What If “No Deal” Had Been In The Brexit Referendum Question?

Today's Sunday Telegraph front page

This coming week is the next round of negotiations between the UK and EU over Brexit.  There has yet to be any agreement on the three key negotiation topics so far.  The European Parliament has just voted that there has not been “sufficient progress” in the talks to move on to discussing the future relationship, including any trade deal.

A “major breakthrough” is needed this coming week.  The chances of that are slim, so media talk has moved to there being “No Deal”.  What if that had been the Leave option in last year’s referendum?

What if the two referendum questions had been:
1.    Leave the European Union with no deal
2.    Remain in the European Union?

Certainly all the Leave talk before the referendum was of a deal with the EU.  The possibility of “no deal” was barely discussed.

We could have debated what “no deal” would mean.  This includes:

• No trading agreements with any other country, until they are put in place, as discussed below
• No arrangements for Brits to travel to, work or retire in any of the EU27 countries.  Uncertainty for any Brits already in EU27.
• No arrangements for EU27 citizens in the UK, which is already causing massive uncertainty for people in the NHS and across the economy from baristas to senior professionals.
• Suspension of collaborations for science, aviation, security and many other key areas
• Need to create agencies to cover administration topics currently shared with the EU27.  Costly and could take years to put in place to operate properly
• No acceptable solution to the land border in Ireland, whoch is one of the top three issues in the initial negotiations

On trading, the thought has been that the UK would ‘simply’ fall back on WTO (World Trade Organisation) rules.  But these are highly complex where amongst other things the EU28 quotas on each product would need to be split between the UK and EU27.  The first foray into this area has just been rejected by the USA and New Zealand amongst others, with whom there has been hope for full-scale trade deals.  Not a good start.  Without WTO agreement there is simply no agreement, and agreement could take years to cover all the different products.  Agreement will also need to be made for trade with the EU!

The Port of Dover has highlighted that the delay in processing each goods lorry would mean “Operation Stack” would become the norm.  Many products are either perishable or part of a “just-in-time” supply chain. Delay would create major problems, and probably make many trades unviable.

Solving the delay problem requires major investment in infrastructure and IT systems.  But not just at UK ports.  Continental European and Irish ports too. Who is going to pay for that?  When if at all?

In the meantime the economic impact could be enormous. Importers and exporters could in many cases have to cease trading, with impact onto all their local suppliers and customers.  Difficult to assess, but those in the know suggest “no deal” would be economic suicide.

That view may or not be exaggerated. But if that’s a possibility, certainly “no deal” is not an option to be taken lightly.  Yet it was not discussed with any prominence before the referendum.

The referendum was 52:48 where the assumption was that there would be a deal.  If the question was “Leave with no deal” it is difficult to imagine that result.  Maybe no better than 30:70, with a clear win for Remain.

WHAT DOES THIS MEAN?

Firstly the referendum does not give the UK Government a clear mandate to leave without a deal.

Secondly there needs to be a second referendum as soon as it is clear that “no deal” is likely.
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The question is how to achieve this politically?