Transcript
Brexit: What to Watch
Georgina Wright
Senior Researcher, Institute for Government
Anna Isaac
Trade and Economics Correspondent, POLITICO Europe
Professor Richard G Whitman
Associate Fellow, Europe Programme, Chatham House
Professor Vernon Bogdanor
Professor of Government, King’s College, London
Chair: Professor Anand Menon
Director, UK in a Changing Europe
Event date: 11 December 2020
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2 Brexit: What to Watch
Professor Anand Menon
Hi everyone, and welcome to this Chatham House event on Brexit: What to Watch. We could call it Brexit: Is it really still going? I suppose, but we’ve got a lot to talk through. We’ve got a fantastic panel to do that. Georgina Wright from the Institute for Government. Anna Isaac from Politico. Richard Whitman, who’s an Associate Fellow at Chatham House and also of the University of Kent and Vernon Bogdanor, who’s a Research Professor at King’s College London. Talking of which, I’m Anand Menon, also from King’s College London, and the way we’re going to proceed is, we’re going to sort of have a discussion as a panel. I’ll try and talk to each of the panellists a little bit to start with, after which we’ll welcome your questions. I should say that this is being recorded. You are being – it’s on the record. You’re encouraged to tweet if you want to do that sort of thing, using the #CHEvents. And when it comes to questions from the audience, if you can submit them through the ‘Q&A’ function on Zoom, we’re then hoping, rather heroically, that we can get people on mic to actually ask their question when I call on them. If, for any reason, you don’t want to speak or can’t speak, add that to your question and I’ll try and integrate your question into our conversations, so that it gets asked. But do please start sending your questions in early, because if I can filter some into our conversations, I will, so we can cover as many of them as possible. I think that’s everything. I’ve almost certainly forgotten something, but we’ll see what happens if we go from here.
So, Georgie, I’m going to start with you, with the easy question, what’s going to happen?
Georgina Wright
Thank you so much, Anand, and thank you, Chatham House, for the invitation to be with you this lunchtime. Well, what’s going to happen? No-one really knows, to be honest. 21 days to go until the end of the transition period, where we know that deal or no deal on the 1st of January, the UK/EU will be trading on radically different terms. So, where are we? Well, we’re still at it and 98% of the text, according to reports, has been negotiated and agreed to.
We know that the Prime Minister went to Brussels on Wednesday. He met with the Commission President who helped hold face-to-face talks. They decided that their negotiators should have a final go, and they set Sunday as a potential deadline. We don’t know whether these talks are going to lead to a breakthrough or a breakdown. Again, we apparently, Sunday is the day where we will find out. But as with much of Brexit, that could shift as well.
We know that the EU leaders also met in Brussels on Thursday and today for their course of the European Council, where, according to reports, they spoke eight minutes about Brexit. So, lots of other things that they needed to discuss. And we know at the same time that the Prime Minister obviously came out last night and said there was a very, very strong possibility that the UK and the EU would fail to reach a trade agreement by the end of the year.
So, the mood music is a bit pessimistic. But on a more positive note, we know that there was a breakthrough in the Joint Committee, which is the UK/EU forum responsible for overseeing the application of the Withdrawal Agreement, which was of course passed in January. And there have been lots of decisions there made that will impact Northern Ireland and particularly trade between Great Britain and Northern Ireland, which I’m sure Anna has views on that, and we can come back to later.
So, there has been some kind of positive news on the Brexit front this week. Will we have a deal? Look, if we are to have a deal, it will be the result of compromise, where both sides are going to have to move and 3 Brexit: What to Watch
give in. The key question really is, is it a deal that both sides see as a price worth paying? At the moment you’re hearing that actually, they don’t think that what’s on the table is okay, and that we know that in any case, there will be disruption. So, I think for the Prime Minister in particular, and Anand, this is something you’ve said before, in a deal scenario, the Prime Minister has to own that disruption. In a no deal scenario he could potentially he could potentially blame the EU. So, it’s not just about the deal on the table, it’s also about whether you can sell it politically, and what it will do to your own domestic audiences. So, there’s a lot in play. Everything really now lies on what happens over the next couple of days, and we shall see.
Professor Anand Menon
And it’s worth that regular reminder, isn’t it, that, you know, other people have domestic audiences too, and so it’s not – I think, in this country, we tend to think that we’ve got political constraints and everyone else is being stubborn. Whereas, in actual fact, we’ve all got them. So, Anna, I mean, it’s interesting, isn’t it? Because there’s been a lot of talk about this being a thin deal that’s being negotiated, though it sounds quite a long thin deal. Is there a massive difference economically speaking or for businesses between deal or no deal at this point?
Anna Isaac
It’s very difficult to answer that question, and I think, as we get crunchier and crunchier with the economic forecasts of addressing that very question, we’re seeing how very difficult it is for people to puzzle it out. Now, that’s not because of the tariffs, ‘cause you can model tariffs into an economic forecast quite easily. It’s because of the non-tariff barriers. So those barriers that we’re going to have deal or no. What’s the actual impact of slowing goods at a border because they have to fill out a form? As much as whether or not they have to pay a fee. Paying a fee or tax as the tariff is might determine whether or not the goods get to the border in the first place, but they don’t tell you how reluctant businesses will be to try and deal with the extra headaches involved.
It’s also that we don’t necessarily know what a lot of the non-tariff barriers might look like ‘cause of services yet. We know some things are probably off the table, like mutual recognition of professional qualifications, which is fancy talk for if you qualify as an Architect in the UK, will you be recognised as an Architect in Germany or elsewhere? Ditto with being an Accountant etc., in other areas. So, we know that mobility is going to have a big impact. But we don’t know how great that will be. We’ve also lost our counterfactual because of COVID. So, we don’t know what mobility would have looked like in a normal world, where we’re all dealing with lockdowns. We don’t know what the UK economy would have looked like in a non-pandemic world. Which comes back to this point about selling a deal versus no deal. That political implication of not having that clear counterfactual, that clear what would the world have looked like had it been for a different course of Brexit, is going to make it easier in some ways to sell whatever deal we have and harder in others. So future prosperity on the one hand, versus the current state of play. We won’t really, really know what the hit of a no deal would be very immediately.
There’s also different kinds of no deal. So that’s a really big question for businesses. We’ve seen with, and Georgie touched on this, this issue with the Northern Ireland Command Paper. We are starting to get a picture of what no deal might look like from that, in that you’ve got three months, six months and 12- month provisions for different areas. And so that shows a willingness to mitigate some trade disruption, but there are very clear, stark deadlines. So, it’s a scramble period, basically. And so, what we’re likely to see is a scramble period in the event of no deal, rather than necessarily a complete cliff edge. But there are areas where it could be. They’re trying to move forward on data adequacy. There would probably be 4 Brexit: What to Watch
something like a six-month provision, based on the latest reporting. But that’s one of those areas where, if we don’t get something beyond that six month, we start to see all of these different cliff edges for different sectors of the economy, and that becomes very, very painful.
We’ve also got businesses who will have to scramble to try and deal with whatever rules of origin are contained within a deal, to try and get their heads around what that picture will look like. There are provisions, within the Northern Ireland Command Paper to show us, oh, hang on, this could be baked into an FTA. So, there are provisions within the Command Paper that show us what a deal could look like, but they also show us that no deal is not necessarily pure disruption, but it’s tough.
Professor Anand Menon
The implication I took from the sort of arrangements on Northern Ireland, was if you live there, you should probably start stocking up on Tesco burgers now, while they’re still available, rather than waiting for the end of the mitigations, when they might not be. But I mean, what, actually – just a quick follow-up for you, Anna, which as a Political Scientist fascinates me, is how apparent to your average voter will the economics of – I mean, discount the – I don’t mean the disruption at ports and stuff early on, I mean, moving forward, do voters think, “Oh wow, this isn’t good. This must be Brexit”? Or is it far more subtle and disguised than that, in terms of how this feeds through into day-to-day life? I mean, businesses will feel it, but will…?
Anna Isaac
I think the average political operator, i.e., the average voter, has become much more attuned to it and for one reason, based on all the vox popping I’ve been trying to do recently, is supermarkets, and people stockpiling at supermarkets. It has suddenly made people much, much more alert to the impacts of economic disruption on their everyday life. And also, they are much more sensitive to the small price changes in everyday goods. So, people are really feeling the pinch. We’ve got a massive uptick in unemployment, that’s quite hidden in the official data at the moment, because of the job retention scheme. And so, all of that sensitivity around small price differentials, supply, getting the things they want at a time when they need comfort, i.e., if they can’t get the chocolate they want, things like that, is really starting to hit home because of COVID. So, I actually think the political awareness of trade has rocketed in the last year, in the way that we just didn’t have 18 months ago. The abstraction is gone, and people want to know how they’re going to get by.
Professor Anand Menon
Interesting, interesting. That changes things a lot, actually. Richard, if I can come to you next. I mean, we don’t talk about it enough, but I mean, Brexit isn’t just about what happens domestically, it’s also about Britain’s place in the world and going forward, I suppose, two questions. How does Brexit impact on our foreign and defence policy ambitions and where do you think the UK is headed as a foreign policy player?
Professor Richard G Whitman
Thanks Anand, and I was fascinated to hear what Georgie and Anna said, and as you suggest, I was going to pull back a bit and perhaps ask some questions about the sort of foreign policy impact. Now, I think we’re all aware of the fact that the UK’s taken a bit of a hit, in terms of reputation. I mean, its public diplomacy hasn’t been as adroit as it might have been, and certainly, you know, there’s been puzzlement, 5 Brexit: What to Watch
certainly in other European capitals on occasion, as to what the UK’s about. But some of the interesting questions to me are, you know, so what happens to the UK after the deal? What kind of a European power does the UK want to be? What are its ambitions within Europe? And, you know, the House of Commons Foreign Affairs Committee spent some time trying to work out exactly what was Britain’s European diplomatic strategy for the future, and they drew a bit of a blank. And I think what we’ve tended to have in place of that is the sort of platitudinous, where we’ve been told, of course, that the UK is leaving the EU, it isn’t leaving Europe. And sometimes that’s acted as a replacement for a sort of clarity as to what Britain might want.
There are, of course, bigger questions, aren’t there, as to what the British model of capitalism might look like, you know, whether the UK will be a more trans-Atlanticist economy, what contribution might Britain make to the European Security Order. Really, really big questions that obviously are further down the line, in terms of the UK, where the UK fits. And I think one of the things, perhaps, which has gone a bit under the radar on the Brexit negotiations is that foreign security and defence policy was an area that the UK didn’t want to negotiate with the EU on. And you can read that in a number of ways, and we’ve produced an expert comment from Chatham House on it. But it means, essentially, that you know, the core, some of the core strengths that the UK has are not issues that are being worked through with the EU. And I think part of that’s the EU’s fault, that they’re offering was a fairly pallid one. But I think, you know, the broader need for the EU and the UK to sort of connect on a whole range of foreign policy issues, not just the CSDP/CFSP stuff, but environmental, security, the kind of issues that we’ve seen come out on Hong Kong, and the right space foreign policy issues, and so on and so on.
All of that is going to have to be – going to have to be worked through. And what we’ve had, from the Government so far, is that the Government wants to see the UK being even better friends than was the case previously, and better neighbours. But, you know, the question is really begged, I think, after this agreement’s reached, assuming that it’s reached, what does that mean? What does that mean substantively, beyond what I think has been the primary focus so far, which has been to press on the security and defence stuff, and perhaps to give the impression sometimes that the UK should seek to do – should seek to carry on playing Sparta to Brussels’ Athens. In other words, you know, focusing on the defence stuff, and that will be the UK’s major contribution to the sort of security and diplomacy of Europe and to me, this really, you know, is a pretty big, underexplored issue for the day after the deal.
Professor Anand Menon
Absolutely, and I think you’re spot on. Vernon, turning to you last but not least, you may wave your book at this point if you want, Vernon. Well worth a read, Vernon’s book, not least because it provides a welcome degree of sort of historical perspective. And what I’d like you to do, Vernon, if you can do this in a sort of brief way, because it’s a long, long story, is reflect on what history can teach us about where we are now, and on the basis of that, where we might be headed, if that’s not a terribly unfair question. Oh, you’re muted, Vernon.
Professor Vernon Bogdanor
Indeed. I think the best way to start is by looking at the purpose for which the EU came into existence and it was to secure peace in Europe. It was a peace project. It wasn’t fundamentally an economic project, still less a federal project, but a peace project. And it was to secure peace by transcending nationalism through creating a liberal supranational order in Europe. And from that point of view, it may seem that Brexit is an instance of a more general trend in the world of pressures on that liberal order and 6 Brexit: What to Watch
a weakening of international institutions, and a weakening from voters, who are sometimes called nationalists, but they’re not only nationalists they tend to be communitarians as well.
For example, one of the pressures, one of the reasons for the pressures to restrict immigration was not only connected with the nation, because it alters the community, and it has social effects on the community, on which people were not asked. They did not give their consent to these changes and these changes are associated with economics, and above all, culture. What are your educational qualifications and where do you live? Now the exam-passing classes to which we all belong, we live in cosmopolitan areas, primarily London, which voted Remain, and we’re more at home in Brussels and in Berlin than we are in Bolton or Bishop Auckland. But 60% of people in Britain live within 20 miles of where they were born, and economics also, what sort of area do you live in and what work do you do? Is your perception one of economic vitality, in which case you’ll vote Remain? Or is it of economic decline, in which case you will vote to leave?
And the referendum, interestingly enough, gave proportional weight, which the electoral system doesn’t, to the Leave voters, who, many of them live in safe Labour seats and therefore, their votes don’t count much in general elections. In a referendum, every vote, of course, counts. Interestingly enough, the US electoral college gives a disproportionate weight to communitarians. So, Brexit seems an instance of a more general phenomenon. And the consequence is sometimes seen in very pessimistic terms, in a very, otherwise a very kindly review of my book, Richard Evans, the Cambridge Historian, said that I don’t consider that how Brexit has unleashed demons of anger and prejudice in English culture. Well, I don’t consider that ‘cause I don’t believe it to be true.
It’s very interesting that in March last year an Ipsos MORI poll showed 48% believing that immigration has had a positive effect on the country. Much higher than in any other country in the European Union. Migrants are much less likely to be unemployed in Britain than, for example, in Sweden, in Austria and in Germany. We return more non-white MEPs than any of the other 27 member states. 19 of the 28 returned none at all. And now it’s coming to be the case that ethnic minorities are more likely to be in professional jobs than Whites, and the people who are least likely to get into university are White teenagers. Above all, we are the only major state with no populist or racist party within our legislature, unlike, for example, France or Germany or Italy.
So, Brexit, in my view, shows the tremendous strength of Britain’s liberal culture, and that is very important to Europe. So, it’s not, in fact, an instance of what it seems at first sight, of decline of liberalism in Britain. And from that point of view, Britain is important to Europe, even after Brexit, as a bearer of liberal political culture, and important also, for the reason that Richard gave, that without Britain, Europe can’t defend itself. It’s worth pointing out that the EU is one of – the only one of the four major powers in the world, which cannot defend itself, but relies on an outside power for its defence, 75 years after the end of the war. So, on both of those issues, on the question of transcending nationalism, of creating a liberal political culture and in terms of defence, Britain is vital to Europe, and that should be appreciated on both sides of the negotiation, in my opinion.
Professor Anand Menon
Thank you. It’s interesting, isn’t it, how the debate got so locked into red lines and details, that the sort of bigger picture of sort of strategic interdependence kind of got a little bit lost from view. We’ve had a load of questions in already, and I’m not going to ask all of you for an answer to all of them, otherwise we’ll be here all week, but there’s one here from Euan Grant that deals particularly with Scotland and whether the 7 Brexit: What to Watch
outcome of these negotiations will have a bearing on whether we end up with an independent Scotland or not? Is there anyone who wants to speak on this theme, amongst the five of you? Don’t all rush at once.
Anna Isaac
I can come in.
Professor Anand Menon
Thank you.
Anna Isaac
Look, it’s very difficult to obviously say what the – how the Brexit outcome will, you know, determine the future, what impacts it might have on the future of the Union. But suffice to say, I think, you know, on the 1st of January the UK and EU will be trading on radically different terms, but also, the UK will have taken back control of a lot of policies that were set in Brussels. And that, I think, poses a really important and valuable question for the UK Government, which is how is it going to co-ordinate all of this policymaking with the devolved administrations? How can they be part of the conversation? What does an effective communication look like? How does that policy process work? Particularly with devolution and just the mere fact that world devolved governments will have some direct power in setting – you know whether that’s sort of in farming or other policy areas. So, there is a question there, and I think, from what you’re hearing and what you’re reading, that the devolved governments haven’t always felt included in the Brexit process.
There was certainly criticism at the start of the way that Theresa May had led the negotiations. It improved slightly towards the end of her Prime Ministership and then, of course now, we’re hearing reports that it’s strained again, although Michael Gove is supposedly very – like, regularly in contact and really thinking constructively about this. So again, I think the question isn’t just about the future of the Union as an entity, but very much the future of how it can function. And if we are going to be ambitious with new agricultural policy, more farming policy, whatever it might be, then we need to think very creatively about how we can have a kind of, you know, country-wide approach, as much as sort of regional differences.
Professor Vernon Bogdanor
Can I make a point here?
Professor Anand Menon
I want you to come in, because Robert Cooper said I’ve got to ask you this question.
Professor Vernon Bogdanor
Well, it does seem a bit odd, if you can’t form a relationship with your closest neighbour, then to want to form close relationships with 27 other countries, many of which are far away. It’s like a man who wants to divorce his wife, after a very long marriage and says, but he wants to seek partnerships or relationships with 27 other women, some of whom he doesn’t know, who live very far away, in Latvia, Estonia, Poland and the rest. I mean, if you’re not prepared to share power with your nearest neighbour, where you’re 8 Brexit: What to Watch
represented in the legislature, it is very peculiar to want to share power with 27 other countries. And of course, this is a comparatively new position for Scottish Nationalists, because in 1975, the SNP was the only party in Scotland, which advocated leaving the European Union, and people were very worried that the reverse would happen to what happened in 2016, namely that there’d be a UK majority for staying in, but a Scottish majority for leaving. At some time, the SNP changed its policy, and I’ve never seen a good explanation of what reason there was for that.
Professor Anand Menon
Isn’t the explanation asymmetrical devolution, Vernon, which is to say that the belief that in the European – small states are disproportionately well-represented inside the European Union. The Scots feel disproportionately sort of left out and bullied and the Brexit process hasn’t helped when it comes to the United Kingdom, and actually, isn’t that one of the reasons? I mean, apart from the sort of the nationalist angle to this, there’s a frustration at the lack of influence that they have over what goes on because our system is so asymmetrical.
Professor Vernon Bogdanor
Scotland has the best of both worlds, because it has control over all domestic policies, Health, Education, Transport and after Brexit, Agriculture and Fisheries, broadly speaking. Foreign policy and economic policy are with Westminster. Scotland now has, in effect, almost total powers over income tax. But it’s true that Brexit has altered the situation and that there’s a feeling that it’s been pushed out of the European Union, against its wishes, and that’s certainly the case. But it’s got a very good deal indeed out of devolution, very wide powers, and there can’t be, I think, any complaint about its domestic policies. There might be complaints about macroeconomic policy and about foreign and defence policy, but you can’t argue that an independent Scotland would have greater weight in those areas, from as part of the United Kingdom. Small countries don’t have much of a say in EU economic policy or foreign and defence policy.
Professor Anand Menon
As we speak, Chatham House is scheduling that debate between Vernon and Ian Blackford for spring of next year, which will be a treat to watch. Anna, you spoke earlier about different sorts of no deal. I mean, in that context, and I’m not sure if this will work technologically, but John Peet has a question that I want to go to you first, because it’s about what happens after no deal. But John, I’m hoping someone is going to allow you to speak and I’m hoping it’s not meant to be me.
John Peet
Hi, can you hear me?
Professor Anand Menon
Oh wow.
John Peet
Oh, alright, if you can hear me, then. 9 Brexit: What to Watch
Professor Anand Menon
Look at that.
John Peet
Hello, thank you very much, and I’m enjoying this. I wanted to ask the question about if it’s no deal, could negotiations take – could we get back to the negotiating table quite quickly, or is it more likely that no deal turns into an acrimonious and near-permanent state?
Anna Isaac
Is that for – I’m happy to jump in on that.
Professor Anand Menon
In the first instance, Anna, yeah. I mean, it’s just because you said different sorts of no deal, so if you can touch on that as well.
Anna Isaac
Yeah, and Georgie might need to jump on that as well. Very quickly, in terms of the business impact, would be so aggressively bad, that if you’re thinking about it from sort of selling it, in terms of Government’s relationship with business, it would be very hard to have a cliff edge type moment where you don’t even get some kind of trade continuity agreed, and then very rapidly say, “We’re going to get back round the table.” Because you’d need to say, “We had a big falling out. They were super- unreasonable. We couldn’t do it. So, we’re going to chuck a bunch of money at you, furlough on crack as it were, to try and get you through this difficult time.” So, you – I think to then wind down and get back round the table immediately, I would find that very hard to believe. You’d also will have effectively sort of torn up some of that alignment in a way, because there would be very big movements, I would have thought, in areas like state aid. So, you would have to then get round the table and think of it much more like a negotiating a more standard FTA, and that would take years, and most likely. So yes, that would be my starter for ten on that one.
Professor Anand Menon
I do hope someone’s tweeted “furlough on crack.” If they haven’t, could someone do it? Georgie?
Georgina Wright
I mean, John and I have already spoken about this before, I think. I completely agree with Anna, and I think on the EU side, although I don’t think this is a view shared in Brussels, but certainly in EU capitals there is – some people think that oh, actually, if there’s a no deal it will be so painful that the UK will be rushing back to the negotiating table. I think Brussels know that’s not the case, and I think slowly that message is going round as well. You know, and I think it’s going to have to take a while before both sides are ready to come back to the – I mean they’ve been at it for four years, non-stop. And, you know, if you’re talking about a new FTA, you can’t really pick up where you left off. You know, for the EU they need a new mandate, and some member states might be even more intransigent, might have, you know, have more red lines that they want to include in this. So, there’s no guarantee, actually, that if we have a 10 Brexit: What to Watch
no deal and that negotiations pick up, that they will be any easier. You would be deferring the problems, not getting rid of them completely. So, I think we might not see both sides coming back to the negotiating table quickly, and I think that those – if they do, the negotiations won’t be easy either. So, more Brexit to come, if that’s the case.
Professor Anand Menon
And of course, ultimately, I just find it inconceivable that the EU shifts its position. So, you know, politically, that’s going to be tricky. We’ve got a question, close to my heart this one, from Michael Harvey, who wants me to ask it on his behalf, about Australian terms. Is there such a thing as Australian terms? Is Government, heaven forbid, being disingenuous in describing this as Australian terms? Does anyone want to…?
Anna Isaac
I’m happy to jump in from a sheer trade perspective.
Professor Anand Menon
Yeah.
Anna Isaac
So, the World Trade Organisation, the empire of trade, the backstop for trade standards with international trading partners, is ultimately, the basis of the Australian-EU trading relationship. That’s why we’re not rolling over a deal with Australia, as a result of having had a membership with the EU, as we are with other trading partners. We’re starting a whole new FTA with them. That’s Government policy, to start a new FTA with them. So, you can’t say that there was an Australian-EU trade deal that was in any meaningful way facilitating trade on the one hand and say that we need to have a new trade deal with Australia, because there’s no trade deal to roll over on the other. There’s a fundamental disjoint there.
Another very simple point, just very quick to make, is that what is important is that each and every country around the world, pretty much, has some form of bilateral relationship with the EU that’s governed not by a big full-fat free trade agreement necessarily, but lots of little bilateral deals. There are some bilateral deals that Australia has with the EU that do ease, do reduce, some trade friction, some movement of persons, etc. So, it would – I put it in the grounds of, some orderly no-deal mechanisms is what might be meant by an Australia-style relationship. I think it would be much better to say just without a trade deal, but with some emergency provisions in place. I think that would be fairer. Or to say an orderly no deal, would be more accurate.
Professor Anand Menon
I don’t know if I’m allowed to do this, but I’m going to jump in here and do, because this gets on my nerves. I mean, as Anna says, there are agreements between Australia and the EU. There are mutual recognition agreements. There’s an agreement on wine. There’s agreement on passenger name records. So, Australia and the EU have agreements in place that will go far beyond anything we have with them in the event of no deal, and Australia, of course, is in the process of negotiating a trade deal with the European Union, because they don’t think that the current situation works for them when it comes to 11 Brexit: What to Watch
trade. It’s also worth saying, and this is a very profound point, Australia is a very long way away. Their trade is about a sixth, in terms of value with the EU of what the UK’s is. So, the notion that we should model our trading patterns with our nearest and largest trading partner, on the basis of those of a country literally on the other side of the world, is at least at the minimum, I would have thought, open to question. But I shall leave it at that before I start getting cross.
Fiona Bowler, are you able to and willing to speak? Some magic happens at this point, where you’ve empowered to speak, and it has nothing to do with me, but…
Fiona Bowler
Yeah, can you hear me?
Professor Anand Menon
Oh yeah, we can. This is fantastic.
Fiona Bowler
Okay and yeah, I suppose my question is do you think that Boris Johnson will kind of politically survive a no deal Brexit? I know, a couple of months ago, there was some talk about him becoming kind of the fall man if a deal wasn’t done. How likely do you think that is?
Professor Anand Menon
Vernon, would you like to go first on that? Can he survive a no deal politically?
Professor Vernon Bogdanor
I think the problem is this, that the vision of the Brexiteers, the leaders of the campaign, was that a minimal deal or even a no deal would be perfectly satisfactory because the vision was of a global free- trading Britain, with very few regulations, tariffs, and subsidies. Lower taxation to encourage entrepreneurs to come to London or other parts of Britain and invest and so on. And the more you move into that vision, the less you’re in need of an EU – of that close EU relationship. It’s the vision some people said of Hong Kong or Singapore. It’s more like the sort of thing that New Zealand did when we joined the EU or the EEC as it was then, in 1973. They adopted those sorts of policies under a Labour Government, interestingly. So did Australia.
But that vision, whether it was ever acceptable to the British public, and most of those who voted for Brexit voted for quite the opposite, for more social protection and not less, and whether people wanted, as it were, a fourth term of Margaret Thatcher, is very debateable. But whether they wanted it or not, COVID makes that vision quite impossible because COVID involves huge amounts of extra public expenditure, state intervention and so on, probably raising taxes rather than lowering them. And I think that is Boris Johnson’s problem, that he’s being forced to negotiate something, which instinctively and in his heart, he doesn’t really want to do. Whether he can survive a no deal, I suspect he can, because the Conservatives will say he stood up for British interests and waved the flag and so on. The real problem will come with the likely disruption that will occur of a popular reaction against it. Mind you, I think there’ll be that popular reaction, even if we get a deal, because I think much more serious is being outside the EU Customs Union and the internal market and that will be the case whether or not we get a deal on Sunday. 12 Brexit: What to Watch
Professor Anand Menon
Now, that goes back to Anna’s point, doesn’t it, I suppose? Or Georgia, I can’t remember. My old mind is going. I can’t remember who said this, but if you have a deal, you own it. If you have disruption, and it comes because you’ve signed a deal, that deal’s got your signature at the bottom, whereas you could plausibly, it was Georgia who said it, argue that no deal has President Macron’s signature at the bottom, however misleadingly.
Professor Vernon Bogdanor
Indeed, but people may not make those fine distinctions when they see disruption at the ports, when they see the price of the goods going up, when they see a border in the Irish Sea. They may not make those fine distinctions. They may say, “Look, we were promised something rather better that hasn’t actually come about.” So, I think the Government will be in considerable difficulty and in additional difficulty because all the pressures now are towards more state control, greater public expenditure. That is not what Boris originally stood for, not what the Conservatives originally stood for, not what they said would be the outcome of Brexit. So, I think there could be considerable disillusionment, but as you imply, Anand, it’s impossible to predict the future.
Georgina Wright
Can I come in there?
Professor Anand Menon
Go on, Georgie, if you want to.
Georgina Wright
Yeah, I was just going to say, I mean, for a very long time there was a sense that delivering Brexit was the only real thing that united the Conservative Party. Of course, with the pandemic, a lot of MPs’ attention has obviously not been on Brexit. In fact, the Prime Minister was also understandably distracted, and EU leaders, if you look at the other side. But, you know, we know that Brexit, as you said, deal or no deal, will cause a lot of disruption. But I think it’s pretty clear that a no deal’s likely to hit many of those new seats that the Conservatives won in the last election more than other seats. And so, the Prime Minister really has a PR campaign now on his hands, where he’s going to have to explain that disruption. He can absolutely blame the EU for it, but there will come a point where people will have lots of questions to which he will need answers to. And more than answers, he will need to be able to deliver and show that he is able to respond to that disruption quickly. And that, to my mind, is as important when we’re thinking about the survival of the government, than, you know, just what happens on the 1st of January.
Professor Anand Menon
I sense from the question box that Robert Cooper’s getting increasingly sort of frustrated and annoyed. I don’t know, Robert, whether you want to give voice to that on the microphone in the shape of a question?
13 Brexit: What to Watch
Sir Robert Cooper
And why not, if the microphone works. I was thinking, while you were talking, well, Trump lasted for four years. The pandemic may last for two or three. Brexit looks likely to last for a rather longer period and I find the way in which we’ve gone into this really pretty sloppy and off-hand. The way in which the referendum was settled to satisfy some dissidents in the Conservative Party. The way in which the referendum was conducted. Even the people who voted in the referendum. The whole thing is totally sloppy, and I would say that this represents a massive system failure, constitutional failure. So, I’m hoping that my old Politics Tutor might have something to say.
Professor Anand Menon
I’m assuming that’s you, Vernon?
Professor Vernon Bogdanor
Yes, well, I dare to disagree with Robert on the question of the referendum. It seems to me, although I was in the minority, that if the majority don’t want us to stay in the European Union, we shouldn’t be in it. But I would agree with Sir Robert to this extent, that what has happened since the referendum has been extremely sloppy. Look, we were told there would be no checks or delays on the border. That is clearly mistaken. We were told there was going to be no border on the Irish Sea. That is clearly mistaken. We were told there’d be no involvement of the EU or the European Court of Justice in our affairs. That is also mistaken in relation to Northern Ireland. And I think there’s been a sloppiness on the part of the Brexiteers to make their vision clear and to work for it. But then, even before COVID, it was going to be extremely difficult. But that was what they sold to the public. The picture of Global Britain. That was their idea. But not much has been done to put it forward, and perhaps it was oversold, so the challenges were underestimated. And that the worst thing about Politicians in a way is not that they deceived the public, but they deceived themselves as to the difficulties involved.
Professor Anand Menon
I mean, we’ve got a question from Patrick Terry, which is directed at Vernon. But Richard, I’d like you to have a go at this as well, ‘cause it’s about perceptions of the UK in the rest of the EU. And what Patrick says, Vernon, is, “Living in Germany, I can assure you that the UK isn’t seen as a bastion of liberalism, but a bastion of Trumpism. Are you failing to think through how Europeans really see us?”
Professor Vernon Bogdanor
Well, I think the Germans have a problem that the Alternative für Deutschland, which is in some respects a neo-Nazi party, is the official opposition. We don’t have any parties like that in the House of Commons. So, I don’t think we need sermons from other countries about how we are to conduct our affairs. I know I’ve been very critical of the government, but we have a very powerful liberal political culture. It’s worth remembering, in France, the alternative, if anything happens to Macron, and I pray it doesn’t, could be power for the Front Nationale for Marine Le Pen. In Sweden, a populist party has prevented a majority government from being formed. In Italy, there’s a very strong populist party in parliament. We don’t have any of that. We have a very powerful liberal political culture, and this isn’t often appreciated on the continent. I think it ought to be appreciated much more.
14 Brexit: What to Watch
Professor Anand Menon
I’m going to go to Anna in a second, then Richard. But Vernon, I just want to pick you – isn’t that what young people call whataboutery, in the sense that all that might be true, I’m not wholly convinced by all of it, but even if all of that is true, the question is, is it really the case that people see us as a bastion of liberalism at the moment, given what has happened in this country over the last four years? I mean, just in terms of people’s perception of us, do you think that’s true?
Professor Vernon Bogdanor
Well, Brexit is not inherently an illiberal project. The democratic project, if the majority of people in the country don’t want to be in the European Union. It’s true, we have had racism in Britain. It’s come mainly from people who are Remainers in the Labour Party, which has been accused by the Equality and Human Rights Commission of institutional racism in the form of antisemitism. It’s not, on the whole, the Brexiteers who’ve been the racists. It’s Remainers in the Labour Party on the left and as I say, I speak as a Remainer myself, but one has to face the facts. That’s where the racism has been, not, I think, primarily amongst the Brexiteers, though I don’t agree with them, but I think they are not, as often said, illiberal, and I don’t believe either that the UKIP Party or the Brexit Party were illiberal either. They supported positions I don’t agree with, but I don’t believe that they are illiberal or fundamentally racist.
Professor Anand Menon
Patrick has come back in the questions, Vernon and I think you could probab – I mean, you have a look for yourself, we might get back to you. But Anna wanted to come in and then I want to turn to Richard, if that’s okay?
Anna Isaac
Yeah, just really briefly to say that across European countries, across the UK, I don’t think any of us can be sort of complacent about the political status quo, given the economic realities we’re facing. And when you’re facing a catastrophic recession, as we have done this year, but we haven’t felt the impact of it yet, because we’ve had huge support for the economy so far, I don’t think across – I don’t think it’s very helpful or that useful to try and pick apart the drivers of Brexit, in a manner that doesn’t reflect the reality that we face now and look at the sort of the economic truths there.
I think it’s also fair to say that in terms of the attitudes towards immigration that might have driven some parts, but no means all, of a Brexit vote or a Remain vote, in some instances, they were completely across the political spectrum across from people who thought they might be ultraliberal to extremely socially conservative. So, I’m not sure how helpful it is to sort of see it as this country is showing these values, this country is showing these values. I think the same forces that you find behind the far right in Italy are there in UK politics. I think we have a different party-political system that might make them less apparent in some instances, but the system itself does matter. So, I think there’s just some economic nuance, some realities of cross-party thinking there that we want to be sensitive to.
Professor Anand Menon
And I do think it’s really worth emphasising the point that we’ve had the public health crisis, we haven’t even dipped our toe in the economic crisis of COVID as yet, and you know, if, as some Economists say, we end up with two and a half million people unemployed by Easter, I think the nature of politics is going to 15 Brexit: What to Watch
be very, very different as a result. But Richard, do you want to come in? I mean, this is your area, in a way, how we work with other Europeans, what they think about us. Have you noticed a shift in how people see us?
Professor Richard G Whitman
I think it’s, you know, it’s interesting that conceptions we may have of ourselves, particularly about our political system, you know, the liberal nature of British society and our politics, I mean, those simply don’t hold now, I think, as visions that are held in other capitals as to the strengths of the UK. I think that part of the sort of parliamentary theatre for Brexit actually gave the impression that, you know, sort of UK politics was dysfunctional rather than functional. But I think also the – you know, a big problem for the government has been its public diplomacy, the sort of messaging. You know, for example, the example given earlier, you know, on Australia, I mean, that’s obviously picked up in other national capitals, and governments there are as puzzled as others on the panel have been as to why that phraseology would be used. And it seemed to be frankly duplicitous or underhand to suggest that that is an alternative or that would be the alternative we put in place.
So, I think if you look at across the board, it’s not just in Europe. There is this kind of question mark that comes through in Washington and other capitals beyond Europe, as to sort of what the UK is good for, if it’s outside the EU. And by the way that the messaging on global Britain and so on tends to be more gently mocked than seized on as a sort of message that the UK is on the up and is going to have something new to offer, even if there are things going on in the background to try and strengthen bilateral relations with third countries.
Professor Anand Menon
We’ve got the same question from a couple of people. I’m going to put it to you, Georgie, if that’s alright. You can speculate to your heart’s desire. Will the UK re-join, ever, and if so when? How soon before we start discussing it, if ever?
Georgina Wright
I mean, it is the million-dollar question, but – and I’m going to avoid it by giving a very analytical answer, which is, it’s not really just a decision for the UK. If the UK wanted to re-join the EU, all other EU member states would have to agree to it, and a couple of years ago, there was a change where it would actually require not only the approval in the Council, so the grouping of the member states, and the European Parliament, but also, national parliaments to agree to it. And you can see or imagine some national parliaments perhaps not voting in favour of the UK joining the EU. So that’s number one. It’s actually quite tricky.
The second also big difference is, the treaty also requires that any new member joining, also joining the Schengen Zone and the Euro. Now you could imagine possibly the UK, with very good public diplomacy outreach and selling it as, you know, us joining would benefit the EU as whole, but we’d like to carve out being part of Schengen and the Euro. But equally, it’s quite difficult to see how the EU27 would agree to that. So, who knows? Possibly. It’s just not a very straightforward process, so I think it would be wise not to really think about that, but certainly think more constructively about what a future relationship between the EU and the UK could look like, the UK being a third country, that is.
16 Brexit: What to Watch
Professor Anand Menon
Lovely, thank you. We’ve got a very similar question from Robert Moreland and Mike Gapes. Mike, do you want to – ‘cause I’ve got your name in front of me, do you want to say what your question is? Are you okay – are you alright to speak?
Mike Gapes
Sorry, I’ve got to unmute.
Professor Anand Menon
That would be helpful, but we can hear you.
Mike Gapes
You can hear me? Oh, that’s fine, you can hear me, good. Yes, so my question is, in reality, isn’t the logic of international capital movement and integrated supply chains going to mean that any UK company or UK-based company, which wishes to sell into the European market is going to have to comply with EU standards, and – or otherwise relocate production and relocate distribution centres to an EU member state?
Professor Anand Menon
That might be you, Anna, in the first instance, I think, if that’s okay?
Anna Isaac
Yeah, so very briefly, we’ve sort of touched on or hinted at that what you’re sort of referring to, which is something akin to sort of, in fancy terms, the gravity model of trade, but this idea that, you know, if the market on your doorstep is the one that you are most attracted to as a trading partner for ease of logistics. The point about distribution centres is a bit more complicated and will depend a lot on what a final deal looks like and what the situation is with things like free ports. So, I might slightly park the distribution centre point that you made. But you are absolutely right, and there are studies that have been done across economics and trade, to show that you do tend to get pulled not only to your biggest market, but the standards of your biggest market.
So, unless there was a very, very rapid shift in UK trade, you would expect the vast majority of exporting businesses in the UK to, by and large, align themselves with European standards. Now, that could change over many years if we were, as is hoped by the Department for Trade, to join the CPTPP and to have a trade deal with the US. You could see that starting to change. And one area where you might see it change quite quickly is something like data, depending on the outcome of any deal with the EU on data. But when it comes to goods-based trade, I think your assessment is correct, that you would expect to be, companies that are looking to export to the EU to be led by their standards, and for UK policy, to an extent, to have to accept that.
17 Brexit: What to Watch
Professor Anand Menon
Richard, did you want to – oh, Richard, I missed a message from Richard saying he wanted to come in, but it turns out it was on the last question. But go on, Richard, if you want to talk about re-join, we can come back to the Brussels effect thing in a minute. Sorry.
Professor Richard G Whitman
Thank you. No, I was enjoying the Brussels effect. But on re-join, I mean, maybe the question I was going to put back to my colleagues on the panel as well is, you know, re-join is probably an unlikely proposition, but what would be teed up next for EU-UK negotiations, assuming that this deal is done, but also, how this feeds into British politics. You know, what kind of offering would Labour perhaps see itself wanting to have when it comes to policy on Europe for the next general election. I mean, I think I definitely agree with Georgie’s analysis that future re-accession is a tricky proposition, but as this deal is likely to prove a very unsatisfactory one, and in terms of perhaps what people’s expectations were as to what they were going to get with the departure from the EU, where people think the pressure might be to sort of, to upgrade, if you like, and what that would look like?
Professor Anand Menon
I mean, I have to say, just personally, I think something gets on the policy agenda when one of the big parties adopts it, and I just can’t see Labour at the moment adopting re-join as a policy, for lots of reasons. One, because they don’t want to be talking about Brexit. Two, because you run into the freedom of movement issue, and if the red wall seats really are the electoral target, I’m just not sure that’s a calculation that makes sense to them. Did anyone else want to come in on – Vernon?
Professor Vernon Bogdanor
Would we get Margaret Thatcher’s rebate if we were to re-join?
Professor Anand Menon
I’d hazard a guess that the answer to that is no.
Professor Vernon Bogdanor
Quite.
Professor Anand Menon
Did anyone else want to come in on the Brussels effect? I mean, actually, I don’t know if any of you did want to come in on that, but Robert Moreland, did you want to pose your question, because it was slightly broader than the one from Mike Gapes and it’s an interesting issue, if you want to come in, Robert, now [pause]. Well, apparently there’s a problem. I mean, Robert was just saying that, you know, that this so- called Brussels effect whereby countries neighbouring the European Union, whether they have to or not end up adopting EU regulations and standards because the market is so big. Does that mean – I suppose the bottom line here is, and Robert Cooper’s made a comment about this, I mean, is even if we end up taking back control, ultimately, isn’t life for the British economy going to be very different? So, it’s going 18 Brexit: What to Watch
to be something of a mirage, because that control is going to be not used by businesses who want to comply with the bigger market on their doorstep. Anna, you’re nodding, and muted.
Georgina Wright
Can I come in quickly on this?
Anna Isaac
Oh, Georgie’s got a point. Let her go.
Georgina Wright
Great, well, thanks, Anna. The perils of online events. I sometimes say that, like, whether we like it or not, we’re going – you know, negotiations may have ended at the end of this year, deal or no deal, but talks will continue, and even in a deal scenario. And that’s because of the Northern Ireland protocols, we know that Northern Ireland will have to abide by more EU rules and regulations than the rest of the UK. So that means if the EU updates its rulebook then, you know, certainly, it’s something the government’s going to have to pay attention to.
Secondly, it’s not just about trade, there are, like, many areas that the UK and the EU want to co-operate on. On, you know, climate change, security, and the UK’s chairing the G7 next year, some member states are part of that grouping, and the climate change and COP26. So, the UK will want to try and, if not influence EU climate rules, at least talk to the EU about them. And then, there might be areas where the UK and EU simply want to improve their trade terms. So, in a sense, businesses will have to keep an eye out, because if they export to the EU market, they will have to comply with those rules. But there are also many other reasons why the UK Government would like – should try and influence EU rules if it can.
Professor Anand Menon
Actually, on that, I don’t know, I was sort of reluctant to ask such a specific question, so I’ll ask it to all of you, so that if no-one knows then it’s no-one’s fault, but from Peter Leckie, which is, “Does mutual recognition and professional qualifications apply in the context of Northern Ireland?”
Anna Isaac
I can answer that one, if they’re not keen.
Professor Anand Menon
Brilliant.
Anna Isaac
But it will be a slightly hedged answer. At the moment, you have to think of Northern Ireland when it comes to a lot of services provisions and movement of people, in terms of the Common Travel Area, which is an agreement from the 20th Century that it has existed for a long time, predates the Good Friday Agreement and has allowed for the movement of people and for, to an extent, some recognition of professional standards to operate in those areas. It gets a bit more complicated when it touches on EU 19 Brexit: What to Watch
law, and you saw a bit of that effect where you saw a lot of Lawyers from the UK trying to cross-qualify, get recognised by the Irish Bar, so that they could continue to practice EU law. That hasn’t quite worked out, which is a complexity of its own right, but for other areas, like accounting, like things where its in the gift of an Irish professional body to recognise the qualification of a UK operator, then to an extent the answer is yes.
It gets more complicated if you’re talking about someone who is operating in Northern Ireland who might have a UK qualification, but wants to remotely serve a client in Italy and areas like that. So, it isn’t straightforward, but it is fair to say, to an extent, yes. And that kind of special treatment that Northern Ireland has, in a range of different ways, for very good reason because of the history there, but a lot of it, as it’s set out in the Command Paper is, we’ve talked about the problem of putting your name to something, the defining it. I think we are going to increasingly find Scottish politics is going to be influenced by the development of the Northern Irish Command Paper and that very much living arrangement with the Committee. Scotland is going to be looking very carefully about Northern Ireland having the best of both worlds, in some different areas, like benefitting from other UK FTAs, as well as benefitting from some tariff-free access to the EU market, irrespective of whether or not that product ends up in the South of Ireland or whether it goes on to other EU member states. So, it’s a big question you’re asking in that, in lots of different ways.
Professor Anand Menon
Brilliant, thank you. That was incredibly thorough. I really want – I mean, we’re running out of time, and not everyone’s going to get in, I’m afraid, but I really want to give Andrew Foran the chance to ask this question and to pose it particularly, I suppose, to Vernon, but to anyone else who wants to come in, if you’re there, Andrew?
Andrew Foran
Oh yes, how do you do? Yes, I’m speaking from Australia, actually. It’s well after 1 o’clock in the morning. But I’m very interested in the topic, of course. I think I’ve demonstrated that. My question was on the lines of, after 47 years of trying, has, of course, hasn’t General Charles de Gaulle’s view about Britain’s compatibility with Europe been demonstrated, over and over again?
Professor Anand Menon
Was General de Gaulle right all along, Vernon?
Professor Vernon Bogdanor
Yes, he was and contrary to what Robert Cooper said, I mean, when anyone doesn’t like the result of a referendum, it’s like when you lose a legal case, the disappointed litigant always says the Judge was unfair or the prosecuting counsel was too good, or your defence counsel was no good. But I think this is right. But where General de Gaulle was wrong is in thinking that Europe could be an entity in the world without Britain, and he did propose in 1969 a foreign policy directorate of the major powers in Europe: Britain, France, Italy and Germany, outside the EEC Framework. And that might be looked at again, ‘cause the weakness of French policy recently, and President Macron, has been to see Brexit solely in economic terms, as an advantage for French businesses and financial institutions and not in the geopolitical terms, which are fundamental for France. So, I think Macron’s policy’s not only against British interests, but against French interests. So, the Gaullist heritage is, if you like, double-edged. 20 Brexit: What to Watch
Professor Anand Menon
Would anyone else want to come in for what will be the last word now, I’m afraid, because it’s too long. Does anyone else want to comment on General de Gaulle? You surprise and disappoint me, you lot. But listen, we’ve run out of time now, I’m afraid. It’s 2 o’clock. I just want to end by thanking Anna, Georgie, Vernon and Richard. I thought that was fascinating, as everything to do with Brexit, you sort of think everything’s been said, but then you have a discussion and uncover all sorts of other interesting issues. But I thought that was utterly fascinating. We shall wait with interest to see what, if anything, happens over the weekend, and I’m sure we’ll all see each other again, trying to pick over the bones of either a deal or no deal in the not-too-distant future. But in the meantime, stay well, everyone, have a very good Christmas to those of you I’m not going to see beforehand, and I’ll look forward to seeing you all again soon. Thank you. Bye, bye.