With all the votes in the General Election now cast, this blog explains that rather than seeing the end of Brexit, this now signals the end of the first stage of Brexit, with talks over the future relationship set to dominate 2020. This blog sets out the immediate impact of the election result on the Brexit process and what some of the key issues might be when the negotiations on the future relationship begin. This is one of three blogs from SPICe on the UK election result. Blogs on the election result and the full results in Scotland will also be published.
Introduction
Given the composition of the previous House of Commons and the resulting impasse over Brexit – where there was a majority against no-deal but no majority for any particular form of Brexit – the Prime Minister pushed for a December General Election. In his calls for an election, Boris Johnson claimed it was necessary to “get Brexit done”. Professor John Curtice argued that whilst elections are never about a single issue, voters in this election will be heavily influenced by their views on Brexit with most supporting parties who mirror their remain or leave views.
Analysis by The UK in a Changing Europe set out the parties’ differing manifesto commitments on Brexit and concluded that the most glaring omission relates to the significant economic effects of Brexit on the economy. The parties’ pre-election promises on Brexit can be summarised as follows:
- The Conservative manifesto pledged to “get Brexit done” and ensure the UK leaves the EU by 31 January 2020. The manifesto made little mention about the negotiations of the future relationship which are likely to be the focus of political attention throughout 2020 (and beyond?) but does claim that there will be no extension to the transition period beyond the end of December 2020.
- The Labour Party pledged to renegotiate the Withdrawal Agreement and put the new agreement and the option of remaining in the EU to a referendum within six months of the election.
- The Liberal Democrats pledged to revoke Article 50 and keep the UK in the EU if it won a majority.
- The SNP supported a second referendum on EU membership.
What now?
With the Conservative Party winning a sizeable majority of seats, attention will now turn to how the Prime Minister will seek to “get Brexit done”. The initial stage – taking the UK out of the European Union – should be relatively straightforward. With the necessary support in the House of Commons now in place, the Prime Minister has committed to reintroducing the Withdrawal Agreement Bill before Christmas, with the intention of passing it and completing the ratification process in plenty of time to allow the UK to leave the European Union on 31 January 2020.
However, this will only complete the first stage of the process. Many experts have argued that the next stage – negotiating the future UK-EU relationship – will be far more challenging than negotiating the Withdrawal Agreement which has taken nearly three years since Theresa May triggered the Article 50 process in March 2017.
Whilst the Prime Minister can command a majority for his Government in the House of Commons, in negotiating the future relationship, he will still face three challenges related to timing, content and Northern Ireland.
Timing
The Withdrawal Agreement provides for the possibility of an extension of the transition period for up to one or two years but states that a decision on extending the period must be taken by 1 July 2020. As a result, there is very limited time to agree a new relationship before the implementation period ends or for a decision to be made about extending it.
The Conservative Party manifesto stated that the UK Government would not seek to extend the transition period beyond the end of 2020. Taking this approach will take the pressure off needing to make a decision by the end of June but will dramatically raise the stakes in terms of what can be agreed with the EU in time for the end of 2020.
Sir Ivan Rogers, formerly the Permanent Representative of the UK to the EU has suggested that the limited time to reach an agreement means the UK Government may need to accept a sub-optimal deal. He argues that to ensure the UK doesn’t leave the transition period at the end of 2020 without the terms of a new trading relationship in place the UK Government will be under pressure to accept the EU’s terms for the new relationship.
In the event the UK Government chooses not to seek to extend the transition period and then fails to conclude its desired future relationship with the EU, at the end of December 2020 the country will once again face an effective no-deal cliff edge (in relation to trade in goods and services). This time though, the UK would be out of the EU and there is no clear and obvious way to delay such a no-deal scenario as was possible when seeking three extensions to the Article 50 process. For this reason, as Ivan Rogers has argued, it is possible the UK Government may feel it needs to accept the trade agreement on offer from the EU as 2020 draws to a close.
Content of the future relationship
The Conservative Party manifesto provided little detail about the future UK-EU relationship stating that:
Our deal is the only one on the table. It is signed, sealed and ready. It puts the whole country on a path to a new free trade agreement with the EU. This will be a new relationship based on free trade and friendly cooperation, not on the EU’s treaties or EU law. There will be no political alignment with the EU. We will keep the UK out of the single market, out of any form of customs union, and end the role of the European Court of Justice.
This future relationship will be one that allows us to:
- Take back control of our laws.
- Take back control of our money.
- Control our own trade policy.
- Introduce an Australian-style points-based immigration system.
- Raise standards in areas like workers’ rights, animal welfare, agriculture and the environment.
- Ensure we are in full control of our fishing waters.
The manifesto essentially reiterates the content of the Political Declaration which was agreed alongside the Withdrawal Agreement. Whilst the Political Declaration has no legal force, it provides a useful indicator in terms of both the UK and EU’s intentions for the future relationship. The key issues to note are:
- The UK’s intention to conclude a Free Trade Agreement with the EU.
- The removal of the level playing field provisions which had formed part of Theresa May’s Withdrawal Agreement, with them instead being referenced more loosely in the Political Declaration.
The striking element of the new Government’s commitment to negotiate a new relationship to be in place before the end of 2020 is the lack of any political-led discussion within the UK about what the country wishes to prioritise and achieve from the future relationship negotiations.
Northern Ireland
The Withdrawal Agreement means that at the end of the transition period Northern Ireland will remain a part of the UK’s customs territory but will also be aligned to the EU single market. Single Market alignment means that Northern Ireland will follow EU rules on things like agriculture and food. Any regulatory checks which are required on goods will be done at airports and ports and not at the border between Northern Ireland and Ireland.
Northern Ireland will also remain a point of entry to the EU’s customs zone. This means that:
- If goods are destined for and enter the EU across the border between Northern Ireland and Ireland then EU customs duties will be collected.
- There will be a legal customs border between Northern Ireland (as part of the UK) and Ireland (which remains part of the EU).
- The border will, in effect however, be between Great Britain and the island of Ireland. This avoids a so-called ‘hard border’ between Northern Ireland and Ireland.
The challenge for the UK Government will be putting in place the infrastructure and technical processes to allow the new arrangement to begin at the end of 2020.
In addition, the differentiated relationship for Northern Ireland is likely to face continued political opposition from Unionist politicians in Northern Ireland (due to the checks between Great Britain and Northern Ireland) and from the Scottish Government who have previously called for a differentiated Brexit approach for Scotland compared to other parts of the UK.
Negotiation of the future relationship
The negotiations on the future relationship are likely to begin early next year – once the EU Member States have finalised their negotiating mandate for the European Commission. The negotiations will be led for the EU by Michel Barnier, which will provide continuity following the Withdrawal Agreement negotiations. Adding further continuity, Sabine Weyand, Michel Barnier’s deputy during the Article 50 negotiations is now the head of the European Commission’s directorate general for trade, meaning she will play a role in the future relationship discussions with the UK.
For the UK, the Prime Minister will have to decide which Government Department is to lead the negotiations – options include the Department for Exiting the EU; the Department for International Trade or the Cabinet Office. It is likely that the Prime Minister’s Chief Adviser on Brexit, David Frost will play a key role.
When the negotiations begin, the UK will face the challenge of trying to achieve its objectives of securing a free trade agreement in the time available whilst protecting its red lines. However, as the BBC’s Europe Editor Katya Adler has argued, the EU is unlikely to agree to a free trade deal without obtaining concessions on level playing field regulations and securing EU fishing rights in UK waters.
In the aftermath of the election, the European Council President tweeted that the priority now was to get the Withdrawal Agreement passed and then move on to phase two where the EU’s priority would be to ensure a level playing field.
The key issues which will need to be addressed in a future UK-EU trade deal include:
- goods (product standards and tariff free access to markets)
- fisheries (access to waters versus access to markets)
- food and drink (access to market and standards and geographical indications)
- agriculture (potentially including issues around standards, quotas and subsidies)
- services (not usually addressed in a free trade deal)
- level playing field regulations (ensuring a level-playing field on issues such as environmental regulations, workers rights and State Aid)
- immigration (replacing free movement for UK and EU citizens with quotas?)
- justice and security.
These issues are all individually highly complex and taken together in an overall package may present challenges and require the UK Government to prioritise and make trade-offs during the course of 2020 (and possibly beyond).
Whilst the negotiation on the future UK-EU relationship is a reserved competence, given many of the topics likely to be discussed during the negotiations are devolved policy areas, there will also be a high level of political interest from the devolved administrations and legislatures.
The UK Government has yet to set out a process for conducting the negotiations or said whether it anticipates a role for devolved bodies. However, the Scottish and Welsh First Ministers have previously written to the Prime Minister to demand a commitment to full involvement of the devolved administrations in international negotiations which impact on devolved competence.
Once the UK has left the EU, the future relationship negotiations are likely to dominate political discussions throughout next year with an emphasis on reaching agreement before the end of 2020. The focus of the negotiations will include discussions related to devolved policy areas such as agriculture and food and drink which will mean that the devolved administrations and legislatures are likely to have a keen interest in influencing the negotiations.
SPICe will publish a briefing early next year on the negotiation of the future UK-EU relationship.
You can find out more about the results, How Scotland voted: UK General Election 2019, and what the potential impact of these results will mean for Scotland, Now that the votes are counted…, elsewhere on SPICe Spotlight.
Iain McIver, SPICe Research