Transcript

Webinar: Brexit Negotiations and the Coronavirus Outbreak

Rafael Behr

Political Columnist, The Guardian

John Campbell

Economics and Business Editor, BBC Northern Ireland

Claire Fox

Director, Academy of Ideas, Member of the European Parliament for North West England (2019-2020)

The Rt Hon David Lidington

Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (2018-19)

Chair: Thomas Raines

Director, Europe Programme, Chatham House

The views expressed in this document are the sole responsibility of the speaker(s) and participants, and do not necessarily reflect the view of Chatham House, its staff, associates or Council. Chatham House is independent and owes no allegiance to any government or to any political body. It does not take institutional positions on policy issues. This document is issued on the understanding that if any extract is used, the author(s)/speaker(s) and Chatham House should be credited, preferably with the date of the publication or details of the event. Where this document refers to or reports statements made by speakers at an event, every effort has been made to provide a fair representation of their views and opinions. The published text of speeches and presentations may differ from delivery. © The Royal Institute of International Affairs, 2020.

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2 Webinar: Brexit Negotiations and the Coronavirus Outbreak

Event date: 19 May 2020

3 Webinar: Brexit Negotiations and the Coronavirus Outbreak

Thomas Raines

Good morning, everybody. My name’s Tom Raines. I’m the Head of the Europe Programme here at Chatham House. Thank you all for joining us this morning. We’re here to talk about the state of Brexit negotiations amid the Coronavirus. We’ve just finished the third round of talks, which ended last week. There were lots of gloomy noises, from both sides, both from the UK’s Chief Negotiator, David Frost, and from Michel Barnier, the Commission’s Chief Negotiator. So this is a good time to take stock of where things are and to consider what the larger context of the COVID-19 outbreak means for Brexit.

We know that there are some big, outstanding issues leftover in the talks over which there’s been relatively little progress. David Frost said last week that we’ve “made very little progress towards agreement on most significant issues, and it is hard to understand why the EU insists on an ideological approach, which makes things more difficult.” Well, Barnier said that the – they’d failed to make any progress on any of the more difficult issues and was disappointed by the approach of the UK.

So, things are somewhat at a stalemate. There is a new round of negotiations in June, and there’ll be a chance to get into some of the issues that the negotiations will raise, over the course of this discussion. But we also want to put this in a larger context to think about the changing character of politics in the UK amid the COVID outbreak, what that – the implications of that might mean, and to think specifically about some of the challenges, in different parts of the United Kingdom.

There’s a great panel here that’s joined us this morning. I’m going to introduce the speakers and then we’re going to have some short introductory statements, before getting into a wider conversation. So, the first speaker I’d like to introduce is John Campbell. He’s the Economics and Business Editor of Business Northern Ireland, which – BBC Northern Ireland, forgive me, which he’s been since 2013, been very involved in covering Brexit for the BBC in Northern Ireland. Second speaker will be David Lidington. He was the MP for Aylesbury from 1992 to 2019. He had a number of ministerial roles. He was Minister for Europe, during the Coalition, and then Chancellor of the Duchy of Lancaster during Theresa May’s Premiership, so very involved with the Brexit process. Claire Fox is the Director of the Academy of Ideas, she was also an MEP from May 2019 until Brexit Day, for the North West of England, and Rafael Behr, our final speaker, is a Columnist and Leader Writer for The Guardian.

So, John, I’d love to start with you and start in Northern Ireland, where, in a way, the challenge is not just what can be negotiated, but implementing what’s already been agreed. And it’d be really good to get your perspective on the challenges facing the implementation of the protocol in Northern Ireland, but also, the larger perspectives that – and worries that businesses are facing, both coronavirus and the prospect of leaving the transition phase.

John Campbell

Hi, good morning, and thanks very much for having me here today. Just a very quick recap on the Northern Ireland protocol and how it sits in the wider negotiations. So, the protocol is part of the withdrawal agreement, so, therefore, it’s not part of the future relationship negotiation. So it is fixed there in treaty, and even if the future relationship talks fail, then the protocol still has to be implemented, although that will clearly be more difficult, if there’s a bad breakdown in the trade talks.

What that will mean is that, come the end of the transition period, Northern Ireland effectively remains in the EU’s Single Market for goods, the rest of the UK does not, and Northern Ireland, although it’s still in the UK Customs territory, has to implement UK Custom – EU Customs rules at its ports. Now, that is 4 Webinar: Brexit Negotiations and the Coronavirus Outbreak

going to involve some new checks, controls, processes, on goods moving from GB to NI. The latest line from the government is, “We’ve always been very clear there was going to be checks on food and animal products.” I think it would take a very generous reading of what the government were saying during the election campaign to say they have been clear about that.

In terms of the way the negotiation works, the EU don’t even see this as a negotiation. They say, “This was all negotiated in the withdrawal period. This is now just discussions about implementation,” but I think it’s fair to say it’s a negotiation because there’s a difference in how the protocol should actually work on the ground.

Now, the UK Government has not actually said very much about implementation, but we do know, within the last couple of weeks, a letter went from, I believe, Defra to the Commission saying, “We are going to create what are called border control posts at Northern Ireland’s ports.” These are basically the facilities through which food products must enter the Single Market, and then what we’re expecting tomorrow is a document from the government, which will lay out how they intend to implement the protocol. So, that is going to be, I think, quite a big moment in Northern Ireland, and it’s also something which the Commission have been calling for since the start of these negotiations.

Now, in terms of how Stormont actually feeds into these negotiations, we know that on the Specialised Committee, which deals with Northern Ireland only issues, you’ve Dr Andrew McCormick, who is Stormont’s Head of External Relations, he’s been a participant in that, and also, a couple of Stormont Junior Ministers were participants in the joint committee. I think, though, one of the difficulties about the Executive, about Stormont trying to influence the implementation of the protocol, is that, while they – the parties agree that there should be no ill effects on Northern Ireland from the protocol being implemented, they do not agree on the actual policy steps, which will get us there.

So, for example, on this issue of whether the EU should have a permanent technical office in Belfast, if you like, the pro-Remain parties will say, “Yeah, there’s no problem with that, just get on with it.” The Leave parties, the DUP and the Ulster Unionists say, “No, no, this is a breach of sovereignty, we can’t have it.” So, therefore, when Andrew McCormick is participating in the Specialised Committee, he does not have a Stormont position to advance on that. He cannot say, “This is what the people or the Politicians in Northern Ireland want,” because there’s frankly no agreement, beyond the very general sense that nothing bad should happen.

When it comes to the business community, I think they’re frankly aghast at the notion that this protocol is due to be operational on the 1st of January because, yes, they know in broad terms what it’s going to mean. But they don’t have yet any detail, and even if implementation had started on the ground much, much earlier in the year, it was still going to be a push. So, you know, for example, speaking to, you know, a logistics company not so long ago, they were saying to me, when it comes to the training, say, for example, what we’ll have to do on Customs – the training at the moment is all quite theoretical, “Here is a Customs declaration.” This is what you would tend to put in it. What they want is to say, “Right, give me the actual paperwork and the actual software, so I can start practising it and using it, so I’m ready and good to go at the start of the year,” but at the moment, that is not available to them.

So, the business community – and I think, just to note an aside to that, it’s not really the checks which are the most important bit. It’s all the processes upstream and downstream from the checks, the export health certificates, the Customs rebates and all the rest of it. That is the thing which is going to be really time-consuming for business. So, business has not yet got into the position corporately of calling for an 5 Webinar: Brexit Negotiations and the Coronavirus Outbreak

extension to the transition period because they don’t want to necessarily get into that political position quite yet.

All the Remain parties, so SDLP, Sinn Féin Alliance, have said there should be an extension. The Unionist parties have not really been very vocal on that one way or another. Frankly, I don’t think they would lose very much sleep if there was an extension to the transition period. But I think it’s pretty clear, when you talk to businesses in Northern Ireland, they are going to need something beyond transition, whatever you want to call it, to actually make sure that the systems, which they are going to have to work with, are there and are functional.

And then, this is one other big open question, which you might want to come back to is, let’s say the future relationships talks fail, they fall apart, there’ll be – the protocol still has to be implemented. What is that actually going to look like in practice, and is there any risk that the UK Government will say, “We know what we agreed, but we are not co-operating with implementing the protocol at this time?”

Thomas Raines

John, thanks very much, you raised a lot of important issues there and made clear what a massive challenge the implementation is for business, the degree of, sort of, potential friction for trade between GB and NI and some of the difficulties of preparation, and also this question of extension would I – which I would like to come back to later on. David Lidington, perhaps I could turn to you now. You were obviously very closely involved with the negotiations on Ireland in – and Northern Ireland in the first phase of the negotiation of the withdrawal agreement, but I wonder if – I mean, please make any comments you’d like on Northern Ireland, but we’d be fascinated to have your view on how you think the government is approaching the negotiations at this point. We know that there are a lot of issues, which have been difficult to make progress on around particularly the level playing field, but also, the governance of the future arrangement, issues like fisheries, where there’s obviously a very big gap between the positions of both sides. How much of what the government is doing is tactical, how much is, sort of, ideological, and what space do you think there is for potential compromise?

The Rt Hon David Lidington

Thanks, Tom, and I agree very much with what John Campbell just said in his analysis of the Northern Ireland situation. The one thing I would add is that if you’re talking about a practical implementation of the protocol, it’s not just, you know, important though this is, how Northern Ireland departments and Northern Ireland businesses need time to put arrangements in place on the ground, but you’re – things like customs, you’re relying on HMRC to have all sorts of systems in place, people deployed to do certain things. And, you know, my – one of my reasons why I’m, sort of, pretty dubious about how practical it is to have everything ready by the end of this year is simply that these are hard enough challenges at the best of times, when COVID has inevitably, rightly, diverted huge amounts of ministerial, senior official, operational official time and attention and energy away to dealing with the pandemic, you know, a bit more time, I think, is going to be necessary.

Now, having said that, my strong wish and hope is for as much progress to be made as humanly possible on actually getting a deal because I think that it is thoroughly unhealthy for the future strategic relationship between the United Kingdom and the countries of the European Union, our fellow democracies, friends and neighbours, for this all to be hanging unresolved for any longer than necessary, and it was a British domestic political development that we need to move on from 2016 and really, on both sides, stop trying to refight a battle that was settled in 2016, and if not then, then at the of January 6 Webinar: Brexit Negotiations and the Coronavirus Outbreak

this year. You know, we have left, this is now a negotiation between a third country and the countries of the European Union, with the Commission acting for them.

Where I think I am is that I think the government is acting largely – it’s the element of ideology, but it’s – and there’s no doubt the arguments about sovereignty matter a great deal to this government and to particular members of the Cabinet especially. But also, I think they have – their reading of the past is that previous governments, both David Cameron’s and Theresa May’s, could have acted much more toughly, in terms of negotiations, and the EU only concedes at the last minute, so you’ve got to hang in tough there, be prepared to walk away and eventually people will come to terms.

So, whether I disagree with that now is a bit immaterial, but I think that is the mindset of the government. Having said that, I’m not one of those who’s sunk in doom and gloom about the prospect. As John Campbell just said, you know, the government has started to send signals on the implementation of the Northern Ireland protocol, that it is going to keep its word, what it signed up to last year, and I think that will be read encouragingly at the Brussels end of the dialogue. And I think, you know, there’s interesting ideas floating around for people like my former government colleague, Raoul Ruparel, who was the Advisor on Europe to Theresa May, about perhaps, if not an extension to the negotiating period, then an implementation period, so you’d get an outline deal before the end of the year and then you would have time for those practical measures to be put in place by the various authorities in this country and around Europe for the future.

Don’t forget, when it comes to politics, there are devolved elections next spring, and the Prime Minister will not want to be taking unnecessary risks as far as Scotland and the SNP is concerned. I think the government is very alive to the pressures that the unity of the United Kingdom is under at the moment and the willingness of the SNP to grab any opportunity to add to their narrative of Scotland being overridden and ignored. The fact that two home nations voted to leave, two voted to remain has made this an inherently difficult issue and sensitive issue to handle, in UK union terms, ever since 2016, and that’s even more the case with an election coming up next year.

Big issue is fish. Fish is utterly insignificant economically, if you look at it across the UK economy as a whole, and particularly in communities obviously it’s different, or the EU economy, but it is of huge political significance and resonance in the UK, including particularly the North East of Scotland, but also in Denmark, in the Netherlands, in Spain and in France, so other countries have their politics as well. I think that level playing field is clearly important and that ties into the difference between the UK wanting a Swiss-style series of different, self-standing, bilateral deals with the EU on different topics, and the EU wanting to have a single association agreement with the UK, with the various topics, in different strands of that agreement, and therefore, it’d be easier, from an EU point of view, to say the breach of any one of those elements leads to the collapse of those things that might be advantageous to the United Kingdom, so I think there’s a clear difference there.

I think it’s important that those of us, like me, who were strongly on the Remain side in 2016 don’t get all starry-eyed about the EU’s position. There’s a lot of, you know, sort of, ex-Remainer commentary I read that is just very critical of the UK Government and I’m, you know – you’re perfectly entitled to be critical of the UK Government, but actually, the EU is not being reasonable in saying that, for all time, the fisheries regime should be maintained with exactly the same access rights as when we were a member state.

And, similarly, I think that when it comes to Single Market rules, no, you’ve got to have everything. Well, actually, well, I think British manufacturers ain’t going to shift from following EU rules for the future. I’s 7 Webinar: Brexit Negotiations and the Coronavirus Outbreak

not in their interest to do so. Services is a very different matter, and I remember, you know, when we were a member state, we had to argue and get special rules for our financial services simply because it was so important to our economy. It was a vital national interest and the others recognised that, and if we’re outside, we don’t have a vote, actually, I’m not in favour of us automatically signing up to every rule that comes out of the EU Single Market, particularly on services, when it might move in ways that are inimical to our national and strategic interests.

I think the EU is also being unreasonable on Justice and Home Affairs staff. We all have a common interest amongst the European democracies in uniting, sharing information about terrorism, against serious and organised crime, and it seems to me that, and we found this in the negotiations under Theresa, that there is a theological approach in the Commission that is looking at, first, at, right, whether we can make a difference, a distinction, between members and non-members, rather than saying, “Right, what do we need for the safety of our citizens?” And we know that, whether it’s terrorist outrages here or France or Belgium or Germany, terrorists have operated across borders, and actually, for police and immigration services to be able to share information on suspects and data is something really important to get to grips with that transnational challenge.

And I think – this is my final point, is that what I’d like both sides to do is be a bit more geostrategic about all of this. If we try to lift our eyes beyond the immediate negotiations over the next three, six, 12 months, however long it takes, we’re going to be living next door to each other. We are democracies that are under pressure from Russia, from China, in different ways, the United States that is questioning, its identification of its own interests with the security interests of Europe, with common problems from co- operation against COVID and other viruses, to co-operation against terrorism and organised crime, to co- operation to manage the migratory pressures from Africa that are going to continue for many, many years to come, climate change. So, we need to find ways in which to work well together, and a – an amicable divorce, leading to a new partnership that will be then developed further as the EU changes and we change over the next 10/20 years, that’s a good way forward. An embittered divorce that leads to slinging rocks at each other will only delight those who wish European democracy, you know, human rights and the rule of law ill.

Thomas Raines

David, thank you very much. Some really important points there on the detail and differences within the negotiations of the government’s approach and a plea to think about the long-term, which would be interesting to come back to in the questions. Claire, could I turn to you now? You represented the Brexit party in the European Parliament, and it would be fascinating to hear your views on what the expectations now are amongst Leave supporters.

Claire Fox

Thank you very much. Great to be here, Tom, and hello, everyone. Yes, thinking about how Leave supporters view the present time, and I apologise to any Leave supporters for speaking on your behalf because it’s not like we’re a monolithic block, but, nonetheless, I’ll carry on, rather arrogantly, speaking on behalf of us all.

I would say that Leave supporters, first of all, have taken some gratification at the tone of the UK’s side of the negotiation, and this is quite important. People have been pleased by David Frost, that he’s stood firm, that he’s refused to rollover to the EU demands, something that they felt was happening before. The statements, and things like, were clearly, you know, that we’re outside of the club, that we won’t be bound 8 Webinar: Brexit Negotiations and the Coronavirus Outbreak

by EU rules. These are, kind of, ways of communicating that indicate to Leavers that something has changed. That we’re not simply trying to force ourselves into a half-hearted leaving, and, while a lot of us had reservations about the withdrawal agreement and still do, that at least that tone feels more definitive than ever before.

But I wanted to talk about the new context in which this debate is taking place, which is COVID, of course, because, over the last – and since the COVID crisis has started really, there’s been a lot of people saying, “Ah, now we have the COVID crisis,” you know, “there’s no way that we can leave, according to this timetable,” you know, “there has to be a delay.” It’s posed very much as a practical response this is an unprecedented situation, everyone needs to focus their energies on COVID. I think David has said, you know, there’s maybe not enough bandwidth to thrash out the deal in these circumstances.

But I wanted to indicate to you that, rather than Leavers seeing this as a good faith pragmatism, it feels as though it’s been embraced rather too readily by those people who fought so hard to thwart Brexit, and that demanding a delay feels like an opportunistic and an often foolish use of the health crisis. You know, so I don’t know how this has happened, but I am signed up to the European Movement’s newsletter, so they keep contacting me and telling me what a wonderful opportunity it is. Stephen Dorrell, you know, “We cannot afford to have two crises at once. This is our opportunity to make the point that this is not in the national interest.” Lord Heseltine warning that what – how threatening a no-deal is, how we’ve got to get out of this, how a delay is the only way possible.

And there’s a constant diet of anti-Brexit digs from some of what I would call the usual suspects in the Remain camp, even arguing things like no-deal Brexit preparations are the reason why there was no pandemic planning, that the – that Brexit itself will leave the UK exposed to future pandemics, that Brexit will deprive us of the NHS and care homeworkers and so on. This is, kind of, constantly all over the media or all over social media. So, for leavers, there’s a certain cynicism that COVID is being used to argue for delay, and I suppose the best way to explain the way people now understand it and it’s clearly focused in their mind is that a Brexit delayed is a Brexit denied.

So, the delay has become, and is becoming, a – very much a politicised issue, and I don’t think that was started by leavers, but actually started by those who have been anti-Brexit using the COVID crisis in a particular way. And if, anything, COVID has reinforced why Brexit was the right decision in the first place and why a delay would be especially damaging at the moment. So, for example, the crisis has demonstrated, more than ever before in a way, the need for nation states to have control over their borders, control over key aspects of their economic lives, so an overreliance on just – for example, global just in time supply chains and on inputs has exacerbated problems within nation states, and then, of course, there’s the unprecedented economic challenges facing every nation state, facing the UK.

And so, in some ways, one of the things that’s happened is that the, kind of, project fear projections of economic Armageddon that people were talking about in relation to a frightening prospect of no-deal Brexit before January just doesn’t bite home in the same way because here we are, in the midst of a real- life economic devastation facing us, and I think therefore, no-deal just doesn’t feel, you know, as scary. So, when David Frost calmly notes that, “In the absence of a trade deal by the end of the year, trading under WTO terms with the EU will be the most attractive and the least costly option,” it just sounds sensible and calm and makes sense, as an option, not that anyone’s aiming for that.

What’s more, I think, any delay would be ruinously expensive with the UK potentially paying billions into the EU budget for no reason. But the key issue is now, the new key – as the UK needs to turbocharge the productive economy, in order to survive this COVID crisis, it will need to be bold and ambitious and truly 9 Webinar: Brexit Negotiations and the Coronavirus Outbreak

international, and so the last thing it needs to have is to negotiate around EU rules and regulations and restrictions, in terms of things like state aid and regional support and so on. And there’s obviously we don’t want to sabotage any possibility of trade negotiations with countries outside the EU, so, in many ways, it clearly is in our interest to leave as agreed, and not to extend.

I think that what the UK needs is the maximum flexibility to operate as a free sovereign state, and I think to – throughout the negotiations, it’s been clear that Barnier and the EU side have just refused to accept that reality, that the UK is a nation state operating independently. The irony here, of course, is that most of the measures taken by member states to do with COVID-19 have actually broken and flouted all of the rules set down by the EU, and yet, still the EU has launched legal proceedings against Brexit Britain for a failure to comply with its freedom of movement directives, it just feels like, you know, tone-deaf and no self-awareness, completely ironic, when freedom of movement is hardly an issue in a situation where every EU country has closed its borders.

And, so, more broadly and to finish, you know, why should the UK want to be stuck back into the EU, even for a short time, at this very time? I think COVID has exposed it as a union in name only. It’s riven with divisions between the richer northern states and the poorer southern states. Despite the newly announced €500 billion post-COVID reconstruction fund, which Merkel described as a “colossal act of solidarity,” actually, solidarity has been rather thin on the ground, and that solidarity fund has only emerged after Macron warned that COVID-19 was “a moment of truth for the EU, in which it could unravel the whole union.”

So, I think that you can’t say that this is a stable union, and if you look at the bitterness of, for example, the Italians, that at this moment of crisis they felt abandoned. That 67% of Italians now consider being part of the EU a disadvantage, of some of my mates who are Italian who have absolutely been hostile to my Brexit stance now telling me that I was right and that I made the right call and they want to get out of the EU. Yanis Varoufakis has conceded, and is somebody I’ve argued with about Brexit endlessly, he’s argued that “The British did the right thing in voting for Brexit,” and he says, “I don’t think the EU is capable of doing anything other than harm.” There’s a – there’s – this is a toxic mix that the EU’s going to have to sort out with.

So I think that the – this is just summed up, and final statement really, by the German – the very public row between Germany’s federation – Federal Constitutional Court and the ECJ, and I think that has revealed not only just the reluctance by the Bundesbank to bail out the European Central Bank, but that member states’ national sovereignty is at odds with EU membership, which everyone has always denied when I was an MEP. But, actually, the EU itself has made it very clear that the EU takes primacy. Ursula von der Leyen says, “The final word on EU law is always spoken in Luxembourg, nowhere else.” That’s fine, but then why would the UK, which voted to leave democratically, in a huge show of democratic involvement, why then would the UK shackle itself further to the ECJ and anything to do with the EU when basically, it is an affront to democratic accountability and national sovereignty?

Thomas Raines

Thank you, Claire, and there’s some interesting points about the perception of the extension amongst leavers and the way that, in a way, it’s, sort of, become politicised and fallen into the existing Brexit Remain and Leave divide, and some wider comments on how the EU has responded to the crisis and how that looks from the UK side. 10 Webinar: Brexit Negotiations and the Coronavirus Outbreak

Rafael, perhaps I could come to you now. It would be fascinating to hear your perspective on, sort of, the wider context for these Brexit negotiations now. Obviously, we’re going through this extraordinary political health and economic challenge of COVID, which has been a massive test for this government, which was relatively newly elected only months before this with a very large majority and now faces a different opposition leader. Are we operating in a new political context now or are there going to be lasting ramifications that affect Brexit or that will – or that Brexit will be changed by the COVID context?

Rafael Behr

The short answer is yes. I mean, a lot of what I wanted to say has been covered already and I’m sure you’re keen to get onto the Q&A, so I’ll try and be really brisk. I mean, the essential thing, the change of context before we get to COVID, is the 80 seat Tory majority that was won, I think David’s absolutely right, the Remain campaign was destroyed, really, as an institutional force. Now, I understand that there’s this, sort of, spectral idea of Remain that still haunts the Leave imagination, and I’m sure there are people in the European Movement who are – you know, and others who are, sort of, performing the role of the, sort of, soldiers in the jungle, who refuse to come out and surrender. But as an institutional force in British politics, there is no meaningful Remain campaign, and we are a third country, and particularly in terms of the public presentation of that, I mean, again, on Twitter, you know, the cultural war still rages, but I think, for the overwhelming majority of people, and that definitely includes Leave voters, we’ve left the EU, Brexit is done.

Now, people might want to try and mobilise that, and again, as part of a, kind of, ongoing cultural war, but I don’t think actually, the question of whether or not we should leave the European Union is meaningful now because we have. And this is particularly important, in terms of the new Labour leadership, I mean, Keir Starmer was – he’s a, you know, liberal-minded Lawyer from Islington who was the most prominent Remain figure in Jeremy Corbyn’s Cabinet, and he has to essentially scrub that stain from his political brand as part of the rehabilitation of the Labour Party in seats that they lost and that they cannot govern, without winning back at some point.

So, it’s just – it’s simply not in Keir Starmer’s interest to position himself as some kind of continuity Remain figure, and he’s not going to do that. Also, on top of that, I’d add there is still a very salient argument within the Labour Party and even among people advising Keir Starmer, and I haven’t had a conversation with him about it personally, but that what we used to call the Lexit position, the left Brexit position, that argues that there is an opportunity outside the EU, in terms of all these things like state aid, competition law, where you could actually take policy in a more socialist direction, in such as wasn’t permitted by the, sort of, more market-oriented pan-European Single Market approach.

So, don’t expect Labour to become any kind of continuing Remain figure party force in this, which means actually, much more interesting is, I think, now divisions that were always inherent in the idea of Brexit, but that become more salient when you’re really trying to implement it as policy. There was always a slight tension, crudely you could call it, between the, kind of, Vote Leave, Liberal, free trading idea of what Brexit was, and the more, kind of, Leave.eu, which was the, sort of, Faragist, strains of nationalist, sort of, Donald Trump, fellow travelling, as it were, idea of what Brexit should be.

Those are really quite different concepts of the role that the UK has in the world, in various different ways, not least because they, as David sort of alluded to, they really describe different ideas of Brexit in a geostrategic context, which – and by that I mean there was always an element, in the Brexit movement, of hoping that the European project itself would completely unravel. That it was so intrinsically hostile to 11 Webinar: Brexit Negotiations and the Coronavirus Outbreak

the national sovereignty, not just in the UK but everywhere, and that it was a, sort of, a wicked imperium, and that Brexit would be the thing that tugged on the thread and the whole thing would unravel.

And now that’s very different from the traditional foreign policy of orthodoxy of the UK, which has always been about a bridge between Washington and Continental Europe and seeing the European Union as part of the international western liberal architecture. You know, essentially, sort of a cousin of Bretton Woods Institutions and a partner of the, sort of, stable, global world order, and anyone who’s actually sat in Number 10, or really had any serious ministerial responsibility, very quickly understands the importance of that second concept, and distances themselves quite quickly from the, sort of, burn everything down and from the ashes a phoenix of some new world order will emerge, radical concept.

And the interesting thing I would say, I mean, Boris Johnson, very cleverly because he’s a brilliant Politician in many ways, and he has flaws obviously, but he’s done very well at, sort of, dipping into the rhetorical well of the, sort of, radical revolutionary Brexit bolshevism that just wants to burn everything down or gets some thrills at the sound of breaking glass, while also, I think, actually being quite classically Conservative in many respects. He wants to be Prime Minister. He doesn’t want to be the Prime Minister who oversaw the unravelling of – or helped contribute to the unravelling of the western liberal world order, and therefore, there is a tension with him – within him, I think, between what is required for a responsible Prime Minister and where he has drawn the energy for his political project from.

That is also, I’d say, reflected slightly in differences between – and within his voting coalition, so you have the seats that he won, he wouldn’t be in power without these what we call the red wall, former Labour strongholds, where he won, and the, sort of, ideological – classically Tory, ideological, Euroscepticism, which actually comes from a pre-red wall Conservative Party. And so, I mean, bluntly speaking, you know, the Leave voter in Bolsover doesn’t have a huge amount in common with Daniel Hannan or Sir Edward Leigh, except for their hatred of the European Union or their desire to leave the European Union, which is now done.

And, actually, the politics and economics of moving forward with that coalition is actually quite difficult, which I’ll finish in a second, but we get to COVID. Now, crucially, I mean, it’s one of these things where you can just – people will draw the facts and fasten them into evidence to support whatever they felt before, and we heard that very effectively. I mean, you know, David, I think, put forward the view of why you would want a transition, which is about administrative capacity, you know, want to – you’ve seen the value of international supply chains, you know, there’s all sorts of things, reasons why you might not want to burden a very hard Brexit on business at the end of this year. Claire put forward the opposite view, you know, which is that you need to just – we’re starting with a tabula rasa, you know, the house has burnt to the ground anyway, you know, let’s just build this new, sovereign Britain, and more efficiently, without necessarily being attached to the European projects. I mean, I have my own views on that, but either way, you can configure the crisis as either a reason to be a bit more careful or as the opportunity to rush ahead further.

I think, in terms – and, again, I think, crucially, Boris Johnson will be able to see both of those things, and will believe both of those things simultaneously, and therefore, I just want to finish with, sort of, three things that will affect his decision, because it will ultimately be his decision, an 80 seat majority, he has all the principal capital he needs to do more or less whatever he wants, even if his handling of the COVID crisis has just damaged the brand a bit, he’s still enormously powerful for a UK Prime Minister.

So, Scotland absolutely, as they’ve said, that will be crucial. He doesn’t want to be the last Prime Minister of the United Kingdom. What the economy does in those red wall seats, so will he actually, in 12 Webinar: Brexit Negotiations and the Coronavirus Outbreak

consultation with Rishi Sunak, think, “The kind of Brexit that I want to do, or even if we can’t get a deal, crashing out quite hard in December, will do things to those voters who are Boris voters more than they’re Conservative voters, that means they won’t stay with me,” and if he’s worried about that, he’ll want a delay, a little bit, or have more time. And then the last one, obviously as the US Presidential election, a Trump second term, in terms of what that means for that liberal western world order is so different from what it would mean if you’ve got a Biden Presidency, that the frame in which the UK is orienting itself in that changed world, will trickle straight back into the Brexit negotiations.

Thomas Raines

Raf, great points, thank you very much. There’s lots in there, and I’d like to encourage everyone who’s watching to keep sending in your questions. I’m going to turn to some of those now. You can do it via the ‘Q&A’ function, and you can also ‘like’ other people’s questions’ if you particularly want them to be answered. I want to start, and going back to this issue around the decision to extend, it’s one of the top questions that’s been asked here from John P. “Opponents of extension say we should pay huge sums in budget contributions and maybe even towards eurozone bailouts.” That is one of the issues and challenges that come out of a decision to extend, that the UK would have to come to some kind of budget settlement, in order to remain a member of the Single Market in the transition phase. David, do you think that that would be a large obstacle? Do you think there’s the – you know, how do you think the EU would respond to a request from the UK, if it came in June and said, “Look, we need more time because of COVID, can we extend?” you know, perhaps with some clever legal mechanism that it’s conditional or that it can be – you know, if an agreement is reached earlier, that the transition – the extended transition would come to an earlier end than the withdrawal agreement proposes?

The Rt Hon David Lidington

I think the key point is that for around European capitals, Brexit is seen as, at best, a second order issue at the moment. It’s something that, in principle, was done at the end of the January, they want this sorted, but frankly, apart from COVID, they have got their own, sort of, EU recovery plan, and we’ve had the Macron-Merkel announcement in the last 24 hours on that. Those are the things that are occupying their time and attention. Even I remember when I was in government, you know, going to Paris and Berlin and other capitals and people saying, “You do realise that Brexit is slipping down the list of priorities for all of us? You had your decision at the referendum. Frankly, we’ve got other things that we need to be focusing on. We’ve got an EU to think about after you’ve gone.”

So, I think they would be pretty relaxed about it. They would want to, I believe, have a sense that we knew what the extra time was to be used for. So, I think that the – it is still important that the negotiators press on as hard as they possibly can this year. The key ingredient that has been missing up to now, that needs to be built, is mutual trust. Ad while David Frost is a very able official, he is an official, and ultimately, it’s between top Politicians that you need to have what I’d describe as a speculative conversation, where one person can say, “Look, off the record, if I was to make this move, could you respond by conceding X to me?”

And, you know, Boris Johnson can sit down with, sort of, von der Leyen or with Angela Merkel or with Emmanuel Macron, and have those discussions, and, you know, at the moment, none of those leaders has time to do it. So those discussions are going to have to take place at some time, if there’s going to be a sensible deal of any kind. The money, I mean, under the withdrawal agreement, that has to have UK agreement. So ultimately, even if we were to decide, or the EU were to decide, or mutually, we want to be able to extend this by, you know, three months, six months, 12 months, whatever, then the financial 13 Webinar: Brexit Negotiations and the Coronavirus Outbreak

arrangements would need mutual agreement and either side could walk away if they – at that point, were the financial arrangements not what they wanted.

I don’t myself see that that is insuperable. I think that, basically, people would just roll forward something a bit like current arrangements, perhaps, on a, sort of, 12 monthly instalments basis, depending on how many months we were talking about. I mean, there’ll be difficult issues still, you know, what happens with the fisheries’ negotiations in December? And clearly, there would be – if you were extending for a few months, you’d need to have a system whereby, you know, the UK quotas were not diminished by decisions that were taken by the EU, without us being at the table, but that was what was done in the Tory groups.

I don’t think it’s impossible, and, you know, the British bringing in polls, for what they’re worth, is showing, you know, 60% to serve the public, saying that, yeah, obviously, because of COVID, this is something they’d put up with. Now, don’t get me wrong, my strong preference would be, get the deal done. That is by far the best outcome, but I just think that, with everything else that’s going on, it is looking evidently very difficult to get all the practical arrangements in place.

Thomas Raines

Thanks, David, and, John, just on this question around – well, I suppose it’s sort of related to the first question we have here, which is about “What will be the economic benefits of pursuing the current Brexit timeline, given we know the transition period is going to lead to some kind of economic disruption for business, and, you know, how big that will be will depend on what the final agreement looks like.” Do you get a sense from businesses that they – you know, to what extent do they view a balance between certainty versus having a – you know, less friction in trade? You know, would be advantageous for some businesses to know from June that we were definitely leaving, you know, at the end of December? Would it be beneficial for them to know if there was to be no deal, that they would have then, you know, six months of effective preparation time for that outcome?

John Campbell

It’s almost like the Hobson’s choice, you know, really. You know, if you were to say to people today there’s not going to be a deal, the issue is, you still need to know what the protocol looks like, in terms of it being operational. So no deal would still mean the protocol is there, but it creates what you might call a much thicker Irish Sea border, ‘cause let’s say you were to get a deal where you’d quickly get, say, a New Zealand style SPS agreement, which means that only 1% of consignments need to be checked. With no deal, you could potentially be talking about almost every supermarket lorry that’s rolling off a ferry needs to have the back opened, looked at, all the documents gone through. But the general processes and how that work will need to be the same, and the issue is that we don’t have any of that yet. So, perhaps we will start to get some of it tomorrow, although whatever’s proposed tomorrow needs to be put to the EU. So, I don’t think that to tell people they’re definitely – you know, come the end of June, there’s definitely not going to be a deal, would be that helpful until you actually have all the processes for what the operation of the protocol looks like.

Thomas Raines

That makes sense, and there’s just one very quick question I’m going to put to you now, which is here, which I think there is two parts to, “But will Brexit leave the border between the Republic of Ireland and 14 Webinar: Brexit Negotiations and the Coronavirus Outbreak

Northern Ireland absolutely unchanged, as Johnson had previously stated under the current arrangements?”

John Campbell

It should do. But I think the only potential risk to the hardening of the border is, as I alluded to earlier, is what happens if, come a big breakdown, the UK Government says, “We’re not going to co-operate on the implementation of the protocol”? Because like any border, and there will be this new border in the Irish Sea, there’s two sides to it. So, the two parties need to co-operate. So, the risk for the Irish border is if the UK Government says, “Our officials aren’t going to do anything at Larne and Belfast. How you look after the integrity of the Single Market is your business.” And then that potentially brings us back to all those hard border arguments about, can you do checks away from the border or would there have to be new border control posts at the border? Does Ireland become a, kind of, second class member of the Single Market? Now, I still think it is unlikely that that’s the position we will end up with. You know, it would be such an aggressive thing to do, and if you have spent quite a lot of time recently talking about the need to protect the integrity of the Good Friday Agreement, to do something like that would just seem incredibly reckless. So, that to me is the only scenario in which you get back into your hard border discussions, but, in practical terms, I do not see the government going there.

Thomas Raines

Okay, thanks very much. Claire, there’s a question here from Raoli Sword, which is on perceptions within the Brexit camp, and you mentioned this issue of the, sort of, perception of Brexit delayed as Brexit denied. You know, to what extent do you think, you know, there is the possibility for the right person, maybe it’s Johnson or somebody who’s been a Brexit supporter from the outset, to, in effect, sell a Brexit delay, if they thought that that was what was needed, given how much disruption of other aspects of the economy, of everyday life that there’s been around COVID, would it not be – you know, if David Frost and Boris Johnson and others came out and said, you know, “We believe we need a little bit more time, in order to make progress and we’ve paused everything else.” Could – would they be able to convince the, sort of, supporters you were talking about, do you think?

Claire Fox

First of all, it’s not just a perception. I was explaining how that perception had come to the fore, but I actually believe it as well. I mean, I do think there is a danger to the whole project if you deny – delay, and the point that you’re saying is, you know, well, isn’t it more difficult now because of COVID and so on? I mean, first of all, David Frost hasn’t said that. They’re saying they’re getting on. The EU are being intransigent. David Lidington, who probably he and I wouldn’t agree on anything, has conceded that the EU are hardly playing ball, as it were, and so you have to say this is the deal, we’ve got other things to think about.

I mean, David’s right that, you know, Brexit isn’t also the only thing that everyone should be thinking about, it’s rebuilding Brexit Britain in the context of COVID. The last thing you want is to be negotiating with the EU behaving as though we haven’t left. So, what you need to do is to leave, and hopefully, with a deal, and if without a deal, then we leave and get on with it ‘cause we’ve got a lot else on our plate. So, I think of it that way because I was thinking about some of the things that Raf was saying, you know, the kind of – the sense of, you know, some people want to burn the house down, you know, crashing out, these are, of course, very emotive, sort of sense, you know, that this idea that they’re, kind of, revolutionary, Bolshevik, Brexiteers who are just trying to, you know, tear everything up and start again. I 15 Webinar: Brexit Negotiations and the Coronavirus Outbreak

mean, I don’t think that’s the way it is. I’m much more positive about the fact that people took a decision and wanted to see some very positive things happen, and if you worry – you know, you think about that red wall, a Bolsover man, whether he gets on with Dan Hannan or not, I mean, they are capable of understanding each other and they might actually agree on a few things because they do actually have something in common in relation to sovereignty and democracy.

But I think that what all of those people now are facing is an extraordinary economic challenge post- COVID, post our response to COVID by the way, the lockdown and the continued lockdown, and that’s going to require a burst of energy and, you know, economic imagination and passion and commitment that I think would – we need to get on with, right? And all of us need to get on with that, and therefore, I object to this idea that, you know, COVID’s stopping the Brexit negotiations. Whereas, in fact, what we should be doing is just saying, “We’re going to deal with this because we’ve got a bigger job on our hands.”

I also think, by the way, that the nationalism caricature is not right. I was making the point, and I think this is an important point, is every time I talk to leaders, one of the things they most object to is being called nationalists or, kind of, going inwards and not being outwards. Most of them see themselves as pro-Europe, you know, have an international view, and if you want, I would – you would want to give solidarity to people in Europe who are suffering as a consequence of COVID. Well, that would be a democratic decision, but what you don’t want is to be forced economically to have to join in a bailout. In other words, it’s not about saying, “We don’t care what happens to the people of Greece or Italy or people who’ve suffered.” It’s about us making that decision.

I think that’s important because, actually, it was the EU bureaucracy that abandoned its own member states in the midst of the worst, most terrible crisis, which is why I gave the example of the bitterness in Italy, over the last couple of months. You can’t underestimate the existential crisis this has brought to the EU, and that’s not because I want to see everything down in flames, but it’s to note that even the most pro-EU commentators have said, “My God, the EU haven’t handled this very well.” And if you can’t be honest about that, then how can I trust people to negotiate on behalf of moving forwards, if people are still trying to rewrite the EU’s role in what’s happened in relation to COVID?

Thomas Raines

Thanks, Claire. I – Raf, I’d like to bring you in now, and Polly, I don’t know if you have a particular response to those, but there is a question here from John Gillani, which is about the degree to which you think that there might be flexibility from the EU side, given that there’s – you know, there isn’t common ground, and to what extent does that, sort of, reflect the fundamental differences and different legal approaches of the different sides? Can you see much space for flexibility in how the EU side will approach these negotiations or will – you know, where does the balance of flexibility to reach a compromise have to come from?

Rafael Behr

I think there will be an understanding, increasingly, as time goes on, that – well, I think – actually, first of all, I think there is already an understanding that the final Brexit outcome is not going to be anything like the one that, 18 months ago, the EU thought the UK might land itself in. So, I mean, it’s very important again, in taking what Claire just said, that there is really no doubt at all that when the – that the UK is going to end up outside the Single Market, outside the Customs Union, either in – with a, sort of, landing on gravel or landing on smooth tarmac, it doesn’t really matter in the, sort of, long-term. 16 Webinar: Brexit Negotiations and the Coronavirus Outbreak

John Campbell

Great Britain.

Rafael Behr

It’s going to be – thank you, that it’s going to be a very different, economic relationship, and therefore, strategic and diplomatic relationship, and therefore, almost certainly, at the – these questions, they’re really, really difficult questions from the EU side, which are CJEU jurisdiction and alignment, you’re going to have to find some kind of fudge that says – that recognises that the UK cannot simply take CJEU rulings onto its statute book directly. That’s not going to happen because the UK won’t tolerate that and therefore, whether or not that means you can, sort of, launder CJEU decisions in such a way that it becomes a sort of a sovereign decision that the UK made, for practical reasons, in recognising that all its businesses basically want to, you know, want to be aligned with EU regulations over the time. Some kind of compromise like that can probably be found, and, likewise, on – I think on the state aid, the COVID thing changes the context so much, in terms of what, in the EU member states, the pressures are in terms of supporting industry and an economic reconstruction, that there is surely some new frame for the conversation that talks about how this happens in the future.

But it is – you know, and I do understand – well, I sort of understand where Claire’s coming from, in terms of thinking that somehow a Brexit delayed is a Brexit denied, but the UK is a third country. There is no denial of Brexit. Brexit’s happened legally, in the most fundamental way, and therefore, ultimately, the more you want to compromise and come up with some arrangement that allows those people in the EU who are going to understand UK, big country on our border, has a lot to offer, in terms of security co- operation, still a serious market, you know, the non-fishery countries, who might think, “Why are we getting so hung up on” – it is basically French fishermen dictating a really extreme position that makes it very hard for us to compromise. All that stuff can, sort of, be worked through. It is genuinely hard to do that between now and, realistically, they’re talking about October/November, if you want to get the ratification done. So, I honestly think it’s quite important, if you want the EU to compromise, it actually makes more sense to have a little bit more time, so that those diplomatic processes, when we’re out of a, kind of, global lock – when you’re not having to negotiate like this, through Zoom, which is really hard, you do just need a bit more time, but I don’t think it’s beyond the realm of imagination.

Thomas Raines

That’s great, Raf, thanks very much. We are coming up towards the end of time – not the end of time, the end of time for – although Brexit and COVID can make you feel like that, but the end of our discussion this morning. I want to try and sneak in one final question. It relates to some of the issues that Raf raised in his comments on the, sort of, wider strategic context and also, your comments, David, about the importance of the longer-term relationship. There was this – one of the questions that’s come up, that nobody’s mentioned NATO and the, kind of, European geostrategic interests, a question about the UK’s position in the world and our, kind of, relative, sort of, medium size compared to much larger economies like the US and China.

David, perhaps I could ask you to finish on this question. Do you think that there is the chance that both sides come to view this negotiation in those more strategic terms that you talked about? I think you can see, you know, for example, the UK has, sort of, been – the UK Government currently isn’t very interested in a close foreign and security policy relationship with the EU, or certainly not an institutionalised one, we – you know, it’s all very focused on the details of the trade and economic partnership and the legal 17 Webinar: Brexit Negotiations and the Coronavirus Outbreak

construction of that, rather than on the wider security strategic relationship between the UK and the EU. Do you think that that can change, and if something as large as COVID isn’t going to shift perceptions, what might do it?

The Rt Hon David Lidington

Oh, I think it can change, and it’s very much in our interests nationally and the interests of other European countries that it does change, and you see some of this. If you look back at what President Macron has been saying about a Europe of circles, where he speculates about the gradual evolution of a system where you have tightly integrated eurozone countries, and around them other member states who are in the Single Market but not in the euro, and then, around them, countries like us, the Swiss, the Norwegians, who are not in the EU, but still have, sort of, certain privileged relationships, close relationships with the EU, and then perhaps the Western Balkans, so you – and they’re not all obliged, this is the key insight, they’re not all obliged to go for the same pattern of integration.

So, some of those ideas are not too different from what British Politicians of all parties have said in the past about, you know, a flexible Europe and a Europe more like a Commonwealth, a variable geometry Europe and so on. So, there’s interesting ideas there, but I think NATO will remain important. One consequence, though, of our leaving is that already, we see the 27 without the British veto now moving towards closer defence integration. For example, the defence industries than we wanted to see, and we always blocked in the past, and that will happen.

And I think part of the reason I want to see a good strategic partnership between us, and the EU is I think it’s important that that EU heft doesn’t seek to duplicate NATO, but to complement NATO. The Americans will want the European powers to work more effectively, to spend more on our mutual defence, and to do more to exercise more leadership, and there’ll be some things outside NATO’s remit. A lot of the strategic work that needs to be done in Africa, for example, which will affect our interests, means getting development, peacekeeping missions, climate change work, governments building work, to be focused in a complementary fashion, with the different European countries, in or out of the EU, working closely together for a mutual interest and advantage.

And the EU will bring something to the table because significant countries like Sweden, like Finland, in their different ways, smaller countries, Austria, Ireland, that contributed a lot to UN peacekeeping missions, but none of these are in NATO, can actually have a safe space through EU security co-operation when it’s just too prolifically or constitutionally difficult for them to join NATO as full members. So, I think the two can be made to be complementary, and I think it’s in our interests that they are.

Thomas Raines

Thank you very much. It is just over time now, so I’m going to have to draw things to a close. I want to say a big thank you to all the panellists for their contributions. We covered a huge amount of territory and detail there, so I’m really grateful for everyone’s thoughtful comments, for all of the questions. Sorry that I couldn’t get all of them in or I interpreted them in a certain way to bring – tie several of them together, but we appreciate everybody joining. Please keep an eye on the events at Chatham House, there’s tons going on, even if we can’t meet in person in the building, which I hope we will be able to do again in the not too distant future. So, a big thank you again to everyone for taking part, and I hope to see you again soon.