to follow next July), although many firms began to introduce them in advance of the deadline. However, at almost the last minute, the new government announced this month that the requirement has been indefinitely postponed, with a review to be undertaken. To avoid any misunderstanding: this does not mean the end of NFEU labels in NI, where they have been required since last October and will continue to be used, because doing so is part of the Windsor Framework agreed with the EU. Rather, it is the UK’s unilateral decision to extend to their use in GB which has been reversed.

But not for GB

At one level, it’s yet another example of the mess and chaos which Brexit has brought in its train, and especially of the consequences not just of the UK leaving the EU single market but of the way that Brexit has fractured the UK single market. It is also, of course, an eruption of the consequences of the insoluble ‘Northern Ireland Trilemma’. But it is particularly fascinating because the business economics of NFEU labels point in contradictory directions.

For some firms, in some respects, it is quite desirable for NFEU to apply in GB, given that it applies in the NI. If they are selling in both territories then it reduces costs, as it avoids having to have different labels, and increases flexibility, as it allows stock to be distributed to wherever in the UK it is needed. This would be the case for those supermarket chains which extend across the UK, for example, and, indeed, there was some business lobbying of government to introduce the GB policy. It also explains why some chains began to implement the policy before it was legally required.

Against that, however, is the fact that mistaken as it is, the impression that the goods marked NFEU are sub-standard may deter some consumers from purchasing them. I suppose they might be offset by fanatically pro-Brexit consumers, who read the label as denoting some special Brexity product, denied to envious continentals, but it is surely hard to imagine them to be very numerous. Meanwhile, for firms which only sell in GB, including chains which have no presence in NI, there is no upside to NFEU, only downside. Hence there has also been business lobbying to abandon the GB policy.

It's probably sensible to have postponed, and very likely to have halted, NFEU labels for GB, but doing so will inevitably provoke unionist grievance in NI. And, as with the postponement of UKCA marking, it is another case where those firms which incurred costs to comply in advance of the now abandoned deadlines have wasted money. That may not amount to much in the overall scheme of Brexit costs, but it’s yet another example of how those costs just keep mounting, and how even modest attempts to reduce them are not, themselves, cost-free.

The bigger picture

One of the difficulties of analysing Brexit is that it is hard (and, for any one individual, I would say it is impossible), to grasp it in its totality. That is mainly because of its scale and the technical complexity of each of its elements, but also because of the ways in which those elements interact and interlink with each other.

For example, in relation to this post, the need for NFEU labeling would disappear if there were to be an SPS agreement, and I assume that this is what the government hopes will ultimately be its fate. By extension, this is one reason why the EU is likely to be amenable to an SPS agreement. For the original offer of one was made in the context of the then ongoing row about the Northern Ireland Protocol and it arose because the EU has a strategic and principled interest in ameliorating the problem Brexit created for Ireland, as was demonstrated from the very first days after the referendum result. It is unclear that this interest exists in relation to any other regulatory area.

There is also a potential interrelationship with the PRMB, because although we don’t yet know its full ambit, we do know the areas it will exclude, as they are listed in a schedule at the end of the Bill. For the most part, they are things like food, plants, and products or by-products of animal origin: in short, the kinds of products that SPS regulations relate to, and, moreover, listed with reference to their definitions in EU law. No reason is given for their exclusion so this is pure, very possibly stupid, speculation on my part, but I wonder if it is because the government anticipates an SPS deal with the EU which would entail standards for these products being dynamically aligned with the EUs and, as such, treated separately from all other product standards?

Whether or not that is the case, the wider point is that with which I began, and which I’ve written about in the last couple of posts: the government’s lack of a post-Brexit strategy. For the implication of the interlinked nature of Brexit issues is that they are not really amenable to piece-by-piece attempts to accommodate to being out of the EU. Whilst that strategic absence persists, there will still be plenty of Brexit news to discuss but it won’t add up to a coherent picture and, in the absence of that, many of the old debates will continue.

This is the first post of the ninth year I have been writing this blog. There’s still little sign Britain has accommodated itself to Brexit, or even has any idea of how to do so.

 

*A more extensive acknowledgement of this reality could lead, even within Labour’s red lines, to a new post-Brexit settlement along the lines of the Ukraine model. If it is objected (let’s go round the loop again) that this would make the UK a rule-taker, then it would show a failure to recognize that, as things stand, the UK is already a de facto rule-taker, but with few of the benefits.

51 comments:

  1. "Manson House" - Freudian typo?

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    1. :-) very good. Now corrected.

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    2. Will you please send Starmer and Reeves a copy of The March of Folly by Barbara W Tuchman. Please Google it on Goodreads. A Brexit chapter is needed.

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  2. Chris...would all EU Member States have to agree to an SPS agreement with the UK?

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    1. Trade is a competence of the commission, so no. It would also benefit EU food producers who are politically very important, so my feeling is that is very do-able. On the UK side, food is the biggest manufacturing industry so definitely worthwhile.

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    2. Short answer is yes. The whole rationale of the EU internal market (the single market) is that every part in the huge geographic area covered by the EU is considered as being ‘domestic’ and under exactly the same terms of trade.

      All EU members are also in the customs union which means they have exactly the same conditions of trade with third parties such as the UK.
      It’s simply not possible for any EU member to have a separate bilateral trade deal with a third party.
      When you see reports of Starmer seeking a trade deal with Germany all that means is that Germany will try to facilitate trade with the UK as much as possible under the terms of the TCA but nothing else.

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    3. Well, the member states would have to approve any SPS deal via the Council, so there would need to be a QM of member states. But no unanimity.

      The Parliament as well of course.

      I don't think an SPS deal is out of reach. The EU Commission already offered one before, and it wouldn't have done so if the necessary majorities weren't clear.

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    4. Actually no, I think an SPS deal would be a mixed one, requiring unanimity.

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    5. This document [1] lists SPS as a "technical barrier to trade" which falls under exclusive EU competence.

      Which makes sense, since you really don't want these sorts of technical barriers to differ between members. That would defeat the point.

      [1] https://respect.eui.eu/wp-content/uploads/sites/6/2022/02/to_mix_or_not_to_mix.pdf

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  3. This is something I posted on Facebook 7 years ago today. Dare I say it, still relevant.

    ''The recent suggestions that remainers are not patriotic is downright offensive and for Mayhem to say in her Florence speech that the Brits have not been very comfortable in the EU is ridiculous. Some of the media (The Daily Hate Mail,The Torygraph etc) maybe, but not in my name and at least 35% of a gerrymandered electorate. The badly thought out advisory referendum was a snapshot of some opinions in June last year. There was absolutely no discussion of a whole raft of different items, such as, the Irish border question, Scotland and NI voting to remain, the EHIC, the European Medicines Agency, Euratom, EU workers in the UK, British nationals living and working in the EU, large swathes of companies considering their position in this country, having to pay a huge sum to leave, removal of one's European citizenship, trade deals which in the light of the US ruling on Bombardier may not be as easy to obtain (where are you now Dr Fox?), and so on. The list is endlessly complex. It is clear that the devaluation of the pound has caused inflation which has made us all poorer. Did the over 65s and others vote for this sorry state of affairs? Of course not, hardly anyone had any proper information, just lies and miss-selling, now being re-perpetrated by Pinocchio Johnson. Now that we have access to a few facts, I think the result would be very different. We have a useless unfocused government in office (not in power!) trying to negotiate the impossible. This lack of focus means that the country is deteriorating fairly rapidly. The Labour party are just as confused and the whole country is totally divided. What a cock up!''




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  4. Good morning, I have been following you from Italy for several years, mainly for fear that even here pro-Putin and anti-EU parties will let us out.
    I would like to give you a piece of advice to improve your analysis: try to look for news about Brexit in the EU media. For example, here in Italy, interest in the UK is at the level of other third countries, such as Albania. But every time one of your prime ministers starts to get something, the news is automatically translated by YOUR media: maybe the average reader of the Telegraph or Guardian likes "The 5th world economic power is about to get everything it wants from Brussels" but here the effect is annoying, almost offensive. A third country that after 4 years fails to respect the agreements signed, shows up and claims to be in charge? And after that, months of silence, other big announcements of "agreements better than EU member states" and more silence, with the result of having to deal with clowns.
    One thing you will find, certainly not translated by the UK media, are the complaints of companies that have problems with your controls -voluntarily- poorly implemented with outbursts of truck drivers treated very badly, companies that cannot find transporters. And no trade association is asking you to give the UK special treatment at EU level but for your government to behave decently.
    One thing you won't find since 2016 are sites and blogs about Italians studying in the UK with advice on how to enroll, reach institutes, etc. Also because those expensive schools give pieces of paper without legal value in the EU.
    Thank you for your attention, Federico

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  5. Sterling has risen to approx euro1.20 and $1.34, and the UK growth figures are being revised fractionally higher - leading to plenty of "Remoaner" bashing in the Brexit tabloids !
    For what it's worth, my guess is this will soon be revealed as a rush of hot money into an inflation sticky currency, with low quality/low margin growth - which does little or nothing to set the economy on a higher productivity path where we can credibly raise living standards, improve aged infrastructure or certainly pay down perilously high debt.
    The question is, do Labour really think this will work ? Or is it a case of continuing to try and push water uphill for the sake of political optics - before seeking a fresh mandate to pivot on the SM and CU ? I keep changing my mind on the answer to this !

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    1. More to do with the US and EU interest rate cuts I would suggest.

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    2. That's the point. The B of E is cautious about reducing rates due to inflationary impact on a predominantly consumer debt driven economy.

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    3. Labour's fear of discussing Brexit, especially with the next Tory leader still unchosen - and therefore the Tories' relationship with Reform still unknown now that the latter party has deeply split the Tories' core vote, making it impossible for the Tories to win elections under FPTP - is likely due to a deep fear of the issue being used by those parties to attack Labour to try and divide their core vote.

      As I have told Chris before, painful memories of Labour's miserable experience in Scotland after 2014 are probably playing a big role in their decision making over Brexit. Tens of thousands of traditional Scottish Labour voters voted "Yes" to Scottish Independence in 2014. Deciding to do so completely changed their political loyalties and choices. Wanting Scotland to leave the UK, they saw no point - whatsoever - in continuing to vote for Labour, an attitude reinforced by revulsion at the sight of Labour sharing a platform with the Tories during the 2014 pro-UK 'Better Together' campaign (memories of the Tories' attitude towards Scotland under Thatcher and their opposition to Devolution are long here). So they promptly dumped Labour for the SNP, causing a devastating general election defeat in 2015 when the SNP took 40 of Labour's previous 41 seats at WM. In the country of their founding, Labour were reduced to a total irrelevance, and this only got worse as they tried desperately to win back those lost voters by appearing to go soft on supporting the UK Union. The result? They began to alienate their pro-UK voters and, sensing an opportunity after decades in the wilderness, the Tories pounced and proclaimed that only they "could be trusted on the Union." So, Labour began to lose even more voters to the Tories, resulting in a second disastrous election defeat in 2016, when the Tories humiliated Labour by pushing them into third place at Holyrood.

      All of this happened because, for many, many people in Scotland, the identity that we had chosen during the 2014 referendum debate became a critical part of how we saw ourselves in the world. Previous political loyalties just didn't matter any more, as parties which reflected our new sense of identity became the only choice possible.

      The fact that the Brexit referendum debate is still exerting such a strong influence 8 years after the vote took place clearly shows the dangers for Labour in trying to discuss Brexit at the present time. Reform and the Tories need to take Labour voters away from Labour to make any progress in increasing their number of MPs in WM (although the Tories, very unwisely, seem to be ignoring the threat from the Lib Dems, a very similar mistake to that made by Labour in Scotland as they tried to win back the lost Yes voters by appearing to reduce their support for the Union). Labour losing their Leave voters to the Tories and Reform - which is entirely possible due to Reform now being in second place in 89 current Labour seats - would have devastating consequences, making whole areas of the country unwinnable for them. Having, seemingly, learned from what happened in Scotland, Labour are not repeating the mistakes that they made there. In stark contrast, the Tories now seem destined to repeat them by lurching to the right to try and get back the voters that they've lost to Reform, ignoring the voters that they've also lost to the Lib Dems who are not likely to return if they don't agree with a hard-right Tory party....

      To sum-up, Labour's awkward, uneasy attitude to Brexit is due to recent history making them only too aware of the sheer dangers caused by referendum identities clashing head-on with previous political identities in a FPTP election system, and the long-lasting consequences if they do.

      Labour have to tread very carefully here, they have no choice.

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    4. The reason the referendum debate is still exerting such a strong influence 8 years on is that it is far more important than most of us ever imagined. Remember all that talk about the "country coming together", or younger people eventually naturally converting to Brexitism in the way they traditionally convert to free market economics as they get older ?
      There is a fundamental difference to Scottish independence in that Europe and Brexit were never major or fundamental concerns of British people. (Which isn't to say this isn't influencing Labour's thinking, as you argue.)

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    5. Scottish Independence was not a concern to most of the Scottish electorate, until the referendum was called and the resulting debate about what Scotland is, and what it should be, forced them to take it seriously, and make a huge choice based on beliefs, emotions and feelings of identity. I was there. I lived through it. I lost lifelong friends as a result, because we fell-out after a fundamental difference of identity arise between us, and we began seeing each other as a threat. Exactly the same things happened during the Brexit referendum and its painful, chaotic aftermath. Changes in people's feelings of identity can profoundly impact their political loyalties. This is what Labour discovered after 2014, with shattering electoral consequences which lasted for 9 years. Given the close similarities between the 2 referendums, it is inconceivable that what happened to Labour in Scotland is not having a major influence on their thinking now.

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  6. It seems clear that the UK would benefit greatly if it could just stop referencing Brexit and, in effect, hold a national conversation along the lines of 'Given our current situation, what should we do to best improve our economy and the livelihoods of our people?'.
    Unfortunately on this issue, the country is stuck living in the past: Labour apparently unwillingly and the Conservatives demandingly. The conservative media and those further to the right are unwilling to change the conversation as they find it comforting or satisfying to bash those they disagree with.
    Nothing substantive will change about UK politics until the basis for conversation changes - and perhaps not even then. This is both upsetting and boring at the same time.

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  7. What really annoys me is that most of these problems were highlighted during period before referendum and rubbished by a bunch of lying charlatans as “project fear”.MSM was also culpable in that they allowed brexit optimism to go unchallenged.

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  8. It cannot be said enough, thank you Chris for your excellent analysis and concise reporting.

    It is all very depressing to see a country destroy itself because it cannot come to terms with the mistake that has been made.

    Let's be frank, in the grand scheme of things, there are no benefits whatsoever in not being an EU member. The UK however, was not just an EU member, it had a seat in the cockpit.

    Destroyed to keep the Tory party whole, and they subsequently destroyed themselves because of it.

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    1. Even more depressing for us old codgers. Not only are we expected to be Tories (ugh!) but things aren’t going to get better in our lifetimes. If I only I could find an Irish grandparent. I could become Irish and never have to explain my hearty dislike of GSTK.

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    2. I guess you are using "Irish grandparent" as a short hand for "ancestors from an EU country, however, I am often surprised how few consider that other countries have comparable rules.

      A Brazilian friend of mine got Italian citizenship by virtue of one grandparent having been an Italian.

      British comedian Stephen Fry most famously became Austrian recently due to the tragedy of one of his ancestors having to flee Austria some when between 1938 and 1945.

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    3. Indeed, in 2009 after living in Germany for 28 years I applied for German citizenship, with dual nationality, and, due to EU rules, was accepted immediately. I have never regretted it, but must constantly explain to my German friends that “blood is thicker than water” and my forebodings over GB cannot be ignored.
      Thank you, Chris, for your clear analysis and warning s of the situation!
      John Brown

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  9. Congratulations on 9 years! I am very confident that you will still be blogging in another 9 years and, I am sad to say, equally confident that you be writing on similar topics.

    My thoughts are turning towards who is going to pay for Brexit. Both the current and previous governments seem to be pretty keen on being people like me who are investors and run businesses. I'm very keen not to be footing the bill.

    While there's no realistic of Brexit ending for decades for Britain, I am able to end Brexit for myself at the end of this tax year.

    Almost as soon as I'd started filling in the forms, I felt a weight being lifted off. I can absolutely understand why so many other wealthy and skilled people are joining me in the departure lounge.

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    1. "My thoughts are turning towards who is going to pay for Brexit"

      Surely the answer is 'absolutely everyone' !

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    2. Not really. Some groups were selected for special treatment, pensioners were the only group to end up better off with the triple lock and a promise from the Conservatives to introduce a new lower rate of income tax only for pensioners, so that they would escape the tax rises.

      Business meanwhile was hit with a 25% increase in corporation tax, taking the rate above our key competitors in the EU. The minimum wage was raised to the second highest in Europe behind only Luxembourg and way ahead of France and Germany. Energy prices for business were rocketed to subsidise consumers. Infrastructure investment was cut in real terms and private investment banned.

      The strategy is for Britain to compete with the EU by having higher tax, more expensive regulation, higher input costs and worse infrastructure.

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  10. I feel you are hinting at the many technical changes that would go over the heads of 99% of the electorate. And might get through without triggering apoplexy in the right wing press.

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    1. Sadly, there's little chance of that. Anything EU-related they don't understand will be treated as "Betrayal!" They are still thoroughly behind one of the purposes of Brexit: blaming economic equality on the EU, instead of the outsourcing of manufacturing and the greed of the wealthy. Jeremy Corbyn seems to have thought he could turn Brexit voters into Labour voters once it was obvious that Brexit wasn't solving anything.

      There's an interesting secondary trade effect: US companies no longer willing to sell to the UK now that it involves a separate set of rules and paperwork. We aren't a big enough market to be worthwhile for them in some fields.

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    2. Yes, I really miss Orvis in particular.

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  11. _That is perhaps slightly different to ignoring Brexit, as it is a kind of acknowledgement of Jumbo’s existence alongside a dogged determination to live with it._

    Unfortunately Nellie is still likely to eat all your bananas and shit on the carpet.

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  12. In deciding to pretend that it is perfectly sensible for the country to be outside the EU, Starmer has effectively committed himself to the claim that most Labour Party leaders since the 1970s, who did not think this was sensible, were mistaken. He would probably hate to have to defend this claim, so he is naturally going to say as little as possible about Brexit in the hope that nobody notices this.

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  13. Viewed from outside the UK, the UK's current trajectory is sad. It is increasingly obvious that there will be no relief in the near term from a downward spiral towards economic hardship and declining international irrelevance. It has been obvious for some time that the Conservative Party lacks the fundamental intelligence to pursue policies that would benefit the UK both economically and socially.

    Like many, I suspect, I harboured a vague hope that the Labour Party possessed collectively a breadth of education and intelligence adequate to the task of rescuing the UK, with the possibility that 14 years of study from the Opposition benches would have generated an awareness of the problems and the routes to their amelioration.

    But we have now discovered that the emperor has few if any clothes. Labour's time in Opposition, as an educational opportunity, has largely been wasted. I attribute this both to the fundamental mediocrity of the current Labour Party and the curious time warp engendered by the Party's history. It is like watching a J B Priestley play with its out-of-date political aspirations.

    Starmer encapsulates all its lack of any real political nous. It is increasingly obvious that this narrow, gauche, politically-inept man and his chums are fundamentally incapable of rescuing Britain from the trap it has set itself. And the LibDems are no better.

    My guess is it will take another decade for the current crop of oldies to die off and to shift the dial sufficiently for real progress to be made. When it is made, it won't just be seen as 14 wasted years, but more like 25.

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    1. The one thing that does make me feel more positive is young people. On pretty much ever issue young people are right and my generation, or the generation older than me, is wrong.

      It would be much more worrying if it was the other way round.

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    2. In the recent Austrian elections it does seem to have been the other way around.

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    3. This comment has been removed by a blog administrator.

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    4. Sorry it was actually the AfD and the recent elections in Thüringia. They were assiduously courting the young on TikTok. But it would not surprise me if the same were true in Austria.

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  14. It looks like Starmer is wasting his time with talk about resetting relations with EU and being friends again and cooperating..
    Reminds me of the sheiks of Middle Eastern countries meeting at their GCC summits, discussing irrelevant bilateral relations , publishing their bluster for home consumption, and carrying on as usual.
    As for EU nations they have interests , not friends and relationships. Hungary and Romania are not friends but both their interests are fully committed to the EU.
    As for Starmers cooperation with EU ..that's what the C in the TCA brexit deal stands for.
    Best thing Starmer can do is stop the brexit rot of the UK rentier economy that can no longer exploit the EU single market on their terms, cooperate and implement the TCA , stop any talk of terminating retained EU laws and implement laws that enable alignment with EU, avoiding divergence(sounds like he's trying that)
    Just stopping the brexit rot is a huge task but more important he needs to analyse the decline due to poor productivity since 2008 as a first step to economic reforms to UK.

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  15. Mocking lamentations about delicatessen is not 'the politics of envy'; it is a response to the overheated hysteria of the Brexit Wars. Millions of Leave voters were told that the consequences of Brexit would be so catastrophic that they must be stupid, ignorant, evil, or at best extremely gullible.

    And then it turns out that this Disaster largely affects delicatessen. Come on, it's a little funny...

    The discussion of mutual recognition of professional qualifications seems off point. The Government's aim is not necessarily a reset with the EU but a reset with Europe. It is pursuing bilaterals with individual member states on trade in services, rather than necessarily with the EU as a bloc.

    Germany -- who recently signed a mobility bilateral with Kenya -- is negotiating a bilateral with the UK for 'increased people-to-people contacts'. Spain offered a mobility bilateral at the EPC meeting in the summer.

    Most professional qualifications are regulated by the member states rather than the EU, as there's insufficient consensus across EU27 about what counts as sufficient quality and training for professional services. Therefore it's largely up to member states to declare if they see UK professionals as equivalent in quality.

    Labour seem to be trying to bypass the EU and sign bilaterals for mobility and professional qualifications with strategic individual member states rather than the bloc entire.

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    1. Well, they were gullible. As are you if you seriously think that the negative effects of Brexit largely affect delicatessen. Not sure where you got that from, but hey...

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    2. If, as you say, the government is "pursuing bilaterals with individual member states on trade in services", then it is as delusional as the previous government and their "individual deals with US states".

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    3. Kevin Krammer, you seem unaware that EU member states are not akin to the states of the USA. Pertinently, immigration from non-EU countries such as the UK are under the control of the member states themselves.

      Germany has just signed a mobility agreement with Kenya that involves the mutual recognition of qualifications:

      “ Both governments will support the immigration of skilled workers who have finished vocational training or earned a university degree, as long as their qualifications are recognised by the relevant authorities of the other party.”

      Germany to welcome Kenyans in labour deal https://www.bbc.com/news/articles/c4gegkkg14ko

      The agreement on mobility and recognition of qualifications will likely boost services trade between the countries.

      Germany is currently negotiating a bilateral with the UK that also involves “increased people-to-people contacts”.

      We’ll see what results, but I suggest looking at the UK’s post-Brexit mobility bilateral with Switzerland to see what it could look like.

      https://www.gov.uk/government/publications/uk-switzerland-services-mobility-agreement-benefits-for-the-uk/uk-switzerland-services-mobility-agreement-explainer

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    4. I am aware, I was commenting on the quoted part of the other post.

      Yes, immigration is a member competency, but trade is a union competency, just like in the USA.

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    5. Trade in goods is an EU competency, but the Single Market for services is notoriously patchy in its coverage and vast swathes are essentially controlled by the member states. As pointed out above.

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    6. The real practical difference is that is a mobility agreement between the UK and Germany only means that people in the UK who want to live/work in Germany are limited to German jobs that don't involve working travel anywhere else in the EU, or require training anywhere else in the EU.

      So if you from the UK want to work as an architect in Germany, the company you work for can't use you for any jobs that are outside Germany. There are many businesses for which that isn't an issue, but there are also many businesses who don't want the hassle. Especially when literally anyone else with an EU passport doesn't have these restrictions.

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  16. I would humbly suggest that step 1 is to put a bullet in the word "Brexit". It obscures what it was never intended to reveal. To wit:
    Q: What is "Brexit"?
    A: A portmanteau of "British Exit".
    Q: ah. Exit from what?
    A: the European Union
    Q: ah. And that has happened, right? I think I saw something in the papers..
    A: quite right.
    Q: so why are we talking about it then? Its a done deal, water under the bridge, joined the choir invisible, an ex-Brexit.
    A: yes.
    Q: so what comes next?
    A: a horrificaly complex job of replacing all the economic, trade, and political relationships embedded in being a member of the EU, which we don't belong to anymore.
    Q: so, shouldn't we be talking about that?
    A: ummm...

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  17. At the time of Brexit, commentators mentioned a number of possible impacts on UK exports of rules of origin (ROO) in the context of UK-EU supply chains. UK exporters might not be able to take advantage of the new UK FTAs replacing EU FTAs because reliance on EU supply chains would mean their products would not have sufficient UK content to qualify for tariff or quota free access (when they would have qualified as having sufficient EU content under the former EU FTAs) - meaning that rollover FTAs are less valuable to UK exporters than the predecessor EU FTAs and that UK exporters might want to cut EU suppliers out their supply chains (although it might be difficult in some cases to find UK replacements).But ROOs in the EU’s FTAs also might result in EU exporters cutting UK suppliers out of their supply chains to ensure that their EU exports have sufficient EU content to qualify under EU FTAs (and it might be relatively easier for them to substitute EU suppliers than for UK exporters to do so). The (excellent) Aston study refers to the impact of ROOs but does not explore these impacts in detail or the possible merits of seeking to join cumulation arrangements such as the EU’s PEM Convention. Are you aware of other studies on these impacts and possibilities?

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  18. I would be interested in your comment on the other Brexit news last week that the new government has taken the step of revoking the commencement regulations made by the previous government bringing into force section 6 (role of courts) of the Retained EU Law (Revocation and Reform) Act so that that section will no longer enter into force on 1 October 2024. The government has offered no explanation of the its policy behind the revocation.

    The absence of comment may be intended to reduce the risk of a legal challenge of the kind being made by the Free Speech Union to the government's announcement of its intention to 'stop' the implementation of the Higher Education (Freedom of Speech) Act 2023, also enacted under the previous government, by revoking previously made commencement regulations. The Free Speech Union's letter of claim relies in part on R v Home Department, ex p Fire Brigades Union [1995] UKHL 3 but there is probably plenty of precedent for a government simply delaying commencement of unwanted legislation almost indefinitely until it can be repealed.

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  19. Prof. Grey's conclusion:- "This is the first post of the ninth year I have been writing this blog. There’s still little sign Britain has accommodated itself to Brexit, or even has any idea of how to do so."

    In the referendum campaign, people like Gove and Johnson claimed that it would be possible to leave the EU with little economic harm because it would be possible to get a great deal, the EU needed us more than we needed the EU, the UK could have its cake and eat it too. There was little push-back against this at the time. We now know that the UK hasn't managed to have its cake and eat it, that the UK did not have the leverage to get concessions out of the EU and that leaving the golf club because you don't like the rules means that your access to golf-playing opportunities are significantly diminished. The EU considers that the UK had accepted, and indeed written, the rules that the UK didn't like and claimed were imposed on the UK.

    There was a curious interview of Robert Peston in the Guardian.

    https://www.theguardian.com/media/2024/sep/17/robert-peston-inequality-identity-politics-how-to-heal-britain-itv

    In it he admits that the media did not do a good job of holding politicians to account over Brexit but then at the end says that he has to give politicians a fair hearing. Just before that he says that the priority now is to heal the country's divisions. I would have thought that the priority now is to assess what happened over the last year, now that the results are in, but that would appear not to be Peston's priority.

    There appears to be no public admission that leaving the club but still playing golf at 11.00 am on a sunny Sunday was never on the cards (nor was staying in the EU but opting-out of FoM). There appears to be no public admission that the UK helped to create the rules that it then claimed were imposed on it. Until that happens, there can be little accommodation to the realities of Brexit.

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  20. @Paul Robson. Thanks for the comment and I agree that the majority in GB have not absorbed what Brexit means and still think ‘we will muddle through’,

    As to the views of Robert Peston he has always been ambiguous and thus maybe due to his position in the media whereby his bosses at ITV demand both-siderism so as to somehow appear non biased.

    That being said I’ve followed his comments for a long time and in my book he was a Brexiter who is now backpedaling.

    Nowadays his comments are along the lines of ‘it’s done and there’s no going back so we must stop complaining and make Brexit a success’.
    It’s an increasingly common attitude I find from Brexiters even the hardliners and it’s a way of sidestepping any responsibility.

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    1. I rarely watch TV so don't have a view about what Peston's personal opinions are (or have been). He says we now need a period of healing; I say that we now know that the UK hasn't leveraged a settlement in which the UK has the exact same benefits without the rules and we should now be holding to account the people who claimed that the did have that leverage and could get such a settlement.

      I see that Johnson B. has a book out and it is getting some publicity in the media. In the Mail it was under a big headline about "Punishment Beatings" and Johnson was given the opportunity to push the fallacy that the UK didn't get one of these great deals because the rest of the EU wanted to be mean to us.

      There isn't going to be the period of healing that Peston claims is needed: people like Johnson are going to continue to push the nonsense that the UK was oppressed in the EU and that is also the reason that, after leaving, the EU didn't allow the UK to keep all the benefits without the costs. Isn't it Peston's job to point out that this is illogical?

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    2. @PAUL ROBSON, thanks for the reply, you were on point about Johnson. I see reports that in his book he plainly states that the reason Brexit has failed is that the EU decided to punish the UK and that his ‘have cake & eat it’ proposals where perfectly reasonable.
      The depths of lies that Johnson is capable of have not been plumbed

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