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?

Brexit. What If No Longer “The Will of the People”?

What if it is no longer the “Will of the People” for the UK to Leave the EU?  What should happen then?

The referendum in June last year gave UK voters a simple choice.  Leave or Remain.  Leave won by a slender 52:48.

One argument is that the people had their say.  It is up to the Government to deliver Leave, in whatever form, come what may.

The other argument is that the result was only a ‘starting gun’ and developments should be kept under review.  If arrangements to leave are going well, and polls suggest public support, then fine.  That is still the “Will of the People”.  But what if one or more of these is happening?

• What if the vision of Brexit that was sold is not going to be achieved? 
• What if opinion polls are clearly against the type of Brexit that is on the cards?
• What if the economic impact is not £350m a week more for the NHS, but less?  

We are now in that position where all three look to be happening.  Surely then the Government, or at least the MPs in Parliament as our democratically elected representatives, should call a halt?

A new deal with the EU was going to be quick and easy.  Some said the UK would stay in the Single Market.  Certainly nobody was proposing to leave without a deal.  But after four rounds of negotiations have failed to produce any substantial agreement, and trade talks will not start until they do, a “no deal” is very much on the cards.

Whilst polls asking “Leave or Remain” have moved in favour of Remain, what’s more striking is people’s attitudes to a “no deal”.  The latest poll suggests a clear 5 to 3 against a “no deal”.

The Treasury suggests “no deal” would produce a significant hit to the nation’s coffers, perhaps £15 billion a year.  That’s less money available for the NHS.

It’s clear that “no deal” is no longer the “Will of the People”.  Nor is it in the national interest.

This is an urgent matter.  We’re already seeing banks and other businesses move operations and jobs abroad.  Businesses are having to close down due to Brexit weakening the pound and increasing  their costs.  That was stated as a key reason behind Monarch’s closure yesterday, compounded by a rescue deal being prevented by the uncertainties about Brexit.

MPs should make a stand as our democratically-elected representatives.  The sooner the better to stop such losses.  Here’s how.

How and When Will Anti-Brexit MPs Rebel?

Fifteen months ago Leave won the referendum by 52:48 over the UK remaining in the EU.  Debate still rages about the legitimacy of that referendum.  But most of the MPs who campaigned for Remain accepted the result, albeit still believing Brexit is not in the national interest.

As a result, six months ago MPs voted for the Article 50 notification to the EU that the UK wished to withdraw.

Now it is looking increasingly likely that there will be “no deal” and the UK will crash out of the EU as early as March 2019 and become a “third country” to the EU.   That would that mean extra paperwork and delays for importers and exporters across the Channel and Irish border, especially painful for the movement of foodstuffs and other perishables. The UK would also lose the EU’s trade deals with other countries, depending how quickly replacements can be put in place.  Chaos for years, and an inevitable seriously negative impact on the economy.

At what point will MPs grasp the seriousness of that prospect and say “stop”?  How will they do so?

WHERE WE ARE IN THE NEGOTIATIONS

There has now been four rounds of negotiations between the UK and EU since the A50 notification.  Three key issues have been on the table and none of them have been resolved.  Indeed the EU have stated that there has not been adequate progress on any of them to go onto the next stage of discussing a future trading relationship.  Time is running out and the two sides seem to be as far apart as ever.

The overall situation was suitably summarised by Michel Barnier, leading negotiations for the EU, in a speech he made in July.  Theresa May’s recent speech in Florence may have improved the tone of the negotiations, but that has not yet been enough.

Furthermore, fifteen months on from the referendum and the UK has still not put a credible proposal in place for how the future relationship would work.  A key issue is letting the UK control its borders instead of the Free Movement of People that the EU requires.   Can this be resolved to get a deal?  It’s looking unlikely.

WHAT DOES THE COUNTRY THINK? 

The indication from polls is that there might be a small shift so that Remain might just beat Leave if the referendum were to be re-run.  Certainly a preference for Remain compared to "No Deal". But more important is what’s behind this.  As Labour MP Angela reports from the doorsteps of her constituency that voted Leave “...there were voters who just wanted Brexit. They told me they didn’t care what it looked like or how many jobs it cost. But such attitudes were significantly outnumbered by those who made it clear they didn’t want Brexit to damage the country or their own living standards. One could feel, in fact, a sense of dismay in relation to the government’s handling of the Article 50 process so far.”  That concern is echoed right across the country by those who voted Leave or Remain, whatever the colour of their politics.

Professor Chris Grey has said "... just about everybody with any knowledge of what Brexit means, and just about everyone who has to take responsibility for dealing with it, is opposed to it. Whilst just about everybody who supports it does not have the responsibility for delivering it or the knowledge needed to do so." It’s a matter of dogma versus pragmatism.  Dogma is currently winning in government, but we must be more pragmatic in the national interest.


SO WHAT NEXT?

The UK government has just declined a second referendum, despite a petition of well over the 100,000 threshold for considering a debate.

It is up to MPs to lead the country on our behalf.  That is what they were democratically elected to do. The referendum result was a ‘starting gun', not a blank cheque to crash out of the EU.

Progress against the vision for which the people voted should be kept under review.  If the vision is not achievable, and a second referendum is not happening, shouldn’t MPs act accordingly?

How? There is already a cross-party MPs’ group called the “APPG on EU Relations”  that is campaigning for the best deal for Brexit, specifically to stop a “no deal”.  This is led by Chuka Umunna from Labour and Anna Soubry from Conservatives with parliamentarians from other parties.

The Labour Party has just held its conference, and ducked the issue of Brexit. Officially Labour still backs a vision of Brexit very similar to what the Government is pursuing.   But many Labour MPs are against that, and at the very least believe the UK should stay in the Single Market and Customs Union, even if that means continuing Free Movement of People.

A similar situation exists in the Conservative party.  As their conference starts, there is a ‘life boat’ option for MPs and others who do not support a “no deal” scenario and who would call themselves “compassionate Conservatives” nearer the centre of the left-right spectrum.  That is to form a new party in coalition with like-minded MPs and supporters in Labour:

The new party would be to the right of the LibDems which supports a rather socialist agenda, and would be unacceptable to most Conservatives.  It also would more closely match where ComRes found most voters placed themselves on the left-right spectrum:

It takes at least a couple of months to register and get approval for a new political party.  The Just Party is already registered and stands ready to be the ‘vehicle’ for the new group.

If you believe in this vision, do donate to the cause so we can better promote that vision. Up to £500 can be donated by anyone anywhere without your identity being made public..

In any case, do tell MPs who you think would be interested in making such a stand against Brexit in the national interest.

Brexit: Shouldn’t The Future Relationship Be Defined First?

Isn’t the EU putting the cart before the horse?  Surely we need to at least define the essence of the future relationship first?

That would define:

1. How trading will work
2. What affect that would have on people and their freedoms, both Brits in EU27 and EU27 citizens in Britain
3. Impact on Irish border
4. Any ongoing financial contributions the UK would make

The EU are trying to cover points 2-4 without covering point 1, the future relationship on trading.

Yet Article 50(2) of the Lisbon Treaty specifically says "...setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union...".  This acknowledges that withdrawal arrangements can only be made if at least the “framework” of the future relationship has been defined.

Businesses and governments, both sides of the English Channel, also need clarity on how trading is supposed to work:

• To make strategic business decisions, such as where to site offices and factories
• To design systems and processes, and then build them

Theresa May has asked for an implementation period of around two-years after the withdrawal agreement has been made and confirmed by all concerned.  That is the minimum needed to put new systems and processes in place.

Any Brexiter demanding that the UK leaves immediately or more quickly than Theresa has proposed is asking for chaos.  Not only for cross-border trade and passport control, but the UK also needs to set up various bodies which are currently covered by Brussels.

But most importantly business needs a good idea of how Brexit will work as soon as possible.

The EU must allow the future relationship to be discussed as soon as possible, so the “framework” is agreed and understood quickly.

Florence. In Which Theresa Tries To Slay The Unicorn

Today Theresa May spoke about the UK Government's vision for Brexit. A little later the EU's chief negotiator Michel Barnier issued a statement in response.  Has she slayed the 'unicorn' of the UK wishing for he impossible, having its cake and eating it? Let's look at each statement in turn.

THERESA'S SPEECH

I listened to Theresa May talking, live.  Her tone of voice as much as the actual words. First what was good:

1. The overall tone was to work with the EU's negotiators for common benefit.  Gone were the strident, aggressive tones of Government representatives that have hindered the talks so far.
2. Negotiations work best when the other side's position is understood. She specifically acknowledged that freedom of movement of people (FOM) is a fundamental requirement of the single market, and that the same trading benefits cannot be expected without the same obligations.  The new relationship outside the EU requires a new balance.
3. She displayed a new pragmatism, especially the need for a transition period to give businesses and governments both sides of the channel time to implement the agreed post-Brexit arrangements.  Around two years was suggested.  

Two years is tight if major border and trading changes are required, and assumes sufficient detail of the new relationship is known by March 2019. Technically under article 50(2) of the Lisbon Treaty, only the withdrawal agreement and future framework would need to be finalised by then, with further detail on the future relationship potentially taking years to negotiate.  The devil's in the detail in such matters.

She also made a few specific points, especially on the three key negotiation issues that have stalled:

(1) There should be no hard border in Ireland, and nothing else to undermine the Good Friday agreement.

(2) EU27 nationals currently in UK are welcome and valued under current terms.  "Italian Continental Stores" happens to be in the heart of her constituency.

(3) Money will be available to plug any hole in EU finances, presumably during the transition period but no longer.

So far so good.  The unicorn wounded, but not slain.  

But she also said that UK must be able to control its borders.  That's what she believes was meant by the Leave vote.  For some voters it was, but for others it was more about striking further distance from the EU's intent on becoming the United States of Europe.   Fact is though, as Home Secretary she could not properly control immigration.  Being able to do so is a key factor behind her conversion from Remain campaigner to leading Brexit.

So to achieve no FOM she asks for a "creative" trading arrangement.  One that recognises the depth of the existing trading relationship, and so not like Norway nor Canada. Something new.

But she made no proposal for how that trading arrangement might look, or at least not one she is prepared to outline in public.  A vision with no clear means of achievement after all these months.  

Sadly the unicorn stands proud!

BARNIER's RESPONSE

Firstly he acknowledged Theresa's "constructive spirit which is also the spirit of the EU". He will entertain the idea of a transition period, but on EU's' terms.

Unsurprisingly he wants some "concrete" proposals on the various items.  After all it is the UK requesting to leave whilst somehow retaining a partnership.

The key issue is his brief from the EU27 to not discuss the future relationship before the existing issues such as the Irish border have been resolved.  But this is fundamentally wrong for two reasons

(1) Article 50(2) of Lisbon Treaty specifically says "...setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union..."

(2) Because the framework for the future relationship can provide the key to major withdrawal issues, such as the Irish border and monies

IN CONCLUSION

The unicorn still stands proud. The UK is still after on ongoing relationship that doesn't look achievable.

There are two key issues, one on each side, that make negotiations difficult:

(1) EU's insistence on deferring talk of ongoing arrangements when these could help resolve the withdrawal issues

(2) UK's insistence on controlling borders, without any proposal for a workable trading relationship. Probably because there isn't one that doesn't cross the EU's red lines that Theresa acknowledged today.

The EU must agree to talking about the ongoing relationship soon.   Logically the ongoing relationship should be in place before the withdrawal agreement, as article 50(2) implies.   Indeed the steps should be:

1. Framework for future relationship (with detail to follow)
2. Any transition arrangement
3. Any remaining withdrawal issues

The EU is putting the cart before the horse, and that must change. 

But that still leaves the UK's FOM issue of border control.

It's like border control is the tail wagging the UK dog.  The conundrum is that Leave won because of that topic, but with it there is no clear solution to future trading and the Irish border.

Nevertheless, border control does not justify holding the negotiations to ransom:

1. 

   Net immigration has been consistently below non-EU migration which is fully controlled.  Employers that need workers will get dispensation anyway. Border control of EU27 nationals is therefore somewhat of a red herring.
   2. Reciprocation will mean Brits will no longer have the freedoms to live, work, travel and retire to EU countries, nor to move between them.  That is a big loss.

I can see no settlement without border control being dropped.  If explained properly in the terms above, the majority of Brits should support it.  But that would make a mockery of the need for Brexit, and leave many people still disappointed.

How about simply walking away with no deal?  Whilst the UK government still says they would do it, everyone knows they can't.  The economic consequences would be too bad, with a massive hit to public finances.  Governments don't do that.  That's why Theresa effectively pleaded with the EU27 to work together to avoid that possibility.

That then leaves only two pragmatic options:

1. Proceed with a "soft Brexit" in which trading continues similarly to currently, with all four FOMs.
2. Brexit is cancelled, and UK continues with MEPs

Personally I'd support either, but would be interested in a soft Brexit if well constructed. Some ideas here.

In the meantime the UK is still chasing that unicorn of an ongoing trading arranegement similar to today's but with border control.

Project Fear versus Project Unicorn. What Now?

Inflation up since Brexit vote

Last year we had a referendum between 'Project Fear' for Remain and 'Project Unicorn' for Leave.  Lies, half-truths and general forecasts on both sides.  The result reflected what enough people believed and hoped, both in their head and their heart.

Fifteen months on we have 'Project Reality' that's showing a very different picture.  Forecasts on both sides haven't turned out to be correct, Do we need a new vote to confirm that people want to continue with Brexit, or otherwise stop it?

• Negotiations with the EU are not going quickly and easily as Leave supporters suggested. The UK does not hold all the cards. In particular the German car industry has again just confirmed that keeping the EU27 together is more important than their UK export market.  That means no special treatment for the UK.
• Sterling has devalued 15-20% against major currencies in which the UK's imports of food, clothes and other products are purchased.  The result is general inflation now running at 2.9%, but food in the shops showing 10%-15% increase or more on many imported products.
• Some investment into the UK.  But an increasing list of companies like Chubb and many in financial services planning to move their operations to continental Europe or Eire.  That's jobs lost.
• Concern about collaborations like EURATOM and Open Skies that are non-political, and don't need the UK to have MEPs
• Jobless figures improving but average earnings dropping. Coupled with rising inflation, that's squeezing the disposable income of most households in Britain.  That spells trouble.  Strikes in prisons and binmen in Birmingham may just be the start.

Most of these issues can be reversed by remaining in the EU, or at least remaining in the Single Market and Customs Union for economic purposes.
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So what do the people of Britain think now?  The referendum last year should be respected but was marginal and only a 'starting gun'.  What about those people in Labour heartlands who voted Leave in the hope of economic improvement, but are seeing their personal financial position getting worse?

It is clear we need another vote before proceeding any further with Brexit, by next Spring 2018 latest.  Voting on the final deal in 2019 is too late.  Businesses will have already pressed contingency plan buttons, and there will be no time for businesses and government departments to change their systems and processes.

So how to achieve a new vote?  It needs political change.  Every government aims for growth in the economy and more jobs.  This government is risking both. The best forecasters are expecting an economic hit.  Less tax receipts, more squeeze on the NHS and other public services.

So here's an invitation to MPs on all sides who understand the risks the UK is taking to join forces to take a more pragmatic approach to the UK's future in the various pan-European initiatives.

Anti-Brexit. March and Protest. There Needs To Be Political Change Too

Photo by Christopher Dale

Yesterday was the PeoplesMarch4EU.  Well over 10 thousand people marched through central London from Hyde Park to Parliament Square.  Not just those who are pro-EU adorned in EU flags, but many others who are anti-Brexit.  Another demonstration is planned for the Conservative Party conference in Manchester in October.

Great.  They highlight the depth of feeling to remain in the EU.  But when was the last time a march changed government policy?

A far more fundamental change is needed in Parliament.  MPs from all parties who believe the country is headed for an economic disaster if we leave the Single Market and Customs Union (SM/CU) need to unite behind a new banner.  That may mean a #Half Brexit, or a complete #HaltBrexit.

The vote on the EU (Withdrawal) Bill tomorrow, Monday, is their first chance as the Bill makes its way through the Commons and the Lords. 

Many of these MPs within Labour were supporters of New Labour and are not Corbynistas.  Likewise there are Compassionate Conservatives who do not like their party’s swing to the right. 

After all, the vast majority of voters regard themselves in the centre, as the two lines below show (upper line all electorate, lower line voters, per ComRes poll late 2014).  As we heard this morning on Marr “the centre ground of British politics needs to rediscover its traction”.

Why not the LibDems?  There are very few Conservative MPs and supporters who would move to the LibDems.  The party’s background is from the left, and Sir Vince Cable’s recent leadership has underlined the party’s socialist credentials.  That is too far to the left as shown above.


A new party is required properly in the centre that would attract MPs and supporters from both the Labour and Conservative parties.  That would achieve a size and influence the LibDems have not achieved, nor will ever achieve.


The only centrist anti-Brexit party already registered with the Electoral Commission is The Just Party, shown above in cyan (light blue).  We can contest an election even if called as early as tomorrow. We therefore extend an invitation to everyone who shares our vision to join us.  Further details are here.

There's probably over a hundred MPs whose heart would back The Just Party's views on Brexit and politics generally, who just need a catalyst to come together.  Maybe the EU (Withdrawal) Bill is that catalyst.

If you were thinking of funding the demonstration in Manchester, then by all means do so. But if you really want change, then do help fund The Just Party and spread the word as well.  Here’s our GoFundMe site.

Let’s do it!