Dealer's choices

DianneHayter.jpgDianne Hayter weighs up the chances of Britain and the EU agreeing Brexit terms by March 2019

As the fifth round of Brexit talks gets underway, the House of Lords will be pressing the government on the prospects for agreement on Britain’s future relations with the EU by the time our scheduled 2019 departure. Given where we’re at on both the ‘divorce’ deal or transition arrangements (which the Bank of England’s deputy governor says is needed by Christmas), the honest answer is surely: “No chance!”

Even talks about that future relationship cannot start until the EU27 judge enough progress has been made on the deal. Commission President Jean-Claude Juncker thinks there hasn’t been ‘sufficient progress’ – a view shared by the European Parliament, where a 6 to 1 vote was supported by two Tory MEPs (both since suspended from the party).

Beyond London and Brussels, others are taking precautions.

The Federation of German Industries for example, has urged their companies in Britain to prepare for a “very hard Brexit” whilst setting up a task force to prepare for a period of disruption. All based on the observation that the British government is “talking a lot” but with little concept of where things are going. At the same time, the German Chambers of Commerce reckons that the prospect of ‘no deal’ – with the UK falling out of the Customs Union – could see German companies having to file 15 million new documents (at a cost of €500m) for duty purposes. And UK exporters would of course, face exactly the same sort of formalities.

We are already seeing the European Medical Agency fretting about losing a swathe of skilled scientists as it leaves the UK, and the nuclear industry fearing our exit from Euratom. The higher education sector meanwhile, is feeling the chill wind of the ending of free movement as top academics are reluctant to move here without a guarantee that their spouses can join them. Plus the EU Commission has now said it cannot guarantee Horizon 2020 funding for British applicants post-March 2019.

Looking at our all-important trade deals, any hope that we and the EU could easily negotiate a simple division of agricultural import curbs has been blown aside by the United States leading a group of countries to challenge our plans to retain EU import restrictions on agricultural goods. Added to the tariffs placed on Bombardier, mounting evidence suggests our old ally across the pond is not going to be that helpful in opening up world markets.

Labour has called for a transition period after Exit Day, with Britain remaining in the customs union, both to give time for negotiating on the long term relationship and to allow firms to prepare for any changes. The government has now adopted this position – but it can only be requested and we should not assume it will be granted. Indeed, unless and until Theresa May’s Ministers show willing over the payment of debts due and similarly urgent issues, any longer term agreement will be hard to reach.

Tragically for Britain, the shakiness of Mrs May’s government, Tory party infighting and the undermining of the Prime Minister by some of her parliamentary colleagues, are all evidence to the EU27 that we are currently in no position to prioritise serious negotiations on our withdrawal. It's also not beyond the realms of possibility that, whatever the financial cost our country, some ministers would rather end up with no deal if it gives them an opportunity to blame Europe.

So what chance a deal by March 2019? I for one, wouldn’t put money on it.

Baroness Dianne Hayter of Kentish Town is Shadow Brexit Minister in the House of Lords and deputy leader of the Labour Peers group. She tweets @HayteratLords

Published 8th October 2017

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commented 2017-10-09 14:43:35 +0100
Time for Labour to come off the fence and start campaigning for UK to Reamin in EU or at least in the customs union. May’s Government is going to tumble and Labour need to have a coherent and viable alternative to offer the public in an early election.

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