The latest speculation about a ‘no deal’ Brexit fails even to properly define the scenario

The latest speculation about a ‘no deal’ Brexit fails even to properly define the scenario

In the total absence of a Brexit deal, bad things will happen. This is to scrunchify the findings of a new report from the academic grouping, UK in a Changing Europe (UKCE).

It is now absolutely inevitable that assorted flappers, doom-mongers, and fans of retro Third Republic-style politics will now seize upon this report as proof that the British Government is on the student equivalent of a steep incline perched in a shopping trolley. Some will do so without reading it, which would be a particular shame as the report itself qualifies its findings.

However, in this instance I rather fear that UKCE, if they have not quite jumped the shark, have bicycled over a ferocious halibut. They have done so by themselves pointing to, but without fully addressing, the full significance of the terms in play. The central problem lies in definitions.

Usefully, they identify four different interpretations of what “no deal” is, to add to the two alternative prospects of a transitional deal and a straight step deal. The scenario they pick, unhelpfully to us but perhaps dictated by the nature of the collaboration, is the least defined of them all.

Core to the analysis is the recognition that “answering these questions requires a significant amount of speculation.” The paper continues: “We do not claim to provide precise answers; nor do we attempt to be comprehensive.” That leaves the writers reduced to offering “informed speculation” – and it is informed speculation, let us not forget, on what is acknowledged as the worst-case scenario.

Therein lies a further problem, because analysts covering Brexit are in fact dealing with risk assessment. In this case and others like it, the mistake is the failure to use what is known as the Uncertainty Yardstick.

The Uncertainty Yardstick is, quite simply, a mechanism for clarity in language. It ascribes a percentage likelihood to a specific piece of vocabulary. What is “improbable” to one person may have a different meaning than to another. So the Yardstick assigns a percentage to a set of expressions. If you say improbable, or unlikely, you actually mean that you assess that there is a 15-20% chance of something happening (my assessment is that the reader would “probably” – 55-70% chance – have thought it was set for that word at a different rate…).

Now that analysis may still contain an element of caveated arbitrariness, depending on the amount of data available, but there comes with it a clarity of interpretation and assessment. Unfortunately, that is lacking in this report. That makes it an unwitting tool for EU-irredentist scare-mongerers (whose number includes former Prime Ministers).

So what about those percentiles? There are two key fundamentals in play during Brexit negotiations. The first is that the work being done across Whitehall, because of the nature of government and of diplomacy, will be hidden. Because it is out of sight, radio silence is encouraging nihilists to suppose that civil servants and ministers, preposterously, are merely moving deck chairs. Whatever may actually be going askew inside Brexit negotiations, this is not one of them.

The second point takes us back to the language. While this report may be a small step forward in this regard in recognising divergent interpretations, the vocabulary around Brexit remains looser than Benny Hill’s trouser belt. Indeed, to make fun of it over in The Red Cell we even generated a Random Brexit Generator.

When we talk about “No Deal Brexit” we really do need to be clear about what we mean. Sometimes it is used in the sense of an absolute default on absolutely everything, as implied in this report; it is equally what would happen if the Department for Exiting the EU went on strike, got hit by a space bolide, or just walked away from the negotiations.

Alternatively, and with (relatively) much greater chance of it happening, with “No Deal” we are talking about a default to WTO Most Favoured Nation Terms, plus a series of bolt-ons on areas where agreement has been reached to facilitate trade and bilateralism in specific areas. “No Deal” here means failing to get the one big deal, but still ending up with lots of little ones that collectively cover technical elements normal people don’t know about or normally get interested in.

That would result in an arrangement short of a single, deep and comprehensive free trade deal (such as the Ukraine or Georgia have with the EU), anchored on a single core document and which facilitates market access by developing “better-matched regulations”. Though if that symmetry already exists, because the UK system is today fully compliant and perfectly-matched, the target then is not necessarily about getting everything in a compound text; it is about continuing that correlation, at least for a transitional period while an FTA is sorted out. That could still be achieved through reaching a phalanx of technical ‘side’ agreements that cover those potential barriers and obstacles, addressing issues such as IT connectivity and legal cover.

Some call that a “Deal” option. Some call that a “No Deal” option. Looking back the ‘bad news’ scenarios identified in the UKCE report, in three of the four of them, the circumstances still allow for a swarm of sectoral Memorandums of Understanding, Agreements and mini-treaties to happen. As a “no deal” goes, having a set of arrangements that cover, say, 90% of the potential problems through a multitude of de-accession sectoral bilaterals is a very different bag from having one that covers none of them. That’s then just the business of normal diplomacy.

That is not to say that there are not lots of problem areas, including technical issues, that need to be addressed. Nor is it to say that there are big areas to negotiate where particular talks might stall, of which the relatively simplest and most over-reported is over the money owed (in terms of spending cycles, “RAL” commitments, pensions liabilities, and share of assets coming back). It is simply to ask commentators now looking at this UKCE analysis to apply some common sense and context rather than go all Last days of Pompeii on us about our prospects.

If civil servants and ministers didn’t know there were technical, financial and administrative issues with just walking away from the EU, the 1972 accession act would have been repealed by the Government last year. It didn’t. They do. Move on.