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08 Sep 2016

Relationship with the EU

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Let’s run through how much of a mess Brexit is in right now.

The lack of legitimacy

The underlying legitimacy of the referendum remains contested. There is a lack of a clear relationship between the vote and the rest of the political system: parliamentary approval(s), the hierarchy of dominance between the people and parliament and general sense that we’re making it up as we go along.

The lack of process

Linked to this, there is no clear process on the UK side. We don’t really know how we get to Article 50 notification, how to oversee Article 50 negotiations or those for the subsequent new relationship or those for new third-state agreements. This lack of UK planning is matched by a lack of EU planning too. For all the constant refrain about getting into the Article 50 process, there is no clear process at the moment.

The lack of positions

The lack of process on both sides is compounded by the lack of positions. The UK government evidently doesn’t know what it wants to achieve, beyond leaving the EU.

This in turn drives delay in notification. Theresa May knows enough to see that once inside Article 50, the UK gets very little say on things, so it makes complete sense to pursue as much as possible pre-notification. However, it’s exactly for that reason that the EU27 want to get to notification as soon as possible.

While the UK indecision is much discussed, it’s also important to recognise that the EU27 themselves don’t agree on what to do. The recent meeting of Merkel, Hollande and Renzi produced nothing more than some warm words about Altiero Spinelli, while the coming Bratislava summit is unlikely to advance matters

The lack of options

The paucity of positions reflects a paucity of options. Leaving the EU is so big and complex that nothing can be produced in short order because everyone thinks it’s someone else’ problem. Perhaps the British government doesn’t want to make its lack of plans obvious.

Lack of capacity

The new Department for Exiting the EU remains in a process of creation, with under half its intended complement of staff and an uncertain relationship with the Foreign Office and the International Trade Department.

The government

Theresa May might be the firm and reassuring hand that many in the party were looking for, but she was a Remainer (however half-heartedly). She heads up a government with a small majority and enough visceral eurosceptics to make life difficult-to-impossible for her.

The sceptic core will matter throughout the coming years. They will pressure May to notify the EU on Article 50, with the clear sanction that they will turf her out and seek to find a more compliant replacement. Secondly, they’ll be constantly pushing for the most UK-friendly deal possible within Article 50, which will make any of the inevitable compromises needed to bridge differences very hard. Here the sanction is the ‘hard Brexit’ option: refusing any deal and leaving after the two-year period is up.

This sounds possible: it preserves British integrity and will make others see that it’s very much their loss. However, the WTO option isn’t as simple or quick as it seems: WTO membership is linked to EU membership for the UK, so there would have to be renegotiation of tariff-schedules under WTO unanimity rules (i.e. including the EU27).

Finally the sceptic core might seek to secure parliamentary approval for any final deal, again seeking more concessions from a government that will struggle to gain them. Some sceptics could call for another referendum, to kill an agreement and head to ‘hard Brexit’.

The people

The Leave campaign succeeded in part because it built a very broad church: the ‘take control’ slogan was open to many interpretations, especially because no fixed plan for Brexit was presented or defended. That made sense to win the referendum, but now the cost becomes clear.

As the last two months have shown, there are many models of Brexit. Almost by definition, whatever deal might be reached, it will not be what those who voted Leave wanted. There is a clear risk that the wider forces of disaffection will see the outcome of Brexit as further betrayal by the ‘system’

To pull all of this together, someone’s nose is going to be put out of joint by Brexit, and probably quite soon. What will matter is whose nose it is and what they decide to do about it.

All of this is before we get to the specific issues that present no good solutions

First and foremost is the Northern Irish border. There is a basic and fundamental incompatibility between the UK’s territorial integrity, EU freedom of movement and the Good Friday peace arrangements. Whether you fancy a hard border, soft border, no border between Northern Ireland and Ireland, Northern Ireland and Britain, the British Isles and the EU: all present obvious and (seemingly) intractable problems.

Second, there’s a broader problem of territorial reorganisation, with the resurgence of the Scottish independence debate. While the lack of clear shift in polling in favour of independence will hold back the SNP for now, the party is well-placed to press its advantage, especially if Article 50 goes badly.

Third, there’s the huge problem of transitional arrangements. Any deal within Article 50 will only provide for immediate terms of exit, but the new relationship will take much longer to negotiate and then implement. Assuming all third-party agreements that the UK is part of within the EU fall, then it not only needs to renegotiate these, but also add in any new deals it might want. Quite aside from capacity issues, none of this is fast, so businesses will be operating in any uncertain legal and economic environment for a long time.

Are there any grounds for optimism?

Most obviously, we haven’t hit the depths that many feared. Economically, this is partly because nothing has actually changed yet in the UK’s status, but there has been more contingency planning among businesses than in the political sphere, so there is some course of adjustment that could be followed. Politically, the ability of the Conservatives to regroup post-referendum means that early elections look to be off the cards for now.

There is also a diminishing stock of goodwill on all sides around Brexit. Possibly because of a general awareness of how bad things are (and can be), people are trying to find solutions and make allowances for each other. That’s clearly not unlimited, especially if notification drifts beyond early 2017, but the old EU habit of muddling through to some compromise dies hard.

By Dr Simon Usherwood, senior fellow at the UK in a Changing Europe. This is an edited version of Dr Usherwood’s two pieces – The Brexit clusterf**k and More Brexit clusterf**king – which originally appeared on Surrey Politics.

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