Richard North, 25/05/2017  
 


Predictably – and entirely as predicted – the UK media have largely given up on Brexit. No doubt, what passes for normal service will be resumed in due course, along with what's left of an uninspiring general election campaign.

Of the English-language press, that leaves the Irish carrying the torch, with RTÉ News flying the flag for its favourite son Michael O'Leary, Ryanair chief executive.

O'Leary was holding forth on the British prospects for Brexit, asserting that the "political imperative in Europe" is that the British will "suffer on the way out the door". He believes there will be a hard border with Northern Ireland and no free movement of people. The common travel area will also come under severe strain.

His view was that "you cannot have Britain be seen to leave the EU and not suffer". British people, he said, are deluding themselves because they are only talking to themselves and reading UK newspapers with a constant diet of "utter rubbish" about how they will negotiate a great deal for Britain.

As one might expect, he is concerned for the future of his business, worried that the UK is taking itself out of the "Open Skies" arrangements with the EU – the thrust of my piece in January. But O'Leary is racking up the pain, telling us that, after March 2019, there could be a period where there are no flights to the UK. People here might have to go back to "using the boats", he stated.

This may be an exaggeration but the way Mrs May is playing it - alongside David Davis – talking up the "no deal" scenario, is one sure way of making it happen. Unless there is a formal EU-UK agreement to replace the internal EU arrangements that currently apply, things are going get sticky.

As it stands, we have no information on how matters can progress, even if options are limited: the UK can either agree a stand-alone bilateral access agreement, or it can seek a wider-ranging free trade agreement with an aviation component.

But there other serious issues to resolve. Here, I'm reminded of a piece I wrote in July 2014 about the EU's external aviation policy, through which the EU has taken over the responsibility on behalf of all Member States for concluding agreements with third countries. Thus, when the UK leaves the EU, all the other external agreements fall. That includes those with the United States and all other countries in the world.

What is particularly disturbing, though, is that we have no idea of what the UK government has in mind when it comes to replacing these deals. It is not even clear whether we can conclude new deals until we have left the EU.

With such an important industry, where any disruption will have a huge impact on the travelling public and the economy, we should not be guessing. By now, there should be a clear outline of policy and a degree of certainty. Instead, we get reports such as this which records what amounts to a political vacuum.

This leads Andrew Swaffield, chief executive of Monarch, the holiday charter airline, to observe that we could end up with higher air fares, less choice and possibly even a return to 1970s air charter days. "Fares will gradually go up and there will be less competition", he says.

But if O'Leary has it right, these are the least of our worries. The potential for catastrophic disruption is not academic. For sure, we all expect the new government, most probably led by Mrs May, to deal with this issue. But we have had absolutely nothing bankable – in fact, nothing at all – which would suggest that the situation is under control.

Nor is this made easier by developments in EU policy. At the end of 2015, it published its Aviation Strategy for Europe outlining plans that extend to 2019, which include significant revisions to existing legislation.

On top of this, the Commission in 2016 was authorised by the Council to open negotiations in order to conclude bilateral air safety agreements with third countries (China and Japan) and EU-level aviation agreements with the Association of Southeast Asian Nations, Turkey, Qatar, the United Arab Emirates and Armenia.

For the EU, therefore, aviation policy is very much work in progress. Brexit can only be an unwelcome complication, requiring it to open up complex negotiations with the UK. On the other hand, the UK must open negotiations with the rest of the world to make its own access agreements.

Here, it gets even more complicated. The current EU policy stems from a 2002 ECJ ruling that bilateral aviation agreements of Member States with third countries were in breach of fundamental provisions of the EU Treaties. The intervening fifteen years have led to the current policy matrix, with a network of international agreements, of which the UK is part.

Such agreements are based on reciprocity, with the EU able to leverage UK access in brokering terms with third countries. Without the UK's weight, the EU may have to renegotiate some if not all of its third country deals. In other words, the entire international aviation settlement is at risk of unravelling.

Oddly, that gives us some leverage of our own. There is no gain for either the EU or the UK in disrupting current arrangements. So, as long as the UK is prepared to re-adopt relevant EU regulation – and commit to taking on board the revisions and additions as they arrive – and as long as the EU is prepared (and able) to revise its own internal arrangements, then the status quo will prevail.

This will require the EU to amend its own law to allow UK, as a third country, to operate "community airlines", allowing them to benefit from the third country agreements already in place. But that means, we will remain bound to the EU and have no more autonomy on aviation policy, post-Brexit, than we do now.

Then we also have to factor in Air Traffic Management and the Single European Sky, about which next to nothing has been written. Yet this 18-year-old programme must be revisited in detail.

For there to be continuity of commercial aviation services (freight as well as passenger traffic), all these complications will have to be addressed and resolved within the space of less than two years, allowing time within that period for the EU to produce and bring into force amendments to legislation which normally take many years to prepare.

Recently, Michel Barnier in his speech to the Irish Parliament warned that air connections between the UK and EU could be "severely hampered" if Brexit goes wrong. That might be something of an understatement.

Bluntly, even with the best will in the world, with all parties focusing on the problems and devoting all the necessary resources to resolving them, getting the arrangements in place for Brexit would be a considerable stretch. Yet all the indications are that the issue is not even formally on the agenda.

Quite often, I am accused of undue pessimism on Brexit, but I can only call it as I see it. Clearly, there are complicated issues to resolve, and when the chief executive of a major airline starts talking of international flights shutting down, we really need to listen.

Some of this may be hyperbole but no one can accuse the international trade body, IATA, of such a sin. The day after the referendum, it noted warnings that, given the complexity and scope of the negotiations, the 24 months allocated "would likely be insufficient time to complete all the necessary processes".

Months into the negotiation period, the threat of massive disruption is intensifying. And when aviation doesn't even appear to be on anyone's agenda, it is time to get very worried.






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