This week the government worried about a second wave of Covid-19, while the media continued to suffer a second wave of a rather different disease: No Deal phobia. As ever, this has for the most part involved a lot of fuss about not very much.
That said, the government has not helped itself with the rather brazen admission of plans to break international law in a ‘specific and limited way’ this week. This was not delivered with any explanation and not by the Attorney General. As everyone everywhere has pointed out, this is a strange defence, begging the question of why we can’t choose to break the law in a ‘specific and limited way’ by meeting as a group of seven at Aunt Mildred’s house next Sunday.
The controversial bill in question is the Internal Market Bill, designed to establish a post-Brexit basis for trade within the UK. Tacked onto this was the offending section seeking to escape from three pretty objectionable aspects of Withdrawal Agreement’s Irish Protocol. These included the pointless stipulation that Northern Ireland businesses fill in customs declarations for everything they sell to GB. Another is the Protocol’s implication that government assistance to businesses in GB be vetted by Brussels in case goods from assisted firms leak into the EU via NI. Finally, the UK wants the final say on which goods exported from GB to NI are at risk of crossing the unmanned Irish land border.
Much, or at least some, of this might have been achievable by further negotiation but as the clock-watching Mr Barnier might say ‘ze clock is ticking’, and no such agreement had been reached. The EU should have been sensitive to the over-reach in the Withdrawal Agreement, but sensitivity has not been its strong point to say the least. The Internal Market Bill has allowed the EU to take the high moral ground, backed not only of course by what Robert Tombs calls the ‘Remainer Undead’ but also by some high Tories with high principles. All of these objectors address the principle of adherence to law. None address the substance of the issues.
So why has the government opened up this can of worms? Presumably, it wants to make a dramatic stand, showing off its resistance to EU dictates. Perhaps the government thinks (with some justification) that its avowed intention to ignore international law will annoy all the right people. Perhaps it is part of a strategy to scare to EU into getting serious about dealing with ambiguities in the WA.
Brussels has been shown what the precipice looks like, and it is significant that the EU has not pulled out of the trade talks. What the UK Government can do now is to get on with the job for a few last weeks. Brussels needs to agree a simple trade agreement and to interpret the Protocol in ways tolerable to a sovereign nation while the UK can row back on putting this into law.
The signing of a trade deal with Japan this week, followed soon we hope by other deals, shows Britain settling into a new post-Brexit world. This will help the EU to see that the UK might well settle for no deal and for unilateral changes to the Protocol. Better for future harmony that all sides work quietly towards a sensible outcome.
On the website this week
The Treasury’s tax rise plans make no sense by Harry Western
Economist Harry Western argues that the UK is not ‘on the edge’: it would take a dramatic deterioration of key variables like growth and interest rates to put the UK at risk of some kind of financial crisis. Proposals to raise taxes now verge on lunacy.
“What are we to make of the Treasury’s attempt to bring in big tax rises? We can dispense quickly with the notion that their reasoning is based on sound economics”
Barnier’s fishy story on UK sovereignty, By Anna Bailey
Last week, Michel Barnier stated that while the UK would regain full sovereignty over its waters post-Brexit, the fish in those waters were ‘another story’. Unfortunately for Barnier, international law proves him completely wrong on this point.
“One can only surmise that Barnier’s remark was a theatrical but throwaway comment made in frustration at said international law not being on his side”
Distorted Irish economy means high payments to the EU, by Graham Gudgin
Ireland is the world’s largest tax haven, causing huge distortions to Irish national economic accounts. By greatly exaggerating the size of the Irish economy this leads to Ireland paying much larger contributions to the EU budget than is warranted by an economy of its size. Irish per capita contributions to the EU’s Coronavirus Recovery Fund are the highest of any member state other than fellow tax-haven Luxemburg. These payments may start to reverse Ireland’s love affair with the EU.
“The tide of [Irish] gratitude for EU largesse must now begin to flow the other way”
Key points this week
Criticism of the government’s Internal Market Bill has been loud and vocal this
week. Aside from feigned moral outrage over the supposed deception entailed by
protecting the integrity of the Union, several more serious potential objections have
been levelled at the bill. Firstly, that it might lead to the collapse of negotiations with
the EU over a future trade deal. Secondly, that it will lead to a Britain receiving a
reputation as a ‘Perfidious Albion’ and thus make future agreements with other
partners harder. Thirdly, it will jeopardise the Good Friday Agreement, threatening
local stability and alienating the powerful Irish lobby in the US.
As regards the talks, the EU has certainly threatened this prospect, but the fact is that
it is unlikely to abandon negotiations while it still wants a deal, and while it realises
that shutting down negotiations might simply precipitate the collapse of the rest of
the Withdrawal Agreement altogether. Even if talks do cease, as we’ve outlined
before an Australia-style relationship in the event of a WTO-Brexit is a perfectly
reasonable outcome. To the second, this furore hasn’t stopped the government from
signing its deal with Japan, or making good progress with joining the TPP. As our
allies realise, there is a world of difference between the average trade agreement
between sovereign nations covering the removal of tariffs and accreditation of
services, and a thrown-together treaty replete with ambiguities of interpretation
which encroaches on core areas of national sovereignty – what the Withdrawal
Agreement in its unmodified form represents.
To the third, the onus is on the EU to respond with border checks in the Republic of
Ireland if it feels that the UK’s measures aren’t protecting the single market. Indeed,
our obligations under the Good Friday Agreement are, as outlined by Ian Duncan
Smith in the FT, to preserve the status of Northern Ireland as open to the rest of the
UK as well as the Republic of Ireland. A clear majority of the province’s external
trade goes to the rest of the UK – and this needs to be protected if we are to meet our
Good Friday obligations. As we detailed in an earlier blog post, Britain needs to ‘box
clever’ rather than abandon the agreement entirely – and this legislation is part of
that process. When push comes to shove it will not be Britain that breaches Good
Friday by imposing a hard border. (There is also a certain irony that voices which
previously decried a trade deal with the US as undermining UK standards now aver
America’s unwillingness to do a deal as a reason to respect the WA.) Moreover, the
UK isn’t planning to abandon checks and notifications entirely. The Internal Market
Bill merely arrogates discretion to ministers over how far customs declarations and
state aid notices will be implemented, which doesn’t preclude the possibility of
coming to a productive understanding with the EU over these issues – without,
however, surrendering to Brussels the final say.
Key Points is compiled by a Cambridge PhD student.
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How you can help
There is much about Brexit still to be decided. Our MPs listen to their constituents. Do continue to send them links to our articles, especially on matters relevant to your constituency – for example, in rural areas, articles on the threat to British agriculture. Alternatively, make an appointment to speak to them at their next surgery. Let them know what you want post-Brexit Britain to look like.
As Boris Johnson said in in his post-election address, it is also time for unity and reconciliation. Keep reading our posts and share links to our quality content to help others understand how leaving the EU will be good for the UK economy and for our own democratic governance. We aim to educate our critics to think differently and more positively about the long-term impact of Brexit.
An Oxbridge PhD Student
Dr Graham Gudgin
Economist, Centre for Business Research, Judge Business School University of Cambridge
Professor Robert Tombs
Emeritus Professor of French History, University of Cambridge