28 November 2018

Whatever its flaws, May’s deal is Britain’s best bet


Incredibly, Brexit consensus has been achieved. Brexiteers and Remainers finally have a shared objective: to deliver the most withering put-down of Theresa May’s withdrawal package.

Jeremy Corbyn called the Political Declaration “26 pages of waffle”, while Remain media campaigner Ian Dunt described the suggested course as a “conveyor belt towards an abattoir”. Ambrose Evans-Pritchard at the Telegraph argued the deal would give the UK “non-sovereign status as a legally-captured adjunct to the EU.”

More importantly, such sentiments are also apparently rife throughout the House of Commons, including on the Tory benches. But given the character of the withdrawal process so far and the UK’s volatile situation, this reaction is misguided. Regardless of the deal’s flaws, MPs wishing to act in the national interest should back the package, especially as it promises an innovative partnership with the EU.

As has been gleefully documented, the UK has been steamrollered during the Article 50 process. EU negotiators applied their leverage to extract initial concessions and then used overwhelming power and expertise to drive home the advantage.

A quick, clean, critical opening victory on sequencing led to an unrelenting focus on Ireland. That produced the Joint Report, which was developed into the contentious draft Protocol. The Irish backstop then dominated the rest of the negotiations, preventing the future partnership coming to the fore. That onslaught of legal and diplomatic might was met largely with bluster, naiveté and ignorance by the UK government and Brexiteers.

Consequently, despite a late EU adjustment to permit a UK-wide customs union in the backstop, a stormy Irish cloud hangs over the Withdrawal Agreement and future partnership declaration. For Brexiteers, and those who think that the vote to leave the EU must be implemented, this has been frustrating and chastening. But the understandable emotion should be suppressed. Sober analysis is required to salvage the best possible outcome from the admitted humiliation.

First, while the EU has backed the UK into a corner, Brexit is still perfectly achievable. And the alternatives to the negotiated deal are almost certainly considerable disruption or departure being cancelled.

If there is a drift to disorderly exit, the EU will further toughen its stance — after ensuring it gets its money, the Irish border remains invisible, and its citizens’ rights are protected. This probably means the crippled UK exports and snarled-up supply chains we have heard so much about. Yes, this would also cost EU nations, but their pain would be trumped by the higher purpose of ensuring that the UK endures the consequences of its actions.

There is also the much-discussed alternative of no Brexit. Analysts may say this is unlikely, but the one thing that seems certain is that rejection of May’s deal agreed with the EU would mean the political pieces being thrown up in the air. For those committed to leaving, is risking no Brexit really a better option than May’s Brexit? Well, that depends on the deal.

Although it did not satisfy the DUP, the government obtained a significant concession when the EU acceded to the all-UK customs union, crossing its redline that backstop arrangements must not merge with the new relationship. Although there is no assurance that a permanent EU-UK customs union will result, Kenneth Armstrong, a University of Cambridge professor of European law, thinks that the backstop “may turn out not to be a safety net, but a trampoline” into future arrangements.

At this point it must be acknowledged that few Leavers ever imagined that the UK would end up remaining bound to EU tariffs. Furthermore, the Prime Minister should admit that the UK can hardly be said to be taking back control of its laws. Instead, after the transition, the UK looks as if it is going to be in a customs union and obliged to follow a raft of Single Market rules.

Such hybrid solutions infuriate hardliners. For the more pragmatic, given the serious predicament the country has got itself into, they should suffice. Building on the Political Declaration would at least mean continuity rather than chaos. Doubtless there would be a hit as supply chains that rely on frictionless trade are disrupted and red tape for commerce and travel increases, but it will be manageable.

Maverick former ECJ judge Franklin Dehousse has questioned the wisdom of Michel Barnier’s strategy, describing the focus on the backstop at the expense of other trading issues as “evidently biased” and criticizing the “new doctrine” of the four freedoms’ indivisibility. “The focus on the Withdrawal Agreement has made the EU lose from sight the potential benefits of a new relationship,” he wrote.

However, after recent developments, it looks as if the EU may have started to interpret its principles more flexibly, safe in the knowledge that the UK will remain in its orbit and withdrawal will have set a harrowing precedent. And the key point is that, if the UK does accept a customs union, it looks as if the EU may also permit arrangements that allow for the relatively free movement of goods.

That is what Armstrong believes is occurring, with the Political Declaration indicating the EU is seeking an overarching framework that could be applied to relations with, for example, Switzerland. “The EU looks to be experimenting with a category of relationship that isn’t membership, that isn’t the EEA experiment, really does build on a free trade model and has a relatively high degree of cooperation, but nonetheless creates some flexibility within it,” he said.

Even with these developments in Brussels’ thinking, the emerging domestic question will be what is the point of this halfway house? UK gains from negotiating its own trade deals to boost services exports, or devising its own farming policy, will arguably be outweighed by other factors. It will have to shadow the common tariffs, EU regulations could constrain what agricultural products are allowed, and it will have to maintain EU standards on competition, environmental and labour policy.

Many on both sides of the argument will say this is pointless, which would mean that the UK’s European question remains unsettled. The opposing sides could then regroup and launch concerted election campaigns to either break out of the EU’s domain or re-enter. Whether that would be as a full member of the project and eurozone, or maybe simply as an economically integrated participant, would be discovered in due course.

MPs committed to Brexit who are still mulling over their options should also consider that Armstrong’s interpretations are not the only conceivable ones. Understandably, there has been interest in the Political Declaration’s reference to customs cooperation and technology-driven systems as a potential backstop alternative.

An important part of the EU strategy has been to deride suggestions that the Irish border status quo could be maintained if the UK exits the Customs Union and Single Market, a line dutifully repeated in the media. And indeed, it has apparently been accepted by the Prime Minister herself. However, Parliament’s Northern Ireland Affairs Committee recently heard from experts again claiming that the border could remain invisible.

“There is no need for a backstop. You can organise this system within the transition period, and it is all working fine. It is there. It is all in the Union Customs Code,” said Dutch customs broker Hans Maessen, a Brexit adviser at SGS Government and Institutions Services.

Maybe the government will finally prove a match for the EU and successfully argue that case, if necessary by referring it to the independent arbitration panel. Regardless, whether the UK asserts itself or simply steadies itself post-Brexit, either option is comfortably better than rejecting the withdrawal package.

William Davison is a former Bloomberg correspondent and freelance journalist.