Houses of Parliament

The UK Parliament will be prorogued (i.e. suspended) again on Tuesday 8th October, but this time inside a week as is usual before a Queen’s Speech on 14th October setting out the Government’s agenda for the coming year.  It all however has a slight air of unreality about it, as most observers think that there will have to be an election in the coming months – probably before the end of the year.  The real question is whether the election happens this side of Brexit or the other, and if the other side, will the UK have left the EU with or without a deal.  Whichever comes first will undoubtedly have a significant impact on whichever comes after.  And then there’s the referendum wild card…

The prorogation and subsequent Queen’s Speech debate will allow the Government some brief respite from Parliamentary maneuvering while they see whether the proposals they made at the beginning of the month can form the basis of a deal with the EU.  Judging by the EU’s early response, progress would require further concessions by the UK, which would be easier made without close Parliamentary scrutiny.

Getting the ducks in a row…

Theresa May’s attempts to deliver Brexit foundered because she reached an agreement with the EU which a combination of those most and least enthusiastic about Brexit in the UK Parliament would not support.  Boris Johnson has now proposed a radically different approach, which looks to be heading to the opposite position.

The proposal is that on leaving the EU the UK would enter into a transition period with the EU ending on 31st December 2021 (extendable to 2022). During this period, the UK would for most purposes effectively be treated as a member of the EU. This is the same as the May deal. What is different is that on 1st January 2022, the entire UK including Northern Ireland would form a separate customs territory from the EU. This would require customs checks between the UK and EU. In the case of the island of Ireland, this would no longer mean replicating the “frictionless” trade currently in existence. But it is intended that the “friction” would be kept to a minimum by technology and take place away from the border, rather than on it, thus avoiding the return to the perception of a hard border. Furthermore, the territory of Northern Ireland would prima facie retain full and dynamic regulatory alignment with the EU on agriculture, food and industrial goods, meaning that trade in these sectors would be largely, but not entirely, frictionless. This all-Ireland arrangement would be subject to a positive vote of the NI Assembly every four years. If the Assembly failed to vote to continue the arrangement, there would no longer be regulatory alignment on the island of Ireland in agriculture, food and industrial goods. The UK proposal is silent as to what would happen then, except to propose a pledge by both parties that there would never to a return to border infrastructure between Northern Ireland and the Republic.

The Government looks to have the Parliamentary ducks lined up this time, with a real prospect of a majority in favour of his proposals if the EU would accept them.  But will they?

Almost certainly not in their current form.  While the EU has welcomed the UK’s move to align Northern Ireland with the Single Market and accept regulatory checks between NI and Great Britain, two fundamental problems remain.  First is that according to the Government’s proposals NI would leave the EU Customs Territory but the resulting external border between NI and the Republic of Ireland would be policed remotely with no infrastructure on the border. This, the EU argues, is both incompatible with the Good Friday Agreement because it puts a new barrier into the all-island economy, and incompatible with the integrity of the Single Market because the external border would be inadequately policed (ie. the proposed border is both too much and not enough).  Second, the Government’s proposal that the NI Assembly (Stormont) should have to approve the arrangements both before they take effect and every four years thereafter effectively gives the Democratic Unionist Party (DUP) a veto over the arrangements and a unilateral ability to terminate them with no alternative mechanism to protect the Single Market and uphold the Good Friday Agreement.

…. in time for 31st October?

Getting to a deal in time for the UK to leave the EU on 31st October is not impossible, but time is now very short – the EU is likely to form a view by 11th October whether a deal in time is possible – and significant movement by the UK Government would be needed in order to get there (which would be likely to erode the Government’s level of Parliamentary support for the eventual deal).  The EU appears to believe that the risk of a “no deal” Brexit on 31st October is in practice quite small, not least because of the Benn Act which would require the Government, in the absence of a deal with the EU and approved by Parliament by 19th October, to seek an extension to the Article 50 deadline of 31st October.  “No deal” on 31st October could still happen, if either the Government finds a way round the Benn Act (the authors do not think there is one), or if an EU Member States refuses to agree – neither of these looks likely at this point. There has been some speculation that the Government might request a Member State to frustrate the extension request, but it is hard to see which Member State would wish to expend political capital in causing a “no deal” Brexit – and consequent damage to the EU economy – if the other Member States wanted to agree to Johnson’s reluctant request. So leaving the EU on 31st October looks possible only if the Government can achieve the very fine balance between the EU’s requirements and what Parliament would accept, and can somehow manage to pass sufficient domestic legislation in time.

….. or later?

Any extension to the Article 50 deadline would be likely to lead to a General Election before the end of the year:  the only alternative would be a referendum, but there does not appear to be a Parliamentary majority for that.  This could change:  the Labour Party’s poor poll ratings (15 points behind the Conservatives in the weekend Opinium poll), driven in part by the Party’s equivocal position between leave and remain, make Labour MPs nervous about an early election.  In practice a referendum this could not be until the early months of 2020 at the earliest, and would require new primary legislation – difficult to achieve in a Parliament in which there is no stable majority for anything – and require agreement on a suitable question.  So for now at least an election  looks more likely than a referendum.  From the Government’s point of view, an election following a successful Brexit looks to be the best prospect.  An election in the aftermath of a “no deal” Brexit looks high risk given the uncertainties about what the practical short-term effects of a “no deal” Brexit will be.  An election after a delay (which the Prime Minister swore would not happen, “do or die”) also carries risk, which would probably push the Conservative Party towards more of a “no deal” position in the campaign in order to see off the threat from Nigel Farage’s Brexit Party. Previously, it was considered by many observers that the UK not leaving the EU on 31st October, and in particular Johnson requesting an extension, would be problematic for the Conservative Party.  So the Prime Minister will do all he can in these circumstances to make it clear that he was forced to extend, which he has been by Parliament and may in due course be by the courts.  Conservative strategists seem to think that they could turn this position to advantage in an election campaign.  The alternative to signing a letter requesting extension (or having it signed on his behalf) would be for the Prime Minister to resign, but this looks unlikely both because few Prime Ministers want to stop being Prime Minister, and because the likely result of putting Jeremy Corbyn into No.10 – even temporarily would shock many core Conservative supporters.  Ultimately the authors think that the Government will ask for an extension, and that the EU will agree.

If the Conservative Party emerges from the ensuing election with a clear majority, then the chances of both a deal with the EU and a “no deal” Brexit would increase:  the EU would be dealing for the first time with an interlocutor with both the ability to secure a Parliamentary majority in favour of whatever position emerged, and with five years in which to weather the difficulties of “no deal” before having to submit to public opinion again – in other words both the positive and negative forces pushing the parties towards a deal would be at their maximum. If that happens a majority Johnson government is likely to lead the UK towards a Canada-style relationship with the EU after transition, rather than a Norwegian, Swiss or Turkish type of relationship.

On current polling, a Labour majority looks very unlikely.  So in the absence of a Conservative majority, the likelihood would be either Johnson or Corbyn heading a minority government.  In these circumstances it is difficult to see the deadlock that has affected Parliament since the 2017 election changing, and the pressure to hold a further referendum would be likely to be very strong.  So, in calendar order, the seemingly endless Brexit saga could come to an end through a deal being reached and ratified before 31st October, by the Conservatives winning a clear majority in an autumn election, or by a referendum next spring.