We must stop trying to appease the EU and prepare for no deal

We must stop trying to appease the EU and prepare for no deal

It is becoming very clear that the EU doesn’t want a “deep and special partnership” with Britain. Their negotiators are more and more insulting, they reject our discussion papers as “unsatisfactory”, and they insist that Britain must be worse off after Brexit. Our City envoy found only intransigence and a lack of interest in solutions.

Is this just a negotiating tactic? I don’t think so. Ideally both sides should see themselves as gaining from a negotiation. The EU rules this out for Britain. You don’t get a deal that way. They don’t want us to agree. They want us to submit. They still seem to think that if they apply enough pressure, we will back down and somehow stay part of their system, still under their control, and still paying. In the meantime the longer we talk, the longer we continue paying.

Our current approach encourages this delusion. We talk of a “deep and special partnership”. What we really want is a Free Trade Agreement (FTA). We talk about a transition period that includes elements of the single market or customs union. Why should they agree to a watered-down version? That’s why they insist on ECJ jurisdiction over everything that moves. Anything else is unthinkable for them.

We must stop trying to appease the EU, and prepare for no deal.

Yanis Varoufakis warned us not to delude ourselves that EU leaders want a Brexit agreement that works well for both sides. He should know. Brussels and the key member states, Germany and France, insist that Britain must be seen to lose. A successful Brexit would endanger the EU. They openly admit that others might follow. Germany cares much more about the EU than the British market. Germany also has a vested interest in the British financial settlement, because if we don’t pay, they are next in line. They will not be riding in to save the talks.

Mr Barnier doesn’t have a mandate to negotiate. He has a list of concessions, all of which Britain must make before he will talk about trade. They alone will decide when sufficient progress has been made to proceed to trade talks. The clock is ticking, they say, but only for Britain.

We want a Free Trade Agreement, but we don’t need it.

An FTA is the only big element of Brexit that needs agreement. We can do the others ourselves – leaving the single market, the customs union, ECJ jurisdiction and the free movement of people. We don’t need permission or agreement.

The EU doesn’t seem to have grasped this. As an independent country, it is up to us to make our own arrangements for immigration, farming and fisheries. Yet when a draft paper on immigration policy was leaked, the EU screamed foul, because it gave no preference to EU citizens. This will poison the well, they cried.

An FTA does need their agreement. We don’t need an FTA, because we can trade under WTO rules, as we do with the rest of the world. But it would be good for both sides. We should make a simple and clear offer of a no-tariff FTA – do you want it or not? The answer is likely to be no. Britain must suffer for leaving, even if EU businesses and workers must suffer too. They know that an FTA negotiation takes time, even from a starting point of identical regulations and no tariffs. If they really wanted an FTA, they would not be deliberately cutting into that time by refusing to talk.

Once they refuse, we’ll know where we stand and can prepare. An FTA will have to wait till they come to their senses. That will simplify the negotiations.

Defence and security arrangements will continue because it is in nobody’s interests to stop them. The mass of detail in related agreements will be sorted out. Planes will continue to fly and medicines to be licensed. The civil servants on both sides are now finally engaged on sorting out these important matters separately, and producing detailed papers, which is what they do. They have an aversion to chaos, and nobody’s interests or prestige is riding on obstruction in these areas. Politicians obstruct things that are important to politicians.

We don’t need to tie everything up into a deep and special partnership. It is counter-productive to do so. The only risk to sorting out these matters would be for the politicians to tie them into something big and special, which will become a political football. We introduced the phrase “deep and special partnership”. We should forget it.

Neither will the EU compromise on a transition period.

Theresa May’s Florence speech gave away far too much. She asked for a transition period of about two years, involving “no change in our trading relationship with the EU”. We will effectively be third-class members of the EU, still paying the bills and following EU rules, but with no say at all. We’ll still be subject to the ECJ and free movement of people. We’ll be unable to make our own free trade deals for two more years. The EU has no incentive whatsoever to offer us anything special for the transition period. At the great moment when we leave the EU in March 2019, what will change? As Boris said in another context, two-thirds of diddly-squat.

The EU will drive a hard bargain before they agree to any transition period. They will demand a large proportion of their €100bn “exit fee”. Submitting to their demands as the deadline approaches would cause political turmoil in Britain, and who knows who would come out on top? Probably Mr Corbyn, and what would he do? It would give the EU its best chance of bringing us eventually back under their control.

We should aim for nothing more than a short, administrative implementation phase after we have formally left, to give a limited number of systems and procedures some extra months to settle down where necessary. For example, the imposition of mutual tariffs might be postponed for six months. If systems aren’t ready, and faced with potential chaos on both sides of the border, it would be foolish not to find a way.

Asking for anything longer or more formal would put us at the mercy of the EU. Avoiding a lot of fruitless haggling on trade will leave more time and resources to make other things work.

We have complicated matters with our talk of special partnerships. Anyone who insists on our being seen to suffer from Brexit is not a special partner. We should recognise that, accept it and get over it. We cannot appease them.

We offer a free trade deal, but if they don’t want it, WTO will be fine. We will happily continue to co-operate on anything that does not put us under the EU’s control in any way. As a sovereign nation, we are developing a whole range of new policies. They are none of the EU’s business.

And the €100bn? Well, let’s talk about that. Why was it again that you wanted it?