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- There is a deal to be done
“We need a clean break before article 50 ties us up in knots”
Bernard Jenkin
The unreconciled Remainers are urging, “Play for time” in the hope that the UK’s desire to leave the EU will subside. This is madness. They used to deride their present objective: that we could somehow stay “in the single market” but escape the obligations of EU membership. EU leaders, such as the Italian prime minister last week, continue to make clear that this is impossible. Any deliberate and unnecessary delay would refuel the anguish and bitterness that led many people to vote Leave in the first place.
That is why a growing number of people support a speedy and clean break with the EU. Nigel Lawson and David Owen have urged this. Now a group of senior Conservative MPs, including Iain Duncan Smith, John Redwood, Owen Paterson and myself, have set out a series of essays (Road to Brexit, Legatum-CSJ) explaining exactly what Brexit means, how it can be achieved quickly, and why it is in everyone’s interests.
We need to be aware that Article 50, as intended, could tie us up in knots. Nobody can guarantee that there will be an acceptable agreement at the end of the process anyway. So we must be prepared to leave without any formal agreement if necessary, or the commission has us over a barrel. Leaving without a formal withdrawal agreement would be messy, but a messy Brexit is what many have suggested that the commission and much of the EU would like. Still, a speedy and decisive resolution would be far more acceptable to business than years and years of uncertainty and then a “fudge”, as confirmed by Markus Kerber, head of the BDI, the federation of German industries.
Without a formal agreement, most things, like security cooperation, would carry on anyway because they have to. Complicated things like patent and data law could be quickly sorted out afterwards. Of course, the big threat is loss of access to the single market, but the UK could start by making it clear we are offering zero tariffs for EU imports, and an open UK market for EU services as now, and that we would implement this unilaterally pro tem in the absence of a withdrawal agreement. What would the EU do? Would they really want to slap on their own tariffs and protectionism anyway?
There are two other factors that will drive the UK and the EU towards a quick free trade deal, pre- or post-Brexit. We often pointed out that the UK imports £70bn more from the EU than we export to them, and Remainers always talked down this strength in the UK position. True, while 44% of our exports go to the EU, only 8% of EU exports come to us. But as thinktank Civitas explains, protectionism would threaten a far bigger share of jobs in the other EU states than in the UK.
UK exports to Germany are estimated to support 752,000 jobs, or 2.4% of UK jobs, but 1.3 million German jobs depend upon their exports to the UK, which is 3.2%. This pattern is repeated across the entire EU. UK exports to France support 1.7% of our jobs, but theirs to the UK support 2.4% of jobs in the France; to Italy, it is 0.9% vs 1.7%; for Belgium, it is 0.8% vs 7.8%; and for Ireland it is 1.4% vs 9.5%.
Which countries would rationally support anything but free trade?
Even in the event of tariffs, we could spend the billions of extra revenue on reducing company and employment taxes and increasing investment allowances, to offset the tariff costs on industry. We should make that clear to inward investors like Nissan now, so they have no cause to pause investment plans. The other factor is the net £10bn UK contribution to the EU. Sudden loss of this would cause chaos in the EU budget. There is a deal to be done, and quicker than most imagine.
www.theguardian.com
Bernard Jenkin is MP for Harwich and North Essex and was a founding director of Vote Leave. He is chair of the Commons public administration and constitutional affairs committee.
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