GE2017 and International Relations: The Mandate for Brexit Remains Unclear

Posted in: Brexit, Economics, European politics

Dr Maria Garcia is Senior Lecturer in the University of Bath's Department of Politics, Languages & International Studies.

This week – just under three months after Article 50 was triggered, announcing the UK’s decision to depart from the European Union – Brexit negotiations have commenced in Brussels. British negotiators led by David Davis, Secretary of State for Exiting the European Union, arrived in Brussels under very different circumstances than they had envisaged a couple of months ago. Prime Minister May’s gamble, calling an early election to bolster her parliamentary majority in the hope of gaining a robust mandate to conduct negotiations, has backfired spectacularly. If the outcome of the EU referendum divided the country (without clarifying what kind of trade-offs the population would be willing to accept in Brexit) the 2017 election again reflected the cacophony of views in the country. Nor have any of the acceptable trade-offs been clarified.

From the outset of her premiership Theresa May, as well as prominent Brexiteers like David Davis and Boris Johnson, have insisted on a leaving the EU but retaining a ‘deep and special relationship with allies and friends in Europe’ and trading freely. They have also reiterated the mantra of regaining border control, reducing immigration and escaping the authority of the European Court of Justice (ECJ), as well as enacting an independent trade policy. These aims featured prominently in PM May’s letter triggering Article 50, the White Paper on Brexit, various speeches and the Conservative Party Manifesto. Yet nowhere has there been any detailed explanation of how to bring about their vision. By the time the election was called it had become clear that their reassurances of economic ties remaining the same and enabling business to continue as they had until now – whilst also fulfilling the Leave campaign’s requirements of ending worker mobility and ECJ jurisdiction – were illusory. This is not surprising, given the constitutional constraints on the flexibility the EU has in negotiations; the single market is predicated on the four freedoms of movement (including labour mobility) and the ECJ as the overarching arbitrator and guarantor of the market. David Davis’ and Boris Johnson’s claims that there was no need to pay a Brexit bill (to settle financial commitments the UK has already made and payment of British EU civil servant pensions), which is in fact the initial part of Brexit negotiations, further added to speculation that the UK government’s preferred variety of Brexit would involve a complete break from Brussels – even though they constantly referred to a deep and special relationship and continued trade on the current basis. PM May did, however, present a more nuanced appraisal of the situation by accepting the commitment to pay a ‘reasonable’ bill and the possibility of paying for participation in certain EU projects (see White Paper and Manifesto). Senior members of the Conservative Government articulated different approaches to the negotiations, but coincided in putting forward an unrealistic vision of a future relationship with Europe. During the election campaign, a more realistic vision failed to materialise, with the Conservative Party Manifesto reiterating incompatible objectives, and campaign rhetoric focusing on personal character for engaging in challenging negotiations with the EU. During the campaign, the Conservatives failed to present what it was they actually planned to negotiate, and therefore what they were seeking a public mandate for through the election.

Brexit was clearly a crucial aspect of this election, but it is impossible to claim that Labour’s surprising improvement in votes was exclusively down to Brexit – not least because Labour’s position on the matter is vague too, despite a commitment to negotiate it. Now that the Conservatives have lost their parliamentary majority and need to rely on the support of the DUP to govern, their manifesto promises regarding avoiding a re-instatement of customs controls and borders between Northern Ireland and the Republic of Ireland become more significant – and may affect the choices available in the Brexit negotiations, since leaving the EU with no (temporary) deal in place would legally mandate a hard border. Moreover, the lack of majority means that as Brexit negotiations unfold, a greater proportion of views and positions will be discussed in Parliament. Whatever is agreed will have to be the result of consensual agreements. Considering the significance of Brexit and its effects on every person and economic activity in the country, a more negotiated and consensual outcome can only be welcomed, not least given the very narrow majority in favour of Leave in the 2016 referendum.

Initial statements from members of the new government are reflective of this situation. Andrea Leadsom, as new Leader of the Commons, announced over the weekend that the Government will not put forward a new legislative plan next year to leave space for Parliament to scrutinise and pass the necessary legislation around Brexit – and admitted the need to secure consensual support for Brexit plans. Departing from the David Davis, Theresa May and 2017 Conservative Party Manifesto line, Chancellor of the Exchequer Phil Hammond admitted in an interview on the Andrew Marr show that leaving the EU with ‘no deal would be a very, very bad outcome for Britain’; he also admitted the need to put in place a temporary agreement that ensures business continuity on current terms, extending beyond the end of the two-year Article 50 negotiations and providing support until a new long-term relationship can be agreed to. PM May’s new cabinet remains a mix of Leave and Remain campaigners, with notorious Leave supporter Michael Gove returning to the cabinet as Secretary for the Environment. Perhaps more reflective of the changed parliamentary situation, and May’s need for allies, was the appointment of Damien Green, a personal friend of the PM and pro-EU advocate who will take on the role of First Secretary. The election results, the support of the DUP, and the Exchequer’s public statements suggest that a more moderate tone will be taken in negotiations than indicated by some of the pre-election rhetoric.

However, critical questions remain unanswered. Leaving the EU, even if it is an orderly manner with intermediate stages aimed at minimising trade disruptions – as now appears to be more likely – means that the UK’s future relationship with the EU will of necessity be different. Consequently some sectors and groups that benefit from the current arrangements will find themselves in an inferior position to today (e.g. financial services). Others may well find that they benefit from different arrangements. A ‘Brexit that works for all’ is a fallacy, unless the government is finally willing to enlighten the population as to exactly what sectors it will prioritise in the negotiations and what sectors it will sacrifice, and what measures it will put in place to compensate sacrificed sectors. The same logic applies to any future post-Brexit UK trade agreements with the other states – especially the US, where Secretary for Trade Liam Fox is this week discussing post-Brexit possibilities.

All trade agreements have redistributive effects. The EU trade agreement with Canada (CETA), when it comes into effect later this year, will increase competition in the European market for European beef producers by allowing increased beef imports from Canada – where larger production facilities and the use of cheaper animal feed result in high production. By contrast, European speciality cheese producers are set to benefit from improved access to the Canadian market and the protection of some of their speciality names linked to specific locations – to the potential detriment of Canadian cheese producers.

Throughout the referendum campaign, the run-up to the triggering of Article 50, and even during the electoral campaign, open and frank discussion of which areas, economic sectors, societal groups and companies would be privileged in these challenging negotiations (and in future domestic and trade policies) was neglected. The government’s plans for an Industrial Policy, although still lacking in detail, are an important first step towards acknowledging the need to equip people with relevant skills, and to foster innovation in the country so that it can retain a competitive edge in global markets. In and of itself, however, it will not suffice – especially when in future negotiations with other states, they may press for their own interests (consider India’s pursuit of access for its IT workers to labour markets elsewhere as service providers, for example). Over the coming years, at a time of rising global tensions (geopolitical as well as economic), Brexit will be the overriding issue of UK foreign policy. A more subdued approach to Brexit, with intermediate steps, such as remaining in the European Economic Area or the customs union on a temporary basis as suggested by the Chancellor of the Exchequer, can curtail some of the economic shocks to various sectors – but the current Parliament, and society, would do well to insist that the Government reveal their longer-term plans regarding the relationship they hope to have with the EU and other markets. They should also be put under pressure to explicitly identify the winners and losers of such plans, as well as remediation measures. Without this information, manifesto promises to tackle inequality in the country (an obvious and pressing problem) may fall by the wayside in the re-crafting of the country’s socio-economic environment and its international position and relations.

Posted in: Brexit, Economics, European politics


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