Richard North, 22/11/2017  
 

000a undergrowth-022 Brexit.jpg

Having been in London at a private conference, delivered under Chatham House rules, I am in something of a dilemma. If I tell you where I was, I can't tell you anything of the proceedings. It follows, therefore, if I tell you anything of the proceedings, I can't tell you where I was. If I did, I'd have to kill you.

Suffice it to say, therefore, that I was on a panel chaired by a BBC Today person, with a former civil servant of some fame - one, who has been regarded with some approval by this blog and whose views on Brexit very much accord with my own.

My presence on the panel, together with a garden implement who used to be president of an organisation that might have something to do with industry, was highly fortuitous for this anonymous ex-civil servant. He found to his satisfaction that, just for once, he was not the most pessimistic person in the room in his analysis of our prospects for Brexit.

The differences, however, were only marginal. We both agreed that there was not a great deal of cause for optimism, especially as industry seems to be afflicted by a pervasive sense of complacency.

Separately and independently, we had both found that senior ranks within a wide range of business enterprises were almost completely unaware of the extent of the crisis that was about to descend upon them, while presentiments of gloom tended to be dismissed, purely on the basis that the consequences of a failed Brexit were so serious that they could not be allowed to happen.

Quite who is going to step in and prevent the disaster is never actually specified and nor are the mechanisms which will be deployed, which puts the confidence in the realms of a belief system that transgresses mere knowledge and experience. It really is as shallow in its roots as it appears: the disaster cannot be allowed to happen because, if it did, it would be a … er … a disaster.

But the other area of almost total accord was in our estimation of politicians in the driving seat, right to the highest level. The two factors which had the most influence on them was, on the one hand, a most extraordinary level of ignorance and, on the other, an almost complete inability to listen. If anything, the stories that have leaked out on these aspects are somewhat under-stated.

That ignorance, though, was not entirely confined to the politicians. In a smaller meeting after the main event, in an impressively modern room with a panoramic view of the Thames that people probably have died for, the conversation drifted into a discussion on the nature of free trade agreements.

It was at this point that I asked for a show of hands of those who had ever downloaded a copy of an EU agreement and read it – even if it was only a skim-read. Apart from my host, not a single hand went up.

Intriguingly, the ensuing silence was broken by the observation from my anonymous civil servant that most ministers similarly lacked ambition in their choice of reading material. These trade agreements were, in a very real sense, a closed book.

The point here, of course, is that it is very easy to be enthusiastic about the utility of free trade agreements if one hasn't actually looked at any of them. But when you read through the detail, one begins to understand quite how limited they are as instruments of trade.

And very much in our collective consciousness was Monday's speech in Brussels by Michel Barnier. In particular, his comments about "access" to the Single Market" struck a chord: you can have "access" but this is different from being part of the Single Market. And how different, people are beginning to find out.

No sooner, for instance, do I write a lengthy piece on the problems facing civil aviation manufacturing than we see in the Guardian a report on Airbus and its evidence to the business select committee.

At least the term "non-tariff barriers" is beginning to get some currency, although there the dead hand of incomprehension is still playing its part. Having finally come to terms with the idea that there is more to international trade than tariffs, we see everything else being translated into "customs delays".

This lack of comprehension on the part of the media came up, but it was also noted that information was not getting through to the higher levels in the corporate environments. The people who really did understand the issues – and there are some – are further down the food chain.

This was evidence in the Airbus submission which has the company's senior corporate representative in the UK, Katherine Bennett, warning about the threat of new customs bureaucracy, which "could deter long-term investment and accelerate a shift to Asia". Yet, for Airbus in particular and the aviation manufacturing sector in particular, customs issues are the least of their problems.

This I actually managed to point out, drawing attention to the plight of the food industry. It's not customs delays that will affect exports but the rather more serious problem of their losing export approval. This followed comments about the NFU and its inability to see where the peril lies, another example of the failure to come to terms with the UK's change of status from EU Member State to "third country".

Here, there is that continued tendency to focus on the effects of leaving without a deal, as here, where the head of the ADS aerospace trade body warns MPs that if the UK was to leave the EU without a deal, it would be "chaotic" for the industry. They simply do not get the point that many of our problems arise from leaving the Single Market, and will cause damage with or without a deal.

Nevertheless, not unhelpful yesterday was another Guardian piece which had Leigh Pomlett, executive director of CEVA logistics group, declaring that it was "bordering on insanity" to think new Brexit customs systems will be in place for 2019.

"It is just the urgency of this that worries me. It takes me longer to negotiate a supply chain contract than we have here. Arguably, it is already too late", says Pomlett. For sure, this is still keeping the focus on customs and the prospect of delays at the borders. But what makes this intervention different is the language used.

Too often, industry representatives are overly-guarded in their statements, their excessive caution (or diffidence) diluting their messages to such an extent that they lose any impact. In this instance, we have someone telling it like it is – even if we were writing about it in March.

There are times when I have to sit back and review my own position, wondering if I'm losing my own sanity – not least when we read this (Guardian yet again), where we see the headline: "UK confident Irish border will not stop progress of Brexit talks", retailing the view that "Downing Street still believes the Irish border problem can be resolved by December", despite Dublin's veto threat.

With Mrs May supposedly doubling what she is prepared to pay for the "Divorce Bill", this has senior UK officials, who "remain confident that Northern Ireland will not prove an insurmountable sticking point at the next EU council in December".

Here, it is not just the quality of the media and the politicians which is in doubt. The "Rolls-Royce" civil service is actually closer in performance to a second-hand Trabant. Many of the old skills have been lost and the Whitehall structure is creaking.

Needless to say, we predicted this problem in Flexcit (see pages 174-177). And yesterday, in front of an audience of hundreds of the most senior financial business representatives in the country, I heard this described as the "only credible leaver plan".

If there is room for optimism, it is that all the options have not yet been exhausted. Waiting in the wings (possibly) is a battle over the government's refusal to give notice under Article 127 to leave the EEA. This may (just) be the battle that keeps us in the Single Market, despite the best attempts of the "ultras" to wreck our economy.

All the same, there is nothing yet which can suggest that we are winning the battle. But I do sense movement in the undergrowth. The "ultras" may be making a lot of noise and the government's stupidity may be dominating the headlines, but there are quiet voices making themselves heard.

(pic: Shutterstock)






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