Odds increase for a ‘no-deal’ Brexit transition in December
Standing in for the Prime Minister at PMQ’s yesterday, 29 April, Foreign Secretary, Dominique Raab re-confirmed that the UK Government had no intention of delaying the final transition step in the Brexit process beyond the presently scheduled date of 31 December 2020. The Leader of the SNP, Ian Blackford, had asked was it not better to deploy the extension to the transition period in order to focus the nation’s efforts on dealing with the Coronavirus pandemic. The transition to complete independence from the EU will add yet more uncertainty to an already unique unstable and unpredictable economic and social environment.
His question comes as from all sides – the EU, the wider Parliamentary scrutiny committees, and industry bodies – concern is growing that the UK risks crashing out with a ‘deal’ and in a climate that means preparations in place for a smooth transition will not be in place.
Chair of the Committee on the Future Relationship with the European Union, Hilary Benn MP, set five questions to the Minister in charge of Brexit arrangements, Michael Gove, Chancellor of the Duchy of Lancaster, to report progress on:
- the negotiations on the ‘Future Relationship’ between the EU and UK – along with his current assessment of the chances of agreement in all the areas that the UK wishes to have a relationship with the EU by the December deadline;
- implementation of the ‘Withdrawal Agreement’ – and in particular the timetable for establishing the governance structures, including that for the Ireland/Northern Ireland Protocol – and the UK’s policy for reporting on those discussions;
- the arrangements to identify goods moving from Great Britain to Northern Ireland that may be at risk of subsequently entering the EU;
- Government and business preparedness to implement the Future Relationship – and the mechanisms that are in place to enable the public and private sector to consult and feedback as the negotiations progress;
- the list of the EU agencies and programmes the UK currently participates in – and an indication of whether the Government is seeking to continue this participation after the transition period, and on what terms.
Gove’s response was non-specific, as illustrated with references such as: “The Government and Civil Service are working hard to deliver a complex and challenging portfolio of work to ensure the UK is well prepared for the end of the transition period. This Government has a track record of preparedness on these matters” – and – “We will discuss with the EU how best to manage our friendly relations, but any solution has to respect our red line of no commitments to follow EU law and no acceptance of the jurisdiction of the CJEU. There are limited options for third country membership of EU bodies, and we have been clear we shall be operating on the basis of existing precedents.”
The response was also at odds with official reports from the second round of negotiations between the EU and UK – which were held ‘virtually’ due to Coronavirus restrictions – with little progress reported by either side.
View from the European Commission
Michel Barnier, EU chief negotiator, in his post-discussions press release: “In recent days, the UK government has made clear that it would refuse any extension of the transition period. We take note of this choice. My recommendation is, therefore, that we work hard until June and think carefully about our joint response to this question of extension taking into account the economic situation and the consequences of our decisions.
“Right now though, the consequence of the United Kingdom’s decision is that the clock is ticking.
“We have just 8 months ahead of us to advance on three workstreams: Ensuring the proper implementation of the Withdrawal Agreement; preparing ourselves to the negative economic consequences that the end of the transition period will entail; and negotiating a future partnership between the European Union and the United Kingdom with a view to limiting those negative consequences…
“…But now – if we want to make tangible progress – we need to move beyond clarifications and put more political dynamism into proposals aimed at building compromises…
“…The UK cannot refuse to extend the transition and, at the same time, slow down discussions on important areas…
“…June will also be an occasion do take stock on what real progress the UK has made for the implementation of the Protocol on Ireland and Northern Ireland. We need clear evidence that the UK is advancing with the introduction of the agreed customs procedures for goods entering Northern Ireland from Great Britain. We need clear evidence that the UK will be able to carry out all necessary sanitary and phytosanitary controls, as well as other regulatory checks on goods entering Northern Ireland from outside the EU as of January 2021, in 8 months’ time.”
View from the UK
David Frost, UK chief negotiator for post-Brexit relations with the EU is quoted in a press release from Downing Street as saying that: “Limited progress was made in bridging the gaps between us and the EU.
“Our assessment is that there was some promising convergence in the core areas of a Free Trade Agreement, for example on goods and services trade, and related issues such as energy, transport, and civil nuclear cooperation.
“We regret, however, that the detail of the EU’s offer on goods trade falls well short of recent precedent in FTAs it has agreed with other sovereign countries. This considerably reduces the practical value of the zero tariff zero quota aspiration we both share.
“There are also significant differences of principle in other areas. For example we will not make progress on the so called “level playing field” and the governance provisions until the EU drops its insistence on imposing conditions on the UK which are not found in the EU’s other trade agreements and which do not take account of the fact that we have left the EU as an independent state.
“On fisheries, the EU’s mandate appears to require us to accept a continuance of the current quotas agreed under the Common Fisheries Policy. We will only be able to make progress here on the basis of the reality that the UK will have the right to control access to its waters at the end of this year.
“We now need to move forward in a constructive fashion. The UK remains committed to a deal with a Free Trade Agreement at its core. We look forward to negotiating constructively in the next Round beginning on 11 May and to finding a balanced overall solution which reflects the political realities on both sides.”
Taken all-in-all, the odds of a no-deal Brexit on 31 December 2020 have increased – whilst Government, business and citizen preparedness will be lower than it was a year ago when – before they were re-deployed to dealing with Covid-19 – there were 5,000 civil servants engaged in preparing for the changeover.
Our team has focused for four years on identifying changes, consequential risks to continuity of business, and mitigation strategies. This expert support will be critical in the coming months – and is additional to, not instead of, dealing with the Coronavirus crisis.
We have included references to Northern Ireland in this article – and its unique situation of having a shared and open land border with the EU. This will be subject of a future insight article and report on any findings of a specialised committee on the Northern Irish Protocol – scheduled to meet for the first time on 30 April.
Parliamentary scrutiny, reporting and decision-making processes
Incredibly – with only 8 weeks to go to the deadline for a decision on to apply for an extension to the transition period beyond 31 December – and almost 4 years since the referendum – a new structure for Parliamentary scrutiny of the Brexit arrangements has just been announced.
There are to be 5 Sub-Committees established: EU Environment; EU Goods; EU Security and Justice; EU Services; and International Agreements.
At the time of writing, each of these is no more than title and broad description of the area under focus (details, below). There are no lines of inquiry listed, no meetings planned, no news to report, or any output on record. Put this is the context of a decision in June on extending the transition and the lack of meaningful progress towards concluding a detailed framework to come into play on 1 January 2021.
EU Environment Sub-Committee: examines EU policy on agriculture, energy, climate change, the environment, food, fisheries, biosecurity and public health. It also considers the environmental aspects of the UK-EU level playing field.
EU Goods Sub-Committee: scrutinises the UK-EU negotiations on future trade in goods, including customs, the ‘level playing field’, consumer protections, public procurement and transport. It also considers EU policy and legislative proposals in these areas.
EU Security and Justice Sub-Committee: examines the Government’s approach the UK’s future relationship with the EU in respect of internal and external security matters, including criminal justice, policing, data-sharing and defence.
EU Services Sub-Committee: considers matters relating to the UK’s relationship with the EU in the services sector. This includes trade in financial and non-financial services, as well as UK-EU cooperation in the areas of science, education and culture. The Sub-Committee conducts inquiries in these areas and scrutinises relevant EU documents, asking questions and raising concerns through correspondence with UK Ministers.
EU International Agreements Sub-Committee: scrutinises all treaties that are laid before Parliament under the terms of the Constitutional Reform and Governance Act 2010 and considers the Government’s conduct of negotiations with states and other international partners.
Contact for further insight and support: john.shuttleworth@europartnership.com
References:
Head of EU negotiations, Michel Barnier: European Commission Press Release.
Head of UK negotiations, David Frost: Prime Minister’s Office Press Release.