The UK’s Fearful Politicians Debate ‘Softer or Harder’ Brexit as Damage Mounts

Kirsty Hughes | 2 July 2017

State Opening 2017, UK Parliament, CC-BY-NC-2.0

As the unpredictability and chaotic politics of Brexit continues, UK politicians are engaged in a debate about what sort of Brexit the UK should choose.

It is a bizarre debate. It is one that takes little account of the EU27’s views – as if the UK can decide on its own whether to stay in the EU’s customs union (which no country outside the EU has so far done) or determine the length of any transition period (currently an argument within the Tory cabinet as well as amongst ‘soft’ Brexiteers).

It is a debate where the label ‘pro-EU’ is used for politicians who argue for a least damaging (‘soft’) Brexit rather than those – who seem almost entirely absent in the new House of Commons – who argue the UK must think again and reverse Brexit now, if the mounting damage, political and economic, is to be stopped. And it is one where Labour politicians argue there is some new set of institutions that can be designed that will deliver ‘the exact same benefits’ as the single market and customs union, while somehow being different to those two central aspects of EU membership. It is a bizarre assertion and one that again ignores the views of the EU27, with Keir Starmer talking in mystifying terms of ‘function not form’ being key.

In Scotland, despite the dominant importance of the independence debate, and despite the SNP’s ‘independence in the EU’ position, there is the same emphasis on a least damaging Brexit, rather than on arguing to stop Brexit now. Last week, SNP MPs joined with Labour rebels, Lib Dems and Green MPs to vote for an amendment to the Queens’ speech that would have kept the UK in the single market and the customs union. It got just 101 votes. But why stay in the customs union and single market rather than in the EU?

The Lib Dems still talk of a second EU referendum in 18 months time – while leadership candidate Vince Cable talks of ‘soft’ Brexit not of stopping Brexit. The SNP – having put off an independence referendum – appear unwilling to suggest the whole UK should think again on Brexit, much though that would be in Scotland’s interests. Our politicians are all Brexiteers for now.

Can the UK change its mind later?

There is also a presumption by some politicians that if the Brexit deal in late 2018 is not good enough, then it could be voted down – and that the UK could still change its mind and stay in the EU after all. But there is little agreement as to whether that vote (if it got a majority) would mean staying in the EU, having a second EU referendum (still only supported by Lib Dems and Greens) or going back – as the Article 50 time ran out – to ask the EU, hopelessly (as it would be), for a different deal.

There is also a presumption that the UK could simply decide to stay in the EU right up to the 30th March 2019. Legally, this may be true – though it could equally be contested as an interpretation of Article 50. Politically, it would be much more tricky. Merkel and Macron may have recently said that the UK could still change its mind – to a deafening silence from UK politicians – but the EU27 are moving on. UK-EU27 relations have already deteriorated – and could yet get worse. They are not, for some EU observers, remotely in a good enough political or diplomatic state for a constructive deal to be struck – let alone, in 20 months’ time, for the UK to change its mind and be welcomed back. Some in Brussels are talking of Brexit as irreversible, even while others still hope the UK’s current chaos could soon stop Brexit in its tracks.

And the EU in early 2019 will be in a different place to the EU of 2016 that the UK decided to leave. Political alliances and goals are shifting, new policy directions, including on defence, are under way, the Franco-German relationship is reviving. Economic growth is also reviving – unlike in the UK where current growth rates put the UK at the bottom of the league table. The EU27 will not want to welcome back a UK that is in a chaotic, divided political state – to carry on its bitter EU debate once again/still as a member state.

How soft is a ‘softer’ Brexit – and is it on offer from the EU27?

The political and economic evidence points to the damage Brexit is already doing: falling living standards, rising inflation, falling investment (with car industry investment so far in 2017 at a quarter of 2015 levels), businesses moving staff and offices to the EU27, and migration falling with many more EU citizens in the UK saying they may now leave (with all the damage that will increasingly do to agriculture, tourism, the NHS and more). This is before services trade with the EU – currently worth around £96 billion – risks falling by 61% even if the UK does strike a free trade deal with the EU27, goods trade by 35%.

Some politicians and commentators hope that the current political instability, with the government losing its majority (even with the DUP) if just 7 Tory MPs rebel, will lead to a ‘softer’ Brexit. Some are now defining a ‘softer’ Brexit as one outside the EU’s single market but inside its customs union. But no country outside the EU has ever been part of the EU’s full customs union. Turkey does have a customs union with the EU – covering industrial goods. It’s one that leaves trucks queuing at the EU borders for hours and days.

Do the ‘softer’ Brexiteers want to ask the EU to be fully inside the comprehensive EU customs union, including for fisheries and agriculture? What if the EU27 say no? Or if the aim is to be inside a customs union, like Turkey, only for goods, then agriculture, and fisheries, will face potentially tariff and non-tariff barriers. And outside the single market, UK businesses will also still face significant non-tariff barriers even inside a customs union with the EU: establishing regulatory equivalence and monitoring will be tough and the EU27 have no incentive to make trade as smooth as inside the single market and its four freedoms. Outside the single market, even inside a customs union, UK services exports will be hit sharply.

Without a customs union for agriculture, the Ireland/Northern Ireland border will risk being a hard one. The current EU27-UK Brexit talks on Northern Ireland have been labelled ‘political’ not ‘technical’ as the EU27 do not want to do work on the potentially difficult scenario of the UK being outside the customs union unless and until the UK government has made it clear that is definitely its political choice, for Northern Ireland, along with the rest of the UK – or not. But the existing and future damage to Ireland and to Northern Ireland are not much discussed in the inward-looking UK political debate between ‘hard’, ‘quite hard’ and ‘softer’ Brexit.

And, of course, in the ‘softer’ Brexit scenario – whether the ‘quite hard’ Brexit of being in the customs union but not the single market or the ‘super-soft’ Brexit of being in the single market and customs union (if the EU27 agree to such a comprehensive set up) or the ‘soft’ Brexit of single market/EEA membership only – the UK has no vote, no seat at the table for discussions on new regulations on chemicals, cars, environment, labour, or trade. Why a large country would want to create such a huge democratic deficit, one that would also be economically damaging as UK business and labour interests go unrepresented, is quite unclear.

But if UK politicians set the choice up as between a Canada-style trade deal with its highly damaging impact on UK trade or a somewhat less-damaging ‘quite hard’ or ‘softer’ Brexit with its democratic deficit and still fairly damaging economic impacts, then that is the choice some come to – though from Corbyn’s pronouncements so far, Labour’s leadership like the Tories, seems to be coming down on the damaging Canada-style deal side.

Some think too that the UK can sustain the mounting political and economic damage from Brexit until the end of 2018, when a vote on the deal (if the UK government hasn’t collapsed or walked away from a deal) might just reject it which might just open a path to staying in the EU. But why not then mount a campaign and argument now to persuade people that Brexit is more damaging already than anyone had suggested at the time of the referendum (some of the economic damage was indeed predicted but the degree of political damage within the UK and to the UK’s international reputation was not).

Public opinion moving ahead of the politicians?

Public opinion, even in the absence of political leadership, looks like it is starting to change – with the latest Survation poll giving ‘Remain’ an almost 9 percentage points lead, and with almost 80% of Labour voters now supporting ‘remain’. But the UK’s politicians are entangled in their own hard/soft Brexit debate.

Having voted for Article 50, Labour politicians are running scared of being labelled undemocratic if they now argue against the referendum result (a perfectly reasonable democratic thing to do). And also – from both right and left wings of the party – Labour politicians are mostly not prepared to stand up for the principle of free movement of people, and the political, social and economic benefits of EU membership and solidarity.

The Lib Dems, having run a weak election campaign, with their focus more on having a second referendum in 18 months time than on a strong argument for reversing Brexit now, are for now part of the ‘soft’ Brexit debate gang. The SNP too, absorbing their own changing political landscape in Scotland, are lined up on the ‘soft’ or ‘super-soft’ Brexit spectrum.

Meanwhile the Tories are fighting publicly over the impending leadership election (however long it takes to arrive) and over the terms of Brexit – and their voters still firmly back Brexit in the polls, unlike the Lib Dems, Labour and SNP voters.

It may be that the developing political and economic chaos of Brexit will not only push the opinion polls more clearly against Brexit but perhaps eventually (even soon?) shift the UK’s ‘softer Brexit’ politicians to a braver stance – to oppose Brexit now not in 18 months time or never. But for now, the UK is deeply ill-served by its politicians in their muddled, inward-looking, one-sided Brexit debates, and the damage continues to grow.

Kirsty HughesKirsty Hughes | Twitter

Scottish Centre on European Relations

Dr Kirsty Hughes is Director of the Scottish Centre on European Relations. She is a researcher, writer and commentator on European politics and policy, and she previously worked for a number of leading European think tanks.