Rumours that Tory Brexiteers might challenge May for the leadership over Brexit it is important to look at each factions plans for post-Brexit Britain, more specifically if their plans are achievable.
Theresa May – One foot in reality
May has problems home and abroad on why her Brexit plan won’t work. Her main problem is how to keep the Good Friday agreement intact whilst trying to control migration from the EU. Her original proposal of a Customs Partnership, that would see the UK collect tariffs on the EU’s behalf was rejected by both the EU and Westminster. Westminster voted for an amendment to the customs bill that killed this idea. The other 2 planks of her Chequers deal is free movement of goods between the EU and UK and a common rulebook on services.
Free movement of goods is an arrangement that could be economically advantageous to the EU, and the UK, but has been rejected by Barnier as it compromises the principles of the Single Market. Free movement of Goods would have gone a long way toward solving the Irish Border problem as well as calming the fears of many manufacturing companies like JLR.
Her common rulebook proposal on services will most likely be accepted to be negotiated on by the EU and should lead to nearly free trade on services between the UK and the trade bloc.
Theresa May still needs to solve the problem of tariffs on goods and the Irish border problem but the government is beginning to address the challenges that Brexit will set the economy. Where May goes next on the Irish border problem will be extremely interesting.
Labour – A realistic starting point for negotiations
Labour’s Brexit policy has been criticised for being vague at times but over the last year the party has built up a comprehensive Brexit plan. Whilst Labour Frontbenchers continue to disagree with each other publicly on Brexit, something that may well be a deliberate strategy, Keir Starmer has provided a clear alternative Brexit proposal that is much softer and more realistic than Theresa May’s. Labour want to negoiate a customs union with the EU and an internal market with the EU. The internal market proposal is similar to Theresa May’s common rulebook in its aims. It aims to make sure services can be traded freely with the EU post-Brexit and it achievability is equal to May’s similar proposal. The advantages of a customs union are detailed here, but just as importantly Michel Barnier has continually said the EU is “open to a customs union”.
Such customs arrangement would allow tariff-free access to the single market for goods whilst its proposals on the internal market hope to achieve free trade on services.
The place Labour may be kidding themselves is on international trade and rule taking. Though Labour want ‘a’ customs union not ‘the’ customs union making deals with 3rd party nations might be hindered or impossible, meaning our international trade would remain as it was pre-Brexit. Though it is worth noting Turkey has free trade agreements with other countries whilst being in a customs union with the EU, however, it sacrifices a say on EU trade deals doing so. Politically Labour would more likely prioritise control, to make sure the UK is not a rule taker, but going into negotiations on a customs unions aiming for both is a competent strategy.
Labour have a realistic plan and should Starmer be delivered into the negotiation chamber in Brussels the grey areas mentioned would be coloured in.
ERG: Tory Hard Brexiteers- Trapped in Fantasy
2 years after the referendum result the hard Tory Brexiteers finally presented a plan to how they think Brexit should be handled. To say it was inadequate is being kind.
Their proposed solution to the Irish Border problem is a smart border that they say would mean the Good Friday agreement would remain intact, citing Norway and Sweden as a good example. Forgetting that Norway and Sweden are both in the EU’s single market meaning there is no need for a hard border anyway and that in August 2017, the Centre for Irish and European Security said suggestions of a “frictionless” border were “complete nonsense”. Sinn Fein dismissed their proposals as “pure fantasy”, however, a more accurate assessment could be labelled ambitious if other factors play out, impossible if they don’t. It is certainly impossible under a no deal Brexit.
The deal the Hard Brexiteers are aiming for is the one Canada negoiated with the EU, which eliminated 98% of tariffs. They make no commitments on how to maintain free trade of services. These proposals have been achieved by Canada but are unworkable with the political scenario the UK is in considering the Good Friday Agreement and how key the EU is to the UK economy.
When the Hard Brexiteers realise this they will call for us to exit without a deal, as a threat to get a deal, this would be awful for our economy, far worse than it would be for the EU but many Brexiteers believe this is the method to getting such a deal. To slap tariffs on 53% of the countries imports and 44% of its exports would be extremely damaging to the economy. Many corporations would up and leave. Tariffs will be passed on to consumers as price rises meaning the average citizen will be paying for Brexit and this will lead to less spending and decreased growth. The Treasury estimates this would cost the economy £252bn over 15 years and the Chancellor said the government would be forced to borrow £80bn more a year should the UK crash out without a deal.
Rees Mogg says more details of the ERG’s plan will be revealed this week which hopefully will address the issues highlighted.
Labour’s soft Brexit rebels- A Done Deal
A considerable amount of Labour’s PLP wants a Norway style deal with the EU. 75 MPs defied the Labour whip to vote for continuing EEA membership post Brexit. The EU is open to Britain remaining in the single market post Brexit, as it will for 2 years due to the transitional period negotiated by the government. It has stated the UK has until 2020 to decide if it wants to stay in the EEA and customs unions. These rebels are about as far from power as Parliamentarians can be so EEA membership is as far as their plan goes but it is still a realistic alternative that the British Public would favour compared to a no deal Brexit.