Brexit: complications multiply as time runs out

17/11/2016

The pair was housing minister Gavin Barwell and shadow minister without portfolio Andrew Gwynne. Both were questioned about the UK remaining in the EU's customs union and both managed to parade their ignorance in a fashion to which we have long become accustomed.

Gwynne, in particular, made a special fool of himself, asserting that Switzerland was in the customs union. This is a man clearly at sea, unable to tell the difference between a free trade agreement and a customs union, telling us that the customs union was "an important part of the operation of the single market".

Once upon a time, I suppose, we elected politicians to Westminster, but now we get political oxygen thieves, people who don't even know the basics – yet these are the people who would claim to have a better standing when it comes to judging the Government's Brexit plans, when Mrs May finally deigns to let us know what they are.

Nevertheless, despite my low opinion of British politicians being amply confirmed, my long-term views about the intellectual supremacy of continental politicians is also under challenge (not that I was terribly wedded to the idea).

The proximate cause is a similar confusion over the customs union idea, this displayed by Dutch Labour politician Jeroen Dijsselbloem, currently holding down the posts of finance minister for his country and Eurogroup president.

He was reacting to Foreign Secretary Johnson who has been in the Czech Republic where he revealed to a Czech newspaper that the UK would "probably" leave the customs union.

As usual, the media steps in with its own brand of ignorance – in this case the Guardian - confusing a customs union with customs cooperation and telling us that this move "is likely to alarm businesses that move goods to and from the EU as it would mean extra checks at the border".

Disinformation sprayed out by the media, though, is an occupational hazard and we have to get past that in order to confront Mr Dijsselbloem who argues that Johnson is promising the British people a Brexit deal that is "intellectually impossible" and "politically unavailable".

According to Dijsselbloem, it is "impossible" to be inside the internal market but be outside the customs union. That option, he says, just doesn't exist. On the other hand, he says, the opposite does exist. We have a customs union with Turkey but Turkey is not part of the internal market.

These gems were delivered to James O'Brien from BBC Newsnight who, showing typical form for the programme, was unable to recognise that he was being fed a diet of tosh. It was left to Andrew Neil the next day to point out that Norway is in the Single Market but not in the customs union.

Partially rehabilitating himself, though, Dijsselbloem moved on to speak at an event in London which was reported by Reuters. There, he told his audience that negotiations over Britain's departure from the EU are "very complex and are going to take longer than the scheduled two years".

In Mr Dijsselbloem's playbook, we have the British government's stance toward Brexit starting to show signs of splintering and "Europe" eager to pull together and prevent a populist backlash that could fracture the EU further. And in this scenario, he says, talks are likely to be strained and drawn out.

This, of course, is nothing new to the readers of EUReferendum.com but, when a politician gets something right, I suppose they should be applauded, even if he trails in our wake by more than two years.

Nevertheless, it was worth noting Dijsselbloem's observation that many in Europe were also unprepared for Britain's vote in June. "People make jokes about the UK not having a Brexit plan", he said, "but many Europeans didn't have a plan either".

And there lies a further hurdle to plans for a speedy exit. It is not only UK politicians who have to come up to speed, but their continental counterparts. Even if our Government gets its act together, it may well have to wait for others to catch up.

That said, it looks as if there is a suggestion of compromise from Angela Merkel on freedom of movement, once again confirming our assertion that the issue always was (and is) negotiable.

However, Die Welt is taking a less optimistic view than some British newspapers. If the British are exempted from the principle of freedom of movement and therefore the right of EU citizens to work in all Member States, "other countries within the EU will try to follow", the paper has Merkel say. "This would weaken a pillar of the EU".

From this, we are being schooled to expect that the British cannot hope for a "special position", although the German Chancellor does say that the EU should be talking about how this freedom of movement should be modified in the future.

It is not only the British who are criticizing the short period before immigrants from other EU countries are able to claim benefits, so Merkel is saying that we need to discuss the qualifying periods for rights resulting from freedom of movement.

Despite this, it is early days yet, and the parties have still to focus on the safeguard measures built into the EEA Agreement. But given the general lack of knowledge we are finding amongst politicians (and, of course, the media), it is going to take some time before we see any sense talked about this.

What is emerging, though, is a wider recognition that we are not going to be able to walk away from the EU without paying a hefty bill.

The Times is running a story headed: "£60bn divorce demand could wreck May's hopes of a deal", conveying the not altogether surprising news that Theresa May will be unable to enter Brexit talks because the EU "will set impossible demands, including the condition that Britain agrees to pay £60 billion to Brussels".

According to several officials and diplomats, the European Commission is drawing up a schedule of Britain's financial liabilities until 2020 and beyond, suggesting that the UK will have to pay between £50-£60 billion over three years from the end of next year until Britain's exit.

This, apparently, includes a UK contribution to the RAL commitment, which almost certainly means that the time period is incorrect. RAL does not become payable until the next MFF period, starting in 2021, and becomes due over the seven year period, so the phasing of payments will probably be extended through until 2027.

But news this isn't, having been dealt with in detail in Monograph 3. The conditions are hardly "draconian", as The Times suggests, and a commitment of about £60 billion over the next ten years or so is about right. Despite Vote Leave's stupidity, there never was a case where we were going to leave the EU without the Government putting its hands in our pockets.

With the well poisoned by Vote Leave's inept propaganda, though, the payments issue is undoubtedly going to be a difficult one for Mrs May to present. But sooner or later, she is going to have to break it to the electorate that there are going to be precious few savings from leaving the EU, for at least a decade, if not longer.

Given the sensitivity of the issue, one can surmise that haggling over the precise sums to be paid will absorb a significant proportion of the time available to us under Article 50, especially as The Times is indicating that Mrs May will be asked to meet all of Britain's financial commitments and liabilities as a precondition for Brexit negotiations even taking place.

How this will work out, we have no means of telling. But the EU is expecting will be aiming to have a Brexit package on the table by autumn 2018 and we are hearing from Brussels that the deal is expected to take the form of several agreements: a divorce agreement, including liabilities and issues such as policing and defence, accompanied by transitional agreements providing a bridge, lasting a maximum of three years, to a future framework.

If exit talks are completed in two years, Britain's future trading relationship must then be settled in the transitional period, during which time – one assumes – the status quo will prevail.

Yet there can be little dispute that, as the complexities involved in Brexit multiply, the idea of completing talks within two years is looking more and more uncertain. Even a transitional agreement does not solve the problem as this, in the form of a secession treaty, will require approval and ratification by all current 28 Member States.

Small wonder, PMQs yesterday got a little heated, with Corbyn challenging the Prime Minister over her lack of a published plan. Mrs May's tribal response was not encouraging, giving the impression that she is living off borrowed time.

If ever there was a political "honeymoon", that is rapidly coming to an end. Mrs May says she can deliver. Very soon, she will need to give some substance to her claim.