David Hayward responds to a recent UK in a Changing Europe report on the future of UK-EU relations, asking whether we might see a closer relationship with the EU over the longer term.
The recent report by UK in a Changing Europe, ‘Where next? The future of the UK-EU relationship’, argues convincingly that, ‘changes to the relationship are likely to be slow and incremental in the immediate future’, perhaps resulting (at the most) in modest changes to the post Brexit trading and withdrawal arrangements made between the EU and the UK, rather than any more fundamental development, such as joining the single market.
It is difficult to disagree with this conclusion. As the report notes, ‘there appears to be little political space on either side of the Channel for a major reconsideration of the relationship…’. In the short term, it may even be easier to imagine a worsening of the situation – for example, if the dispute regarding the Northern Ireland Protocol cannot be resolved.
However, while a much closer relationship is very unlikely in the short term, what about the possibility of a substantial change in the longer term? This is not to indulge in predicting the future. There are no crystal balls. But the future is not entirely unknowable because it carries the traces of the present. As a result, it is possible to look at the evidence currently available and conceive of two different scenarios – a continuation of the current Brexit status quo, perhaps with some incremental change, or, alternatively, a much closer relationship with the EU. Since the former is relatively well understood, this piece will focus on the latter.
The most compelling evidence for ‘closer’ is the change in public opinion since the referendum. In a recent survey of polls, an average of 58% of the public expressed a preference for rejoining the EU. This is due to a shift in the views of previous voters (and abstainers) and the demographic ‘replacement’ of older and often more pro-Brexit voters with younger voters, who would have been more likely to have voted Remain. A recent piece argues that this demographic effect could have accounted for around 35% of the decline in support for Brexit.
There are sensible challenges to the depth and permanence of the current polling – perhaps, when confronted by the ‘trade-offs’ associated with, for example, joining the single market, such as freedom of movement or ‘rule taking’, or simply the prospect of a long and painful negotiation, support for the Brexit status quo will increase. This type of argument may be true, and is, to some extent supported by more detailed polling, but has two possible flaws.
Firstly, the framing of the trade-offs (for example, potential economic benefit versus freedom of movement) risks being overly focused on the dynamics of the 2016 referendum and hence misunderstanding subsequent (and future) changes in preference – for example, perhaps, reduced concern regarding immigration.
Secondly, a frequent assumption is that a future Brexit debate would be conducted on a balanced, factual basis, lucidly communicating the inevitable technical issues. It is safe to say the evidence for this more sensible approach being adopted is not entirely obvious.
However, while it is reasonable to treat the polling today as evidence for possible future change, it is also true there is little chance of a much closer relationship in the near term. As a result, it is necessary to examine why the current level of public support for ‘closer’ might persist in the longer term. In this regard, three conditions might be considered necessary: (i) Brexit continues to be seen as not going well (ii) the economic environment remains difficult (iii) the government of the time has the ‘political space’ to support and implement a closer relationship. In addition, a key underlying assumption is made that the EU (and related countries) will not act in a way to veto a closer relationship, subject of course to their legal and political interests.
In the near term, there is little evidence Brexit will be made to work better. The government has various Brexit related initiatives but for the moment seems more focused on stabilising the situation (for example, through the Northern Ireland Protocol negotiations), and, while Labour is proposing various changes to the current arrangements, none of these seem likely to provide any very material improvement.
It is also apparent that negative views of Brexit are increasingly driven by economic concerns, related both to Brexit itself and the overall weakness of the economy. As a result, it is reasonable to think that much better economic performance might lead to an improvement in Brexit sentiment. However, prospects for strong economic growth seem remote – the Bank of England’s recent Monetary Policy Report expects the UK’s economic recovery to be weak.
Although a high level of dissatisfaction with Brexit may well persist, a much closer relationship with the EU requires the necessary ‘political space’. Here it is worth emphasising not only the Conservatives but also Labour are firmly opposed to major change. This political consensus is a key driver for the view that only incremental movement is possible in the near term. However, if the Conservatives lose the next general election, a key barrier to change would be removed and it is reasonable to argue a Labour government would be more receptive to ‘closer’ if current conditions persist, and a clear majority remains dissatisfied with Brexit.
In conclusion, in the longer term it is possible to envisage, a much closer relationship with the EU. As a result, both supporters and opponents of the Brexit status quo are best advised to take the current polling very seriously. Of course, even if conditions for change remain in place (and perhaps intensify) it is impossible to determine what will happen – will the desire for change outweigh the inevitable concerns and difficulties, or perhaps manifest in another way?
By David Hayward, a writer and former investment banker.