Labour MPs must accept the possibility of No Deal as the only way to get a better deal

Labour MPs must accept the possibility of No Deal as the only way to get a better deal

As the end of October 2019 looms closer, a viable way of resolving the current Brexit impasse does not get any easier to see. The problem can be simply stated. The current Withdrawal Agreement is not acceptable to Parliament but there is little incentive for the EU to agree to changes to it. As long as Parliament is determined not to accept No Deal, even as a last resort, the EU holds all the negotiating cards – and there seems to be no way ahead. We are stuck with parliamentary arithmetic which does not stack up.

The EU wants to force the UK Parliament to accept the Withdrawal Agreement as it stands, particularly as regards the Irish backstop and the payment of £39 billion. If the UK is not prepared to walk away from this bad deal, the danger is that the EU’s tactics may succeed. Parliament may, in the end, agree to the Withdrawal Agreement or something very like it, leaving the UK in a disastrously weak negotiating position as we move into the planned transitional period, with many difficult issues still to be resolved.

There is, however, a possible way out of this bind. Suppose Parliament was prepared to accept No Deal – not as its preferred outcome, but as a lever to get the EU back to the negotiating table. The UK would need to be prepared to go through with this threat but the objective would not be to allow No Deal to happen. Instead, it would be to use a threat of it materialising to get the EU to modify its stance sufficiently to get an acceptable deal through Parliament.

The EU has a big incentive to do this. No Deal is not an ideal outcome for anyone, but the EU would suffer from it more than us because EU27 has a huge export surplus – almost £100 billion a year – with the UK. If the UK is prepared to risk No Deal, the sensible thing for the EU to do would be to stop this happening by agreeing to sufficient changes to get an agreement acceptable to both the EU and the UK in place. 

But for this to happen, the EU would have to believe that – if it came to the crunch – Parliament would vote for No Deal rather than the Withdrawal Agreement. This is why Labour Leave has produced a document called, It Makes No Sense To Throw Away Your Strongest Card, with the strapline “No Deal should be kept in play – not because this is what we should be aiming for but because we need to be able to walk away from a bad deal to secure a good one”.

This document contains an updated assessment as to how difficult No Deal would be. At a time when it looked as though aircraft might not be able to fly, the ports were going to choke up with lorries waiting to get cleared and food and medicines might run short, understandably many people regarded No Deal as completely unacceptable. But preparations have gone a long way during the last few months and the prospects with No Deal, although not ideal, now look much less alarming than they did a few months ago.

Essentially what has happened is that No Deal has morphed into being a whole raft of mini-deals negotiated to cope with all the most pressing issues, to enable planes to fly, lorries to keep moving and life to continue more or less as normal. Of course, there would still be some disruption, and some people would suffer – and might need to be compensated if possible – but overall the position looks much more manageable now than it did before.

So what Labour Leave’s document does is to ask MPs, especially Labour MPs, to assess again just how problematic No Deal would now be. Would the much lower risks now involved in being prepared to go through with No Deal be worth taking – with the aim not of finishing with this outcome but using the threat to do so to secure a better Comprehensive Agreement with which the EU and the UK can all live?

We think they are. We ask you to read our report and to make your own judgement. As the strapline to our report says, we need to be able to walk away from a bad deal to secure a good one.