Brexit: Are you ready to fudge?

June is crucial month for the Brexit negotiations. It may even be decisive. At least, that is what many political pundits, businesses leaders and other observers are hoping for.

This month, Her Majesty’s Government publishes a Brexit ‘backstop’ plan, finalises a blueprint on a future UK-EU partnership and attends the EU Council summit on 28-29th June. Also, the EU (Withdrawal) Bill comes back to the House of Commons, bringing back no fewer than 196 amendments from the upper house.

These developments will all shape the outcome of the negotiations and, therefore, how the UK will be defined as a third country outside the European Union. Unfortunately, the past two years have shown one should not hold their breath for too long when a new milestone is reached in the negotiations process. The divorce is a complicated and divisive task and the EU has been watching from across the Channel how the UK’s infighting is concocting a fudged (dare I say muddled?) response.

Brexit ‘backstop’ plan

On Thursday 7th June, the UK Government published a proposal for a ‘backstop’ Brexit plan. The aim is to avoid a hard border between both Irelands if the future partnership deal between the UK and the EU has not yet been implemented by the end of the transition period in December 2020.

Whilst only being a technical note to the withdrawal agreement, this plan ruffled quite some feathers within the UK Tory party. It proved very difficult for PM Theresa May and Brexit Secretary David Davis to come to an agreement, with DD threatening to resign (again, oops) if the proposal did not include a time limit. He got his way, and May averted another crisis. The text states that the transitional arrangement will only be in place until the future customs arrangement can be introduced and it expects the latter “to be in place by the end of December 2021 at the latest”.

Merely 24 hours later, however, the EU’s chief Brexit negotiator Michel Barnier branded the time limit as “unacceptable” because the backstop has to provide guarantees under all circumstances unless and until a permanent solution is found. Whilst not rejecting the proposal entirely, he said it raises more questions than it provides answers.

Equally important, Barnier criticised the fact that the issue of regulatory alignment was omitted and that, consequently, the border issue between Ireland and Northern Ireland remains unresolved. Barnier called for both sides to find pragmatic solutions. It is, however, a highly political question. The EU wants the backstop solution to be only applicable to Northern Ireland, but the UK is “committed to maintaining the integrity of [their] own internal market. That position will not change” a UK Government spokesperson said.

Lastly, Barnier criticised the British suggestion to stay in “a” customs union with the EU as it implies that public authorities and businesses would need to adapt to this temporary solution before adapting again to a permanent solution. Indeed, this is extremely burdensome to anyone affected and the need to adapt only once after Brexit is an issue the UK has acknowledged in the past too.

EU (Withdrawal) Bill

On Tuesday 12th and Wednesday 13th June, the EU (Withdrawal) Bill, which repatriates EU law into national law to ensure continuation after March 2019, comes back to the House of Commons bringing back 196 amendments from the House of Lords. However, debates will be dominated by the 15 amendments on which the Government was defeated in the Lords.

Tory MPs have been urged not to give in to the Lords’ amendments and to vote with the Government. Surely no one wishes to see the Government fall and enable Jeremy Corbyn to become Prime Minister? Warnings might fall on deaf ears, but it will be interesting to see how those Tory Remain rebels vote. They might pursue their vision of a ‘sensible Brexit’ (as Ken Clarke MP likes to put it) or they might fear a leadership contest that gives way to a hardline Tory Brexiteer and just keep quiet instead.

The amendment causing May the biggest headache concerns giving Parliament a ‘meaningful vote’ on the Brexit negotiations outcome. This amendment provides Parliament with the power to reject the final deal. Brexiteers fear this will put everything into jeopardy. This is definitely one to watch on the Tuesday. Important votes on whether to opt for a customs union and whether to enter the European Economic Area (EEA) are scheduled for Wednesday. Do not take anything for granted, as the Labour Party is also divided on the issue, not least since Labour came out with a new position the previous week to keep full access to (i.e. as opposed to full membership of!) the EU single market. Labour MPs are whipped to abstain on the EEA vote, but there may well be some rebels.

Future EU-UK Partnership and the EU Council Summit

It was expected that the UK Government would publish a blueprint on its relationship with the EU ahead of the June EU Council summit, but it was reported to have been delayed until after EU leaders come together in Brussels. The news obviously came as a disappointment to many who want to avoid kicking the can down the road until the very last minute, but the Government may want to buy itself more time during summer recess. If patience is running low, do not despair: the document is expected to be about 150 pages, so plenty to digest once it is out there.

The EU and UK are currently discussing the framework of a new relationship which will comprise economic partnership as well as strategic cooperation on security matters. According to the Commission, proper negotiations can only officially start once the UK leaves EU institutions. This view is not shared by the UK, but only few people believe that negotiations will reach the detailed technical part before next March anyway.

For now, the EU has repeatedly insisted that access to mainland Europe’s market would not be à la carte and despite the UK acknowledging the four freedoms of the single market, it still looks like a fudged compromise is the only option that will actually be viable. Some might call that an off-the-shelf cake.

"Nothing interests me more than to analyse political dynamics to ensure the client’s voice gets heard through the noise.”"
Cathy Kremer
Consultant