In 1942, the then-prime minister Winston Churchill gave a speech in which he declared, “Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.” He was describing a turning point in the Second World War after Britain and its allies overcame German forces at the Second Battle of El Alamein in Egypt.
Churchill said this at London’s Mansion House where Theresa May gave her speech on the UK’s future relationship with the EU last Friday. Thanks in part to the EU, the idea of another war pitting EU member states against each other is unthinkable. But May’s speech marks a turning point too – and a big reality check for her Government.
Significantly, May officially acknowledged that Brexit in the form it was sold to the British people by senior members of her Cabinet – including Boris Johnson, Michael Gove, David Davis and Liam Fox – is simply impossible to deliver. As the leaders of the official Vote Leave campaign, these people promised the UK would get most of the benefits of EU membership outside of the club without bearing the costs or the obligations. May finally came clean on this dishonesty, saying: “How could the EU’s structure of rights and obligations be sustained, if the UK – or any country – were allowed to enjoy all the benefits without all of the obligations?”
That is a huge admission.
The contents of the Vote Leave website were famously deleted after the referendum. Thankfully the content can easily be found online. In its “What Happens When We Vote Leave” pamphlet, Boris and co claimed “the idea that our trade will suffer … is silly.” Davis promised last January that we would get a deal that “will deliver the exact same benefits” that we enjoy as an EU member. Again, a big reality check from May: “Our access to each other’s markets will be less than it is now.” This is unsurprising, given her Government’s impact assessments project the economy will be at least 8 per cent smaller if she pursues her Brexit plans (this will certainly make funding all the extra housing she said we need today all the more difficult).
The Brexiteers also promised a “frictionless” border, not least on the island of Ireland, which is needed to protect the principles of the Good Friday Agreement that brought peace after decades of bloodshed. May dumped this promise in her speech, instead talking about as frictionless a border “as possible”. As Simon Coveney, Ireland’s deputy prime minister noted yesterday, she did not explain how she can protect the Good Friday Agreement if we are outside of the single market and customs union. And no ambassador, diplomat, or British civil servant I have spoken to thinks you can square this circle even with technology.
Finally, during the referendum campaign we were told with certainty by leading Vote Leave figures that the EU will do us special favours in any deal and there would be no fee for access to their markets. Foreign Secretary Johnson repeated this nonsense last September when he said, “We would not expect to pay for access to their markets any more than they would expect to pay for access to ours.” But May has already agreed to pay a divorce bill of up to £39bn.
At Mansion House she went further, exposing the fact that while there was more of a reality check than illustrated previously, she still clings to some of the delusion of the Brexiteers in her party. Not only has she agreed to a vast divorce bill, but she said we would seek to pick and choose those EU sectors we would like preferential market access to, and adhere to the relevant rules and regulatory agencies, in return for “making an appropriate financial contribution”.
Yesterday Jean-Claude Piris, former director general of the European Council’s Legal Service, said in response to this proposed “pick‘n’mix” UK-EU trading relationship that there were “still illusions” on the UK side and the EU was not ready “to sacrifice its [single market’s] integrity or credibility to [give] a favour to UK”, pointing out that other third countries with whom the EU has agreements would expect the same privileges. Current serving EU officials have said the same to me in private in even less diplomatic language since the PM’s speech.
The next step of the Brexit process will be the publication of the draft guidelines on the future relationship the European Council will give to the European Commission and its chief negotiator Michel Barnier, whom I met earlier this year. At the start of the negotiations, they put a host of options on the table for the UK to follow, including a bespoke arrangement that no other non-EU country enjoys, where we remain part of the single market and customs union. May has ruled these out. Consequently, after her speech, the EU has drawn this conclusion: we are heading towards a free trade agreement along the lines of one the EU has concluded with Canada.
As I’ve argued previously, this would be a disaster. The TUC’s general secretary, Frances O’Grady does not pull her punches in saying a Canada-style deal would be bad for workers’ rights, bad for democracy and bad for living standards.
Canada’s deal substantially covers goods not services, and 80 per cent of the UK economy is made up of services. What this means is that inevitably trade with the EU – our biggest customer – will be negatively impacted by the hard Brexit May is pursuing. Brexiteers suggest the US and President Donald Trump will ride to the rescue with a UK-US trade deal to plug the gap. However, Trump insists it will be “America first” – and decidedly not Britain – as illustrated by his announcement of 25 per cent tariffs on our steel, following his attempted 292 per cent tariffs on UK manufactured planes.
As they scramble to retrieve the economic case for Brexit, we have just learnt that ministers want to turn the Commonwealth Heads of Government summit hosted by the Queen in the middle of April into a pro-Brexit jamboree to showcase the myth that new trade deals with non-EU countries can make up for the lost trade resulting from Brexit. As it happens, other Commonwealth countries aren’t too pleased at being used in this way, and have labelled the plan as “too colonial… basically Empire 2.0”.
So the Government has acknowledged, even before Theresa May returns with a draft Brexit deal from Brussels, that we won’t get the exact same economic benefits, there will not be frictionless trade, there is no sign of any extra money for the NHS and, far from a new trade deal with the US, Trump is already slapping our goods with gigantic tariffs. This is the complete opposite of what was promised. To coin a phrase, as we approach the beginning of the end of the negotiations, the British public are increasingly asking a very basic question: is Brexit really worth it? I think not.