EU Referendum


EU Referendum: an important contribution to the ongoing debate?


14/07/2015



000a chargeorgo-014 pub.jpg

After a number of "teasers" in the Telegraph, Matthew Elliott's Business for Britain have at last published their complete book called "Change or go", purporting to tell us "how Britain would gain influence and prosper outside an unreformed EU".

This publication, by any measure, is a major event in the eurosceptic movement, as it wants to be "an important contribution to the ongoing debate about Britain's future relationship with the European Union", both during the Mr Cameron's renegotiations and during the forthcoming referendum campaign.

As such, it would be perverse if I did not review it on this blog. And anyone who knows of my views of Mr Elliott and his work might expect to find an amount of criticism. But then, any body of work extending to over 1,000 pages is bound to open up multiple opportunities for criticism.

However, there are some who would prefer that, in the interests of unifying the anti-EU movement, I didn't criticise Mr Elliott or his work in public. Any such criticisms, it is held, should be made in private where differences should be resolved.

It has to be said, though, that Elliott was invited by David Phipps to join in multi-party talks, which I attended. It was he who refused to have anything to do with them, preferring instead to tell us that he was going to lead the "no" campaign.

Elliott could also have sent me a pre-publication review copy, and invited comments - which I would have given him, if asked. But he chose not to ask. Now he has published the work and it is in the public domain, where debate is invited. So debate there shall be.

That said, there is a lot of information in this book, some of it good. And, for those who understand enough to separate the wheat from the chaff, there is some useful information. Unfortunately, there are many errors, some highly flawed and dubious assumptions, and a tinge of unwholesome hubris which drastically reduces the value of this first edition.

Unlike Flexcit, from which this work clearly borrows, the authors could not resist the temptation of dismissing everyone else's work on how to leave the EU, coming up with their own unique "plan" and grandly declaring it, and it alone, to be "optimal".

The point, of course, is that no plan is "optimal" – not a single one. Every one involves compromise, and all have their disadvantages – some more than others. The only way to address this problem is to treat withdrawal not as an event, but an ongoing process, with sufficient flexibility to surmount obstacles and to deal with changes in circumstances as they arise.

Despite this, BfB would have us believe that their so-called "British option" is indeed optimal, its final form taking us into the promised land of an "EU-UK free trade agreement".

Recognising that such an agreement might take longer than the two years initially allotted for Article 50 negotiations (although not telling us how much longer), the authors come up with the bizarre suggestion that negotiators could start discussions "off the books" without formally triggering Article 50 immediately.

By this means, "much of the new bilateral agreement could potentially be worked on and even drafted by committee before formally invoking Article 50", the authors say. And after such talks, "the transition from membership of the EU to a new free trade arrangement could take place overnight, but that Article 50 might only be invoked formally the day before".

Sadly, though, this ingenious fiction simply cannot happen. Outside the framework of Article 50, only the Commission is empowered under the treaties to carry out trade negotiations. But these can only be conducted with third countries or international organisations, and then only in accordance with Article 218 TFEU, through which the Commission must obtain a mandate from the Council.

Clearly, the Commission cannot be given a mandate to negotiate with a member state, and outside the framework of Article 50, there is no provision for the Council to conduct negotiations with a member state on trade issues.

Since, as a treaty organisation, the EU is obliged to work within the framework of the treaties, it is thus not possible for the institutions to conduct "off the book" negotiations. The suggestion of invoking an "overnight Article 50" is palpably absurd.

Take away this, though, and the BfB's wondrously "optimal" British option falls apart, leaving them in the same messy territory that we all have to occupy, with no real understanding that their worst-case scenario of a "WTO-only" option would be catastrophic.

Only dimly do they recognise the role of non-tariff barriers, and the need for conformity assessment, whence (on page 937), they blithely tell us that the UK could work [with the EU] on an Agreement on Conformity Assessment and Acceptance of Industrial Products (ACAA) "so that trade in given areas is treated as between EU member states".

This, we are told, "confirms, first, that a state departing from the EU could expect few NTB compliance barriers", an assertion which is true only in the event of the agreement actually being concluded. Yet, according to this Commission Working Document, four conditions have to be fulfilled.

Firstly, there has to be demonstrated that there is adequate infrastructure in the fields of standardisation, accreditation, conformity assessment and metrology in the partner country. Then the relevant part of the acquis has to be adopted – which in practice means committing to the whole Single Market acquis. Penultimately, there must be in place regulatory co-operation and technical assistance and then, finally, the whole thing must be stitched together by a formal agreement.

The latter condition of a "formal agreement" amounts to a separate treaty – or even multiple treaties which might include a Mutual Recognition Agreement on conformity assessment. These could take some time to agree. The point though is that a formal agreement is required. The ACAA does not and cannot happen automatically. And without it, the NTBs would be formidable.

It is the case though, that all the elements are in place as long as the UK is an EU Member State. However, a departing state would doubtless have to discuss and agree mechanisms by which continued conformity would be assured, which would have to include provision for market surveillance, mechanisms for agreeing and adopting new provisions, and dispute/non-compliance provisions. In the normal scheme of things, these tend to be at the complex end of the negotiation cycle.

Dealing with NTBs, therefore, is not quite a simple as BfB makes out. Their explanation of what we need to do verges on the simplistic and overly optimistic, with serious hurdles to surmount before trading could resume on existing terms.

However, if BfB were to treat this document as the opening statement in an ongoing debate, and were genuinely prepared to entertain discussion on difficult and contentious issues, then it would have some value. With more work and an amount of editing, it could be knocked into shape and become something useful.

If, on the other hand, it is to be treated as "tablets of stone", with not a word to be changed, then its many flaws will render it unsuitable for general circulation. In any event, few will read its 1,000-plus pages, but without substantial correction and improvement, it has little value even as a reference work.

BfB can assert its own superiority, in which case it will stand alone in grand isolation, or it can join in with the rest of us in working together to find answers to problems of common concern. Taking a leaf from his own book, therefore, it is up to Mr Elliott to decide on whether he wants to change or go.

And then we have a referendum campaign to fight.