There is no “soft Brexit”: it does not exist as a serious or credible option

There is no “soft Brexit”: it does not exist as a serious or credible option

“Unforced error – a missed shot or lost point (as in tennis) that is entirely a result of the player’s own blunder and not because of the opponent’s skill or effort” – Merriam-Webster Dictionary

Just under two months ago, the UK looked as if it was on a strong and stable path to a good exit from the European Union. This would restore our legal and constitutional independence, and also restore independence in economic choices over our domestic economy and our trade with the fast growing and ever more important markets in the rest of the world. The Act of Parliament authorising Article 50 notification was passed in the end with large majorities in both the Commons and the recalcitrant Lords. Article 50 notification was given to the European Council, triggering our automatic exit from the EU on 29th March 2019.

It was foreseeable that there would be bumps in the road, both in negotiations over exit terms and future relations with the EU, and with the complex legislation necessary to implement Brexit. It was foreseeable that there could be difficulties in the Commons and the Lords, but with a nominal overall majority of 12, and the ability to supplement that if called upon with the aid of other allies from Northern Ireland and some Brexit supporters on the Opposition benches, these were difficulties that could and should have been weathered.

On 18th April, the Prime Minister reversed her previously much-repeated position that there was no need for a General Election until 2020, and announced a snap election for 8th June. She gave as her reason that it was “necessary to secure the strong and stable leadership in the national interest” in order that the Government’s plans for Brexit could be carried through with the support of a greater majority in the House of Commons.

The General Election results speak for themselves. A General Election has been held for which there was no need, and it has resulted in the elimination of the Government’s previous overall majority. What may yet prevent this calamitous and entirely self-inflicted disaster from turning into a catastrophe is the prospect of the pro-Brexit Democratic Unionist Party entering into a support arrangement with a Conservative minority government. On a wing and a prayer, this could be just enough to enable the government to keep going through to Brexit day on 29th March 2019 and to get the necessary legislation through Parliament.

It is a matter between the Conservative Party and its leader to assess the competence with which the Conservative election campaign was conducted and indeed whether it is now possible for her to continue in office as Prime Minister. As a non-party/cross-party group, Lawyers for Britain does not express opinions on these subjects. However, we do have strong opinions on the merits of the Brexit-related issues which featured, or rather did not feature, during the campaign.

Although Brexit was supposedly central to the election campaign, it is quite remarkable how little the Conservative campaign, or speeches by the Prime Minister or other Ministers, featured the actual merits of the Government’s Brexit policies as compared with the Brexit policies of the opposition parties. The focus was almost entirely on the personal qualities of the Prime Minister versus Jeremy Corbyn to conduct negotiations with the EU.

As we pointed out in our own pre-election analysis of the manifestos, there are differences between the kinds of post-Brexit arrangements favoured by the Government and those favoured by the opposition parties.

Admittedly the differences between customs unions, internal markets and external trade agreements are highly technical matters to explain to the general public. But the British public are a great deal more intelligent than some politicians give them credit for. The Government reached the decision not to seek to remain in either the EU customs union or the internal market before the Prime Minister’s Lancaster House speech in January 2017, but little attempt was made to explain to the media or the public the reasons for this decision. It is a crying shame that no serious attempt was made to explain and expose the massive consequences for this country if it were to stay inside the customs union or the single market, either before or during the General Election campaign.

It is a crying a shame because the vacuum has allowed a total myth to be propagated. That myth is that it would be economically better for the UK to stay inside the customs union and/or the single market, and that it is only pointless ideology or an obsession with curbing immigration at all costs which accounts for the Government’s rejection of these options. In addition, an ill-thought out notion is gaining ground that post-Brexit membership of the customs union and/or single market in some way represents a “soft” Brexit which is a concession to the wishes of those who voted Remain, as compared with a supposedly damaging “hard” Brexit.

It is a crying shame because none of these arguments withstands a moment’s serious scrutiny and analysis. Post-exit membership of the EU internal market and of the customs union would put us in a limbo-land where we would be rule-takers, bound by huge restrictions on our economic and political freedom of action according to rules on which we would no longer have a vote, and which could be altered seriously to our disadvantage in future.

Since we would no longer have a vote on the internal market rules on financial services, we would be powerless to prevent them being changed even further to the disadvantage of our financial services industry in the City and in other major centres such as Edinburgh in furtherance of a misguided protectionist attempt to bolster Eurozone financial services. And we would be totally prevented from undertaking supply-side reforms of the regulatory burdens imposed on our domestic economy and international trade by the EU internal market rules. We would be required to submit to our laws to being automatically overturned by rulings of the EFTA court which simply shadows the ECJ,

Customs union membership would oblige us to continue to charge high tariffs on types of goods where we have no UK industry to protect, for the sole advantage of producers in EU states. British consumers would pay the cost of the tariffs through higher prices, but we would have to continue to hand over to Brussels 75% of the tariffs borne by our consumers. Even more catastrophically, customs union membership would totally prevent us from entering into trade agreements with non-EU countries who now represent over 55% (and growing) of our export markets.

On the other side of the ledger, the supposed economic advantages of customs union and internal market membership are grossly oversold. Tariff-free trade between the UK and the EU can continue after Brexit under a free trade agreement which preserves our ability to decide on our own levels of external tariffs and to reach trade agreements with non-EU countries. Modern “friction-free” and “virtual border” customs arrangements can ease the flow of goods at the Channel ports and avoid the need for physical customs posts on the Northern Ireland land border. And mutual recognition of standards based on a starting point where we are in line with the EU internal market rules can ease the flow of goods and services between us and the EU after Brexit.

The idea that single market membership would somehow be easier to negotiate than a free trade agreement is another total myth. If the UK wanted to belong to the single market after EU exit, we would need to apply to join the European Economic Area Agreement as a non-EC member. In order to join the EEA we would need the consent of 30 states (the EU members plus Norway, Iceland and Liechtenstein), all of whom would need to ratify the necessary treaty changes in accordance with their respective national constitutional requirements. This is actually a bigger barrier than what is need to secure agreement to a free trade agreement with the EU.

The reality is that there is no “soft Brexit”. It does not exist as a serious or credible option. Half-way house arrangements in which we are subject to EU rules but have no say in setting them are the worst of all worlds, which would continue to subject us to all the disadvantages of EU membership but not give us the freedom and opportunities of leaving the EU in shaping our laws, controlling our borders and taking advantage of global trading opportunities. The only softness is in the heads of the people who advocate such half-baked and ill-thought out notions.

When fully examined, the overwhelming economic and constitutional drawbacks of the limbo-lands of post-Brexit customs union and internal market membership are glaringly apparent. In these fluid times when the Prime Minister’s electoral miscalculation and failure to explain her Brexit policies has once more thrown open the door to these notions, it is vital that the real consequences of these choices should be fully understood, in order to prevent this needless election disaster turning into a catastrophe for our country.

Photocredit: Chatham House