Veteran Free Lunch readers will know how much I wrote in this space about the Brexit negotiations, especially about the challenges over Northern Ireland. Once Brexit was done and dusted, I hoped never to write about that again. But again and again, it turns out Brexit is never done and dusted for this UK government. It has now introduced a bill to breach the Northern Ireland protocol part of the treaty it signed to govern its exit from the EU. (See Anton Spisak’s Twitter thread for a useful and quick overview of what the bill does.) What to say about this latest Brexit move by Prime Minister Boris Johnson and his colleagues? That it is dishonest, hypocritical, and — depending on what you think it is meant to achieve — likely to be ineffective at best.
The dishonesty is clear enough. It is not true, as Johnson has been claiming for some time, that the protocol is working in unexpected ways. Its entire purpose was to put a regulatory and customs border between Great Britain and Northern Ireland in order to avoid one between Northern Ireland and the Republic of Ireland. Indeed, Johnson’s main “victory” in renegotiating the deal agreed by his predecessor was to shift this outcome from a last resort (a “backstop” if other solutions could not be agreed) to a first resort. He also secured agreement that goods entering Northern Ireland which both sides agreed were not at risk of being shipped on to the EU would benefit from any lower import duties the UK might negotiate with trading partners in the future.
(His other achievement was to secure that the Northern Ireland assembly had to regularly approve the continuation of the arrangements, a requirement which, ironically enough, the new bill seems to give the UK government the power to remove.)
The government is also dishonest in its claim that reneging on international treaty commitments is the only way to achieve the improvements in trade flows across the Irish Sea that it claims to want. Many have pointed out — see David Allen Green’s excellent blog post on this — that rather than breaking a treaty, the UK could have invoked the protocol’s Article 16 which provides for limited departures from its requirements in exceptional circumstances.
But there are even less disruptive options within the treaty framework. It set up a whole institutional structure, with a ministerial-level “joint committee” at the top with various specialised committees below it, for bilateral talks to resolve technical issues and figure out implementation problems. The committees can agree to update how the protocol is applied — which we know because they have already done so, as this 2020 joint committee decision shows. Sometimes this will take the form of the EU tweaking its own legislation in response to issues raised by the UK, as was the case with access to UK-approved medicines in Northern Ireland. The EU has offered further such changes.
This fact also reveals the government’s hypocrisy. If it really meant to improve conditions on the ground — although Northern Ireland is faring better than most parts of the UK in terms of growth — it would do the hard technical work of finding common positions on practical issues. It would also help reduce frictions in ways compatible with its treaty obligations — it could legally require vendors to supply the whole UK, for example, and provide financial compensation for the administrative burden of the Great Britain-Northern Ireland economic border.
Instead, the UK government makes a lot of unhelpful demands on the EU. The idea of a “dual regulation” regime will not do. All it would achieve is to jeopardise Northern Irish businesses’ currently frictionless access to the 500m-strong EU single market. Most of the UK’s other demands are both unrealistic and of primarily ideological, not practical, interest, such as the bid to shrink European courts’ regulatory oversight over Northern Ireland.
The one other substantive idea pushed by the UK, however, has merits. The principle of allowing transport into Northern Ireland through “express” or “green” lanes with minimal paperwork for goods that will reliably not enter the EU is now accepted by both sides. That was not always the case when it was proposed in the past, including by Raoul Ruparel, once a No 10 Downing Street adviser on the Brexit negotiations. With the right political directions from the top, and a genuinely constructive attitude from the UK, an agreement is possible. But so far, the UK government is not taking yes for an answer.
It is, instead, violating a treaty the prime minister signed, ran an election on, and got through parliament less than three years ago. What will this achieve? For the reasons set out above, it is no way to go about solving practical problems on the ground, so the UK government’s approach will be ineffective in that regard. Whether it is effective in cajoling Northern Ireland’s hardline unionist politicians to rejoin the power-sharing institutions so a functioning regional government can be set up remains to be seen but the signs are not good at the moment.
Suppose, instead, that the desired purpose is what the hardest Brexiters clearly want: to end any UK obligation to the EU on anything at all. That would require not just reneging on the Northern Ireland protocol, but on the whole Withdrawal Agreement of which it is a part, and, of course, the bigger Trade and Cooperation Agreement that settled the post-Brexit trade relations between the UK and the bloc. Breaking international law so baldly could trigger a chain of escalation that would end in an outright trade war. That would be devastating but, if economic vandalism is your sort of thing, not ineffective.
Most likely, it will not come to that. One view I have heard is that what will happen next will be determined by the timelines of the bill’s passage on the UK side, and the EU’s legal actions on its side. These are both on the order of months. If they culminate at around the same time, the pressure for finding a solution that allows everyone to pull back will come to a head. If experience is any guide, that solution will look very much like what the EU is offering today. That, perhaps, could be sold as the approach being effective in the end — in the sense in which doing the right thing after first trying everything else is effective.
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Numbers news
The Federal Reserve raised its policy rate by 0.75 percentage points, the biggest single increase since 1994. My colleagues over at the Unhedged newsletter tell you what they think about it.
Source: Economy - ft.com
