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Getting Brexit Started – Does the General Election Result Change Johnson’s EU Strategy?

Now that Boris Johnson will be leading a government with a sizeable majority in the House of Commons, some degree of normality will return to British politics. That normality is that governments get to govern with little capacity for the Westminster Parliament to block the will of the Executive. Whatever happens on the Opposition side – including the sizeable block of Scottish National Party MPs – nothing changes the fact that the Johnson Government now has, more or less, a free hand in both its domestic and European policy agendas. On Brexit, this has some interesting implications.

There has been some speculation that the political freedom the Prime Minister will enjoy will allow him to reveal his “true self” and to pursue a policy on Brexit that is less beholden to the extreme Eurosceptic elements in his own party. The argument then runs that we could be looking at a much less “hard” Brexit than the rhetoric might have suggested. For two reasons this assumption looks doubtful.

The first is that the idea that there is a different Boris Johnson waiting to be revealed doesn’t have an obvious basis. That he is prepared to adopt different positions to suit circumstances and to seek political advantage is a better characterisation of his pollical demeanour. That could, of course, mean that the Prime Minister might seek to adjust his Brexit strategy in light of the new political realities but that is not the same as the revelation of an intrinsic and authentic political credo hitherto constrained by prevailing political conditions.

The second reason for doubting a less “hard” Brexit is to do with the problematic characterisation of different choices as “hard” or “soft”. This language suggest a continuum of possibilities with positions hardening or softening. In reality, the choice the Prime Minister will have to make will be much more binary. It’s a choice between a loose “free trade” discipline in which a future EU-UK relationship will be better than World Trade Organisation terms but significantly reduced compared to those of EU membership, and a “free movement” discipline in which the future relationship entails a pre-commitment to regulatory alignment with the EU as a condition for maintaining market access on terms similar to those currently enjoyed. There seems little reason to believe that a Johnson Government will shift from a free trade approach to a free movement approach anytime soon.

The freedom of a working majority in the Commons will also mean that the Prime Minister should be able to re-introduce a Withdrawal Agreement Bill to implement in domestic law the agreement negotiated between the EU and the UK settling the terms of the UK’s withdrawal under Article 50 TEU. Indeed, what will be different this time round is that any attempt to tack on a requirement of a further referendum to approve the Withdrawal Agreement will fail if introduced in the Commons. Of course, the Bill could still encounter headwinds in the House of Lords but while the unelected chamber may express its views it will be unable to prevent the Commons from removing amendments with which it does not agree. All of which will set the stage for the EU and UK to complete the formalities and for the UK to formally withdraw from the European Union on 31 January 2020. But this is when the real work begins.

Far from the Prime Minister having an “oven-ready” Brexit, he barely has the recipe let alone the ingredients.

Even assuming that the Johnson premiership remains committed to doing a less complex trade deal, there will be much for the two sides to negotiate and resolve. Although it is often repeated that these negotiations are made easier by the perfect alignment of the EU and the UK at the point of withdrawal – a position that will be maintained during the transition period that follows withdrawal – that alignment might, paradoxically, make things more difficult. Because in any normal trade negotiations the parties are seeking to improve on the status quo and to upgrade their common interests beyond default international trade rules like those of the WTO. For the EU and the UK, the opposite applies. The trade relationship will be downgraded as the UK gives up market access in order to have greater trade and regulatory autonomy. And in areas like financial services there will be difficult tensions to be resolved. The size and importance of the City of London ought to put the UK in a strong bargaining position with the EU. Yet having gone through a financial and economic crisis and having put in place stronger rules-based governance backed up by new regulatory bodies, the EU will be reluctant to concede to the UK powers of self-regulation unchecked by EU rules and institutions.

There is also a continuing time pressure. If time has shaped Brexit in respect of the process of withdrawal, then it continues to shape Brexit as negotiations on the future relationship get underway. The transition period that begins as soon as the UK leaves the EU is scheduled to end on 31 December 2020. This is the true “No Deal” cliff-edge moment because if there is no new treaty on the future relationship in place and in force on that date, then the EU and UK will default to WTO trade terms (subject to the application of the Protocol on Ireland and Northern Ireland). On the UK side, provided a deal can be done, we ought not to expect too many difficulties in obtaining domestic legislative approval given the size of the Government’s majority in the Commons. However, the EU side may be more difficult as it may be harder to maintain political unity as diverse political and economic interests of EU Member States are revealed and if a negotiated agreement requires domestic approval in all the other EU states (something that was not required for the Article 50 withdrawal agreement). Getting everything in place in one year looks ambitious when we reflect on the problems of the last two and half years.

The EU and the UK have the option to extend the transition period by one or two years. But that option is a one-time option and it must be exercised by 1 July 2020. Throughout the election campaign, the Prime Minister and other senior ministers repeated that they would not seek to exercise that option. This is perhaps one area where the Prime Minister may feel he now has the political capital to change his mind but that may not happen until the last moment with the PM preferring the pressure of time to focus minds and accelerate progress on the negotiations.

So not only is there not an over-ready Brexit, Brexit will not be “done” by 31 January 2020. The UK will no longer be a Member State but it will not have defined its future relationship with the EU and it will be in a period of transition in which the UK will be bound by EU rules till the end of the year. The Prime Minister may now be in a better position domestically to pursue a Brexit policy but he will now have to do the more difficult task of negotiating and delivering a Brexit deal whose impact on the UK economy is the key risk to his ability to deliver on all his other promises including on the National Health Service.

Getting Brexit Done turns out to be Getting Brexit Started.

 

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Is a Pledge of a Brexit Referendum within Six Months Credible?

The election on 12 December will require the political parties to set out their positions on Brexit. Already, Labour is pledging in its ‘Plan for Brexit’ that it will negotiate ‘a sensible deal within three months of being elected’. More dramatically, it also claims it will hold a further Brexit referendum within six months of the election ie sometime in May 2020.

On the first pledge to renegotiate a ‘deal’, this will focus on a new customs union, a close relationship with the Single Market and ‘guarantees of rights and protections’.

What is noteworthy is that these all relate not to the Withdrawal Agreement but to the future relationship which will be negotiated once the UK leaves the EU. These are the sorts of things that have been discussed in the context of the non-binding Political Declaration that will set the framework for those future negotiations.

The EU could be open to that discussion as long as it does not transgress the stipulation laid down in the latest Article 50 extension decision that the EU will not renegotiate the Withdrawal Agreement during the extension period. The problem for the Labour leadership, however, is that means being unable to reopen the Withdrawal Agreement during the period of the current extension.

We have been here before, however, and the second extension decision which kept the UK in the EU to 31 October also contained the same stipulation that the:

‘extension excludes any re-opening of the Withdrawal Agreement’.

Yet following a change in Government in the UK and Boris Johnson’s insistence that the text of the Agreement as it stood would not be passed by the UK House of Commons did lead to a revised agreement being reached during the period of the extension. Nonetheless, the EU might be more insistent on the non-negotiability of its second Withdrawal Agreement especially if it will be asked for a further extension to facilitate another Brexit referendum.

The second claim by Labour in its election pitch is that within six months of being elected it will hold a further referendum. This is more problematic.

As I have explained before, the barriers to a further referendum are numerous, but one of the most obvious ones is time itself. There will need to be time to legislate for a referendum; they don’t just happen. The referendum legislation for the 2016 referendum took seven months to pass. In a further referendum, the issue may be more complicated if moves are made to give voters a wider range of choices than between a Remain option and that of Leaving on a Labour-negotiated deal. Complaints that the referendum would not offer electors either a No Deal option or the choice to approve the Johnson vision of Brexit could both bog down the legislative process and raise issues as to the legitimacy of the referendum. At the limit, voters could be urged to boycott a referendum if it was considered to have rigged the available options.

The question to be put in the referendum would also need to be road-tested by the Electoral Commission. If there was agreement on the structure of the options to be presented to voters that could be done in parallel if the referendum bill also empowered ministers to insert or change the referendum question via statutory instrument. But if there is dispute over how to present the options, then the Electoral Commission might need to wait until a decision was finally taken before then turning to the specific wording of the question.

Even assuming all that could be expedited, far more challenging is the Electoral Commission’s previous best practice approach which anticipates that referendum legislation should be fully in place six month before it is implemented. Note this is before any referendum campaign gets underway. That would see a referendum then being held more than a year after a December 2019 election.

One reason why this six-month gap between completing the legislative process and its implementation might be particularly necessary would be if the franchise were to be extended to 16 and 17 year olds. Time would be needed to mount a registration campaign to ensure that this new group of electors were informed of their right to vote and duly registered. Back in 2016, the website for registration to vote in the EU referendum crashed forcing an extension to the deadline. In order to avoid a reoccurrence of the problem, the Government would need sufficient time for a public information campaign to highlight eligibility to vote and to maximise voter registration.

A request for a further extension to hold a referendum would clearly be necessary given that the current extension expires on 31 January 2020. Once again, the issue for the EU27 will be whether to grant such an extension and for how long. An extension for a further referendum would be difficult for the EU27 to decline. However, a key difficulty for the EU27 would be what might happen if the UK once again voted to leave the EU.

Even assuming that the UK would be in a position to hold a May 2020 referendum and to implement a result to leave the EU – for the sake of argument on 30 June 2020 – the UK and EU would jointly have to decide by 1 July 2020 whether to extend the transition period scheduled to expire on 31 December 2020. To do otherwise would be to leave the EU and UK less than six months to negotiate, agree and conclude agreements on their future relationship. Given the impossibility of that, the UK and EU would face a new No Deal Brexit deadline of 31 December 2020.

One view might be to offer an Article 50 extension to 30 June 2020 on the assumption that a Leave vote could be implemented smoothly and a transition extension also agreed. Others might, however, wonder whether another referendum might trigger yet more domestic politics that would make it less clear whether the UK could leave and enter into a transition period starting on 1 July.

But given what was said earlier, it simply does not seem likely that a UK referendum could occur that fast leaving the EU27 to decide whether to agree to a longer extension to the end of 2020 or even beyond into 2021. A fourth extension in those terms would, in effect render the transition period extension mechanism meaningless and the Withdrawal Agreement would need to be revised to reconsider how any transition period might actually work and on what timescale.

Labour’s Brexit pitch is clear and it is specific. But another referendum in six months stretches credibility.

 

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Getting a Hard Brexit Done -Towards a New Final Destination

With barely two weeks to go to a crunch European summit, the UK Prime Minister Boris Johnson has made his pitch for a revised Irish ‘backstop’ and a new Political Declaration on the future relationship between the EU and the UK. Not surprisingly given that what has been released deals solely with the backstop, the question that journalists have focused upon is whether the idea of an all-Ireland regulatory zone and customs controls away from the North-South border can get a green light from the EU and from the MPs who will need to back the deal.

Under the pressure of time, political and media attention cannot help but be consumed with the here and now. Yet what is fundamentally at stake in all of this is not just what it takes to “Get Brexit Done” but where the UK and the EU are heading in terms of their future relationship. As Jill Rutter has tweeted, what is really significant about Boris Johnson’s letter to departing European Commission President Jean-Claude Juncker is that the softer form of Brexit envisaged by Theresa May – and rejected not just by her own MPs but also Opposition parties – is not what the Johnson Government wants. The shape of Brexit has altered and altered radically from a year ago.

On this blog last year, I suggested that what might be important about the planned backstop was that it was less a safety net and more of a trampoline towards a particular kind of future EU-UK relationship. Indeed, the terms of the Political Declaration implied that a future relationship would build upon a backstop that would keep the whole of the UK and not just Northern Ireland subject to EU rules including “level playing field” regulatory compliance.  Had the Withdrawal Agreement and Political Declaration been approved, the shape of Brexit could have been relatively soft (although a change of government in the UK could, of course, have charted an alternative course). Albeit different from the approach of the European Economic Area Agreement – aka the “Norway model” – a novel and potentially far-reaching type of “association agreement” between the EU and the UK seemed to be on the cards.

The Prime Minister’s new proposal is not just for a revised backstop but for a very different type of future relationship. This had already become clear when the newly appointed Prime Minister Johnson wrote to the European Council President on 19 August. As well as making the now-familiar claim that the backstop was “undemocratic’, the Prime Minister went on that the backstop was “inconsistent with the UK’s desired final destination for a sustainable future relationship with the EU”. In express terms, the Prime Minister stated that UK regulations could in the future diverge from those of the EU; “[T]hat is the point of our exit and our ability to enable this is central to our future democracy”, he said.

In the more recent letter to Jean-Claude Juncker, the abandonment of any type of association agreement in favour of a free trade agreement is made clear and the reasoning that lies behind it is so “that the UK takes control of its own regulatory affairs and trade policy”.

What emerges is a rather interesting picture. The UK will leave the Customs Union and the Single Market and base its future relationship on a free trade agreement. This is a hard Brexit with no pre-commitment to EU regulatory standards underpinned by an agreement with the EU. Which is not to say that other forces will not push towards regulatory convergence: voluntary alignment or the pressure from market actors will have a role to play. But the free movement discipline of pre-committed regulatory alignment will be replaced by a looser free trade discipline that will open a space for regulatory divergence. The exception to this is Northern Ireland. Rather than the backstop acting as a trampoline or trap, it will be an anomaly. The Prime Minister intends that this anomaly – something which the Democratic Unionist Party had apparently sets its face against hence the May version of the backstop – will find its justification in the principle of consent and the willingness of the people of Northern Ireland to accept continuing regulatory alignment in trade in goods. Which begs the question of how consent in the rest of the UK is to be secured for potential regulatory divergence in the future.

It remains to be seen whether the Prime Minister can persuade the leaders of the EU27 to back his plan. But even if they do, can the same MPs who didn’t support Theresa May’s softer Brexit really get behind the harder Brexit that the Prime Minister is clearly pursuing?

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Decision Time – Why Opposition Parties Need to Agree a ‘Brexit Manifesto’

In the Introduction to my book Brexit Time, I observed that Brexit was not the United Kingdom’s ‘manifest destiny’. Rather it was a choice. And it remains a choice.

We have now reached the point where decisive choices can and need to be made. The options are clear. Under the Johnson Government, the option of No Deal Brexit is actively being pursued. For the opposition parties the options are either for the UK to remain in the European Union or to exit on terms that will see the UK maintain a close alignment and cooperation with the EU.

These are not new options. What is new is that there is now a clear path towards finally making a decision.

The first step is to force the Conservative Government to seek a mandate for a No Deal Brexit through a General Election. That means preventing the Prime Minister from either proroguing Parliament or choosing the date of a General Election beyond the 31 October deadline after which the UK would automatically crash out of the EU.

Before a General Election can take place, MPs will have to pass a motion of no confidence in Boris Johnson’s Government AND form a unity government. Although there has been speculation and controversy over who might lead that unity government, what is more important is what steps it puts in place for a General Election that would allow the electorate to either back a Conservative No Deal Brexit, or pave the way for the other two options – Remain or a softer Brexit – to be tested.

In order for there to be General Election before the UK automatically leaves the EU on 31 October, a further extension to the Article 50 process might well be needed. Nonetheless, for yet another extension to be granted – the third such extension – the EU will want to know that a General Election is likely to produce more rather than less certainty. That means that opposition parties need to agree not just a unity government to take control over the process, but a unity position on the substantive alternatives to a No Deal Brexit.

This is why I think the opposition parties need to come up with a common ‘Brexit manifesto’ to contest a General Election. This would not, of course, replace the party manifestos; after all, a General Election would be about more than just Brexit. But when it comes to outlining the party positions on Brexit, the opposition parties need to agree a common platform.

The difficulty for the opposition parties is the split between those for whom the only viable option is for the UK to remain an EU Member State and those for whom a Brexit alternative based on a Withdrawal Agreement, transition and close future relationship with the EU is a credible option.

The Liberal Democrats might want to maintain the clarity of their current pro-Remain position which has seen them make advances in the polls. The problem with that is two fold. For the Lib Dems a simple Revoke-Remain strategy is not going to attract them the votes of Conservatives for whom Brexit is still their preference but not a No Deal Brexit. Unless they are prepared to accept a compromise position – and with it being highly unlikely that traditional Conservative voters would switch instead to a Corbyn-led Labour Party – those Conservative Leave voters may feel they have no alternative to backing a No Deal Conservative Party under Boris Johnson. For the Labour Party, MPs in Leave-voting constituencies are unlikely to get behind a Brexit manifesto that simply gives voters a choice between a No Deal Brexit or a Revoke-Remain alternative.

My proposal is that the opposition parties unite around offering voters a second step in the form of a referendum with a straight choice between Remain and a Brexit that would keep the UK in the Single Market and a partner with the EU on other forms of cooperation including security. The option of a No Deal Brexit would not need to be put in a referendum because the preceding General Election would either have seen that option accepted – with a Johnson government having a fresh mandate – or it would have been rejected.

This approach allows the key choices to be made. If Boris Johnson wins a General Election he will have a mandate to pursue his preferred form of Brexit. If he loses and either one of the opposition parties has a majority or some type of coalition is formed, the new government would be committed to giving voters a final choice between staying in the EU or leaving the EU but under different terms. Voters would know that this alternative to a No Deal would be on offer regardless of which opposition party they voted for.

It is clear that Labour is backing a strategy of a General Election followed by a referendum. It is imperative that this becomes a shared strategy of the opposition parties.

For this strategy to be viable there does need to be greater clarity and agreement about what a credible alternative Leave option might look like. My own view is that an EEA model is a credible alternative in securing continuing access to the Single Market. It would eliminate customs duties between the UK and the EU and maintain regulatory alignment not just at the point of departure but over time. There are understandable grounds for reticence about the EEA Agreement given that it is almost thirty years old. It would be helpful if the incoming European Commission could signal its willingness to review the operation of the EEA Agreement and how it might be adjusted in light of developments in the last three decades and as the EU reflects on its own future institutional architecture and relations with its near neighbours.

The challenge for the opposition parties would be to approve a Withdrawal Agreement that they have otherwise opposed. The basis for a change of position would be a very different vision of the future for the UK as a whole and a credible alternative to the backstop underpinned by the principle of consent.

Under the Withdrawal Agreement, the UK would enter into a transition period ending on 31 December 2020 or later if it is extended. It is conceivable that an EEA-type future relationship could be ready to commence on 1 January 2021 or a year or two later if a deeper review of the EEA approach was to be undertaken.

During the transition period, Northern Ireland would be in the same position as the rest of the UK with EU customs and Single Market rules applicable during the transition period. Thereafter, an EEA-style agreement would avoid the need for frontier regulatory controls on the island of Ireland but as the EEA Agreement does not create a Customs Union a different approach would need to be considered to secure the avoidance of a hard border. To that end, the UK and the EU should commit to negotiating an agreement to replace the ‘backstop’ under the Withdrawal Agreement to keep Northern Ireland within EU customs arrangements (in addition to its participation in the Single Market through an EEA-style agreement). This new agreement should be the subject of a referendum in Northern Ireland, thereby ensuring that the Good Friday Agreement principle of consent would apply to any difference in approach between Northern Ireland and the rest of the UK. To avoid the Withdrawal Agreement backstop provisions being triggered, this new agreement and a referendum to approve it would need to be in place during the transition period.

All of which will require strong signals from the EU as to its willingness not just to pursue this alternative Brexit but also to implement the steps necessary to ensure that a transition will be successful. This will entail revisiting and revising the text of the Political Declaration to reflect different Brexit priorities. My own view as expressed in an earlier outline proposal is that an ‘Implementation Protocol’ to be added to the Withdrawal Agreement would give confidence as to the commitment of the EU and the UK to move from the status quo to a new set of arrangements.

It is only by offering a credible alternative Brexit that a future referendum choice between Remain and Leave can legitimately respect the interests of voters. Leave voters will have the opportunity in a General Election to vote for No Deal if that’s what they want and again to vote for a different type of Brexit – or indeed to Remain – if Boris Johnson is unable to form a government after an election. Remain voters will know that whatever opposition parties they vote for, the option of remaining in the EU will be put to them in a future referendum alongside a compromise Brexit which they might not want but which would be preferable to a No Deal Brexit.

A General Election is the legitimate way to approve or reject a No Deal Brexit. And if it is rejected, it is only right that voters can choose between remaining in the EU or leaving with a credible alternative Brexit.

Finally, choices can be made that will be both decisive and legitimate.