EU Referendum


Brexit: steering the safest course


09/10/2016




"It needed the skills of an old-time Kremlinologist to decipher the various enigmatic, very carefully worded clues Theresa May gave us last week as to her thinking on Brexit". So writes Booker in his column today and, of course, he's right. There is an art to reading politicians' speeches, where context is vital and what is not said can be as important as the words actually delivered. 

Important speeches actually start off as written words, which are then debated, revised, re-written, tested, checked, and re-written many times. Thus to get the sense of them, you need to avoid the delivery. The words must be read, without the distraction of the theatrics.

But the context also matters. In this case, as Booker observes, Mrs May needed to throw a bone to her more rabid followers, so she promised a "Great Repeal" of the European Communities Act.

Needless to say, this was not to take effect until the negotiations had been completed, and a settlement agreed, so what was being offered was nothing new. This was simply a necessary procedural step, to make the formal break from the EU and set us on the path to independence.

Sensibly, Mrs May also committed to keeping much of the law we have been subjected to over the past 43 years in place, transforming it into UK law, while we gradually work through which bits of it can sensibly be replaced.

From the outset, that was always going to be a necessary step. EU law (or law with an EU label) governs so much of our lives that to repeal it immediately would leave dangerous gaps, preventing the proper functioning of the state. In this instance, it is better to have even bad law, than no law at all.

In reality though, a huge amount of that law stems from international bodies and is going to remain in force, come what may. And for much of the rest, the need to maintain what is known as "regulatory convergence" will require that we not only keep much of the EU acquis, but add to it as new EU laws come into being.

Effectively, therefore, Mrs May was doing nothing more than highlighting some of the expected procedural steps which go towards Brexit. But in the context, with all the razzmatazz of a Conference speech, the faithful – and the unthinking media – has to make something special of it.

As to the most sensitive of the subject, Mrs May very carefully avoided saying that we would once again "control our borders". Others used that phrase. But Mrs May didn't – even though most media sources insisted that she did.

What she actually said was that we would take steps to "control immigration", an altogether different thing. Not least, she is well aware that much of our immigration is determined by other international treaties that are not linked to our membership of the EU.

Then, taking account of what she didn't say, it is possible to take from the precise construction of Mrs May's words, the possibility that she will allow free movement of workers from EU Member State, while at the same time bringing down the overall numbers of immigrants coming to this country.

That the media – and so many of the pundits – chose to interpret Mrs May's carefully guarded phrasing as a commitment to abandon free movement is their affair. But try as you might, you will find no words uttered by Mrs May to that effect.

Then, she was equally careful in her reference to the UK becoming "an independent, sovereign country" to emphasise that everything we do must nevertheless remain "subject to international agreements and treaties with other countries".

This is almost Jesuitical in its ambiguity, allowing for a qualified sovereignty that isn't really sovereignty at all – not in the sense that the purists would want it.

Most interesting of all, however, were the clues Mrs May gave to her thinking on the crucial issue of our trade with the EU. Without openly giving away her negotiating stance, she was more careful than ever to insist that our Brexit agreement must continue "to involve free trade in goods and services" with the EU.

In terms of words, she ruled out the "Norway model" and the "Switzerland model", but that does not gainsay the inescapable logic that, if Britain wants to continue enjoying "free trade in goods and services" with the EU, this can only mean that, on leaving, we must in some way remain part of the wider European Economic Area (EEA), subject to Single Market rules.

Nothing Mrs May said, or didn't say, necessarily ruled out the UK opting for participation in the EEA. It doesn't have to be the "Norway model". After all, the thing about the EEA Agreement is its almost unique flexibility. The end result could so easily be styled the "British solution", with protocols and annexes tailored specifically to UK needs.

The outcome, though, is a matter is a matter of logic. Anything else would be far too complicated to negotiate in the time available. Anything short of the EEA – such as naively hoping to rely just on "WTO rules" – would result in precisely the disruption and chaos of which so many business interests, from the City of London to the owners of our largely foreign-owned motor industry, have been so firmly warning.

Unsurprisingly, therefore, we saw the CBI's Carolyn Fairbairn yesterday writing an open letter calling for the Government to deliver barrier free access to the Single Market.

She writes that leaving the EU without a preferential trade arrangement and defaulting to WTO rules "would have significant costs for British exporters and importers, as well as those in their supply chains". Every credible study that has been conducted, she says, has shown that this WTO option would do serious and lasting damage to the UK economy and those of our trading partners.

The letter is co-signed by Terry Scuoler of the EEF, Chris Southworth of the ICC and Julian David of techUK. They ask that the Government gives certainty to business by immediately ruling this option out under any circumstances.

Then, entirely supporting Booker, and reinforcing the point made so forcibly made in Flexcit, they say that there is a wealth of evidence to suggest EU negotiations will not be completed within the Article 50 two-year timeframe. Thus, they ask Government to secure agreement on a "transitional period".

Miraculously, according to the Economist, that involves an interim trade deal "through temporary membership of the European Economic Area".

Continuing as members of the EEA, writes Booker, would not only give us the kind of access to the single market that would dissuade Nissan and Jaguar Land Rover from moving their operations abroad, and those "passporting" rights for financial services which City firms are so fearful of losing. It would even give us some limited right to that "control over immigration" from the EU that Mrs May promises.

In other words, Booker concludes, if we have read the runes aright, the Prime Minister is steering the only course which could minimise our problems on getting extricated from what she described as the "supranational government" we have increasingly been ruled by for four decades.

At least last week she gave us some clue that she has begun to realise just what a complicated process this will be – but that she is determined to find the most sensible way to do it.