An update on Brexit

It is now six months since Parliament took the momentous decision to trigger Article 50 and give formal notice that the UK will be leaving the European Union and becoming an independent, self-governing country again. Some progress has been made in the formal negotiations that have followed. The needs of Ireland, which shares a land border with the UK and incredibly close trading relations, has been recognised and it has been agreed that there should not be a hard border. The rights of UK citizens living in the EU and EU citizens living in the UK have also been addressed. However, everyone recognises that there is still a huge amount to be resolved and discussion needs to proceed at a pace on the nature of a new partnership between the UK and the EU.

 

The Prime Minister’s speech in Florence last week was an important marker to try to move things forward and raise everyone's sights beyond technocratic issues around money and start to discuss, in parallel, the terms of that new partnership which will be based on cooperation and friendship. The main reason that progress has been slow is because the European Commission has, so far, insisted on following a very narrow and limited agenda in discussions. The idea that you could separate so called "divorce issues" from the nature of any future bilateral partnership on issues like trade and security was always flawed. As the PM said last week, all sides have a mutual interest in developing that partnership and a shared responsibility to get this issue right. The UK is a very lucrative market for companies based in other European countries and those companies want their leaders to engage in this process fully and provide the certainty they need.

 

The speech painted a positive picture of what the future could look like. There will be a new treaty on security cooperation. The UK will continue to play its part in defending the rights and freedoms of other European countries, and will use its military and diplomatic power to help ensure that our shared values are protected. The new treaty would also cover bilateral cooperation on intelligence and policing so that we can work together to fight the common threat of terrorism.

 

The single most important aspect of any new partnership will probably be the nature of the free trade agreement that replaces our membership of the Single Market. The problem with remaining a member of either the single market or the customs union is that it would still require the free movement of people and it would require us to accept the jurisdiction of the European Court of Justice. Continuing to allow the ECJ to overturn the policies of democratically elected governments in the UK would not be consistent with what people voted for last June, so it is not an option. The UK, as a large economy, will need a different sort of relationship to that of smaller countries like Switzerland or Norway. It would not be right to accept a position where we simply became rule takers and had to adopt regulations decided by the EU.

 

Instead, we need a different sort of partnership with bilateral agreements between the UK and the EU. There will be some areas where we want to pursue a different approach on matters not relevant to trade and we will be free to do so. There will be others where we have similar objectives but want to achieve the same outcome by different means. There needs to be sufficient flexibility in our new partnership to allow for mature agreement on such items so that we can offer one another leeway and avoid disrupting trade. The Prime Minister was also right to point out that there is no need to put tariffs in place given that there are not at the moment.

 

Over the last year, a huge amount of work has been done within government to prepare for all scenarios. I have been working on this project in Defra where we are in the process of preparing a new Agriculture Bill to design new domestic policies to replace the CAP, and a new Fisheries Bill to put in place the powers needed as we leave the CFP and become an independent state again, taking responsibility for the management of all fisheries within our waters out to 200 nautical miles or the halfway point. These are major undertakings and there is an incredible amount of detail to untangle. However, both ministers and civil servants are relishing the opportunities created by the freedom to think differently and to design new policies from first principles, including a domestic policy on regional support. It is an exciting and invigorating time for our country.

 

If it turns out that reaching an agreement on a future partnership by March 2019 is not possible, then we will be ready for that and have been working on all the necessary plans to support coming out of the EU without agreement if necessary. After all, we do not need permission from the EU to leave. That is our decision. However, coming out without a new partnership agreed would be a missed opportunity for both sides. There has been a lot of talk over the past nine months about whether we should have a "hard Brexit" or a "soft Brexit". I think what we actually need is a clear Brexit but with a soft landing. The Prime Minister set out precisely the mechanism that could allow that to happen with a short implementation period where we would leave the EU in March 2019 but continue to function within a copy of the EU's trading arrangements while the necessary systems to implement our new, agreed partnership are finalised. There will be some areas where we chart a different course from the moment we leave in 2019 but others where a little longer is needed. The important thing is that the end destination will be clear. We are leaving the EU and becoming an independent sovereign state again. But we want to leave on good terms and for the transition to be as smooth as possible. The referendum result last year was close but clear. If we get this right then in five years’ time, the only question people will ask is why we didn't do it sooner.