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The background
Theresa May January 2017:
“Unlike other European countries, we have no written constitution, but the principle
of Parliamentary Sovereignty is the basis of our unwritten constitutional
settlement….the public expect to be able to hold their governments to account
very directly, and as a result supranational institutions as strong as those created
by the European Union sit very uneasily in relation to our political history and way
of life.”
The background
Fundamentally Britain just never signed up to the idea of an “ever closer union”.
We joined the common market for two reasons.
● Good for jobs and trade.
● Sensible to cooperate for a generation influenced by the memories of war.
Trade benefits realised, but far more visible to the public was the hassle that went with it
There was a growing sense over time that the EU wasn’t following a British agenda. Not on our side.
In nobody’s interests to champion EU agenda.
Scaremongering by press but just really played into the sense that that whole thing wasn’t really worth it.
The campaign
Referendum campaign: those who had status (education, London, salaries) telling
those who didnt how they should vote.
But for those who didn’t have money, all they could see was the difference
between their own situation and that of the people who were asking for their vote.
They didn’t have the assets to become part of the elite, but could see how what
they did have was threatened by immigration some of which was visibly from
Europe’s Eastern expansion
The campaign
Exposed the class divisions in early 21st century Britain: there are now two main
groups, those who successfully move around, or have moved around, in search of
opportunity, and those who are in more settled communities, the latter mainly
outside London.
Analysis by the BBC at ward level showed that the variables of age and education
had the strongest explanatory power for voting patterns, and in fact that this
statistically explained the London result..
No wonder the Leave communities felt “left behind” - as well as having an
economic meaning, that phrase is also literally true.
Cameron’s tactics
The pro-Remain Conservatives in government identified an important group of voters who were concerned
about Europe, and particularly about immigration, but also accepted David Cameron’s leadership and
were prepared to listen to, and ultimately take his advice in terms of how they should vote.
This explained David Cameron’s tactics - to try and appeal directly to this group by negotiating a “deal for
Britain” at the summit this time last year that would make our continued membership of the European
Union palatable to these swing voters.
But the deal wasn’t good enough - left without a plan.
Everyone else
Labour campaign was fragmented and weak
Large businesses that benefited from the single market were fearful of
telling their staff directly for fear of being targeted by strident anti-European
campaigners on social media.
So everyone who wanted Remain waited for everyone else to do the hard work,
and nobody did.
The current situation
Britain and the European Union have stated their intention to divorce and have
instructed their lawyers to work on the details.
We’re getting to the end of the blame stage but not yet got to the level-headed
practical cooperation stage of who is turning up to which child’s school parents
evening.
But there the analogy ends. In most marriages, the details of the agreement don’t
have to go through the Council of Ministers and two separate parliaments, and
you don’t run the risk of losing an election if you get it wrong.
Things we know
First. there’s no going back - the number of people who signed a petition to
reverse the decision never came anywhere near the number of people who voted
to Leave.
And there has been no swing of public opinion. In fact there is a sense that people
instead want the government to get on with it.
We will leave the single market
● It became clear in the months following the referendum result, that free
movement of people was part of the single market deal, and that was
unacceptable to Britain.
● Some people are saying that because the Conservative manifesto for the
2015 election contained a commitment to remain in the single market
alongside as well as the commitment to a referendum, it means people were
misled. But this is just pro-Europeans clutching at straws.
Labour will not oppose Brexit
With the exception of a handful of individual MPs, they did not oppose the
triggering of article 50. They are conscious that due process has been followed
and many of their MPs represent seats that voted to Leave.
The substantive negotiation will take around a year
President Barnier has indicated that the package that is agreed needs to be put to the European
Parliament in the autumn of 2018.
Once article 50 is triggered next week the Commission will seek a mandate to negotiate from the Council
of Ministers. Then we have French and German elections that will mean there won’t be a mandate for any
compromises for a few months.
Theresa May has indicated that the deal should go to the UK parliament before the European Parliament.
So that suggests the deal will be in a form that it can be published in around September 2018.
Theresa May has the option of a general election
For as long as Labour is weak in the polls, Theresa May has the option if things
start going wrong for her, to call a quick election to refresh her mandate and
obtain public backing for her deal or her negotiating stance.
That’s about all we know.
Things we don’t know
● The terms of the deal
● The budgetary cost of exit
● The implications for Scotland
● The nature of any transitional arrangements or implementation period
What happens next?
The talks begin. No doubt there’ll be a lot of speculation and grandstanding.
The UK government will give periodic updates to the UK parliament that will serve both main political
parties well.
Labour will be able to demonstrate that it is holding the government to account, which given its current
position of weakness is the best it can hope for.
The Conservatives will be able to demonstrate leadership and, as the information that is produced
becomes ever-more technical, the public will continue to lose interest and believe that the government is
getting on with it.
What happens next?
The Liberal Democrats however will push for a “meaningful” vote in parliament at the end of the process
that is capable of triggering another referendum. They will not succeed.
The Scottish National Party will try and make Theresa May look unreasonable - for example by refusing
another independence referendum before the UK leaves the EU - in the hope of whipping up greater
nationalist fervour. We saw some of this last week. But with nationalism and pro-Europeanism not
necessarily overlapping amongst Scottish voters, they may also fail.
The European Union will - in parallel - draw up policy papers for a multispeed union to try and save face.
Parliament will get bogged down in the Great Repeal Bill that attempts to transcribe existing EU legislation
that is directly applicable into the body of UK law
The UK public will get bored.
Shape of the final deal
A total package, with the exit bill forming part of the overall negotiation, not preceding it.
A heads of agreement deal on market access that will not be as good as being in the EU, but it won’t be
as bad as some industries fear.
There will be a timescale for different elements of the overall deal.
For the markets, certainty will be as welcome as substance so sterling will regain some ground.
In terms of the substance, it won’t feel like any of the other third-party access arrangements that currently
exist, but it may set a precedent for them over time.
It will be piecemeal and different sectors will be affected in different ways.
Shape of the deal
On average the cost of doing business with the EU may rise a bit, but at the same time it may not be
prohibitive.
There will be no grand payment to a central budget but there may be fees to access specific pan-EU
initiatives, for example in Justice and Home Affairs.
The financial services settlement will be most closely watched by business, where the issue of so-called
“equivalence” of regulation between the UK and the EU will be key - but how is it policed?
The issue of EU citizens currently living in the UK, not to mention Brits abroad, will be prominent in the
media but the government will resist making any early commitments - as we saw last week when the
House of Lords attempted and failed to force the government’s hand.
ConclusionsThe government is in quite a strong position - at home at least. Their strength comes from the operation
of the democratic process.
The Conservatives said in their election manifesto they’d hold an in-out referendum on Britain’s
membership of the European Union.
They won an absolute majority.
The legislation was passed to hold the referendum.
The referendum campaign operated within the law. The result was undisputed. And the opinion polls
have not changed since then.
Conclusions
They say a week feels like a long time in politics, so a 12-18 month negotiation will feel like an eternity.
But as long as the final deal doesn’t feel as if it is against the mood of the referendum result, the public will
feel the job is done and start to move onto other issues.
The economy will keep motoring for the moment. The bad news has already happened.
The main risk to Theresa May comes from her own backbenchers in parliament, as we saw from her
willingness to U-turn on tax last week.
But if she gets into trouble she can appeal over their heads and put the deal to a confidence vote in a
general election.
There are lots of unknowns.
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