Some helpful insights from the Freight Transport Association

The really hard tasks will begin soon. Once Article 50 is triggered, the UK government will then have to negotiate a Brexit deal that will enable our trade with both the EU and the rest of the world to continue.

As an example of how complex this might be, the Freight Transport Association (FTA) has published a submission it made to Parliament, expressing a number of concerns facing the industry.  Like many organisations involved in trade with the EU, the FTA wishes to ensure that we do not face huge disruption as a result of Mrs May’s decision that we will leave the Single Market.

The piece is worth reading in full, but a few points are worth highlighting:-

  1. There will almost certainly need to be a transitional trading arrangement between the UK and the EU. Negotiating a full trade deal may be very tight, if not unachievable, within the two year timescale of Article 50.
  2. No deal will give us as unfettered access to the Single Market as EEA membership would have done. There will inevitably have to be some trade-offs.
  3. Increased Border controls will be very time-consuming. Falling back on the WTO option would be particularly bad in this respect. The port of Dover would suffer more than anywhere else as freight movements are predicted to rise to between 14,000 and 16,000 per day in the next decade.
  4. Although tariffs are falling worldwide, some sectors of the economy would suffer if tariff-free access to the EU were lost. Tariffs of 10% or more could be imposed on motor vehicles, for instance.
  5. The biggest worry is that the EU may not want to tackle trade issues until after Brexit.  Michel Barnier, the European Commission’s Chief negotiator, made a statement suggesting that the two-year period following the formal triggering of article 50 would only be devoted to withdrawal arrangements and that issues related to the post-Brexit trade relationship with the EU would only be dealt with post-Brexit.  While this is only one person’s opinion and that other voices within the EU are keen to avoid such a disastrous scenario, it shows that the UK’s negotiators will be facing some quite difficult individuals on the other side of the table.

No, Brexit is not going to be easy. We can but hope that the Government has been preparing for these eventualities and knows what it wants before the negotiations begin.

 

Keep the champagne on ice for a few more days!

 *** Post Script: Since this article was first posted on the website, it has been announced by a Downing Street spokesman that Mrs May will trigger Article 50 on Wednesday Week – March 29th. ***

Following Brexit developments since the memorable vote on 23rd June last year has been rather like watching paint dry. However, it does finally look like the long wait is over. The European Union (Notification of withdrawal) Bill has finally completed its passage through Parliament in its original form. The amendments proposed by the House of Lords were defeated in the Commons and now only Royal Assent is required.

Government sources have said that Mrs May will invoke Article 50 in the final week of March. A decision to do so straight away would be seen as playing into the hands of Dutch eurosceptic parties. A General Election is being held in the Netherlands tomorrow (March 15th) and Geert Wilders’ Partij voor de Vrijheid has been topping many recent opinion polls. At a time when accusations are flying here, there and everywhere about foreign interference in domestic elections, Mrs May will not want to give the EU any reason to accuse her of such behaviour, given the negotiations will be delicate enough as things stand.

Mrs May needs to steer clear of 25th March for similar reasons. This date marks 60 years since the signing of the Treaty of Rome, which formally established what has become the European Union. Celebrations are planned in Rome to mark the event and although the beginning of the Brexit will inevitably have to be fairly close to the festivities, triggering Article 50 immediately before March 25th would not win us many friends.  To  celebrate the beginning of Brexit at a time when EU-27 will be attempting to celebrate the European Union’s achievements against a backdrop of rising euroscpticism across the Continent would not be very good manners. Let’s face it, many of us who worked so hard to ensure our countrymen voted to leave the EU will surely want to crack open a bottle of champagne when the  formal departure process begins. Let’s keep it on ice for that bit longer. It won’t do us any harm.

Domestic politics also have limited Mrs May’s options. The SNP holds its Spring Conference in Aberdeen this coming weekend with Nicola Sturgeon threatening a second independence referendum following the Brexit vote. Mrs May has declared herself a strong supporter of “our precious union” and therefore wisely does not want to fan the flames of Scottish nationalism given that the result of a second referendum could be hard to call.

It is a relief, however, that the final obstacles in the way of triggering Article 50 have been surmounted. Then begins the hard graft. Unless both parties agree to an extension, we have to get a deal in two years which will enable our economy to function on day 1 of Brexit. There has been much posturing on the EU side, with talk of a big divorce settlement for the UK. It may turn out to be nothing more than a demand to honour our commitments to the end of the current seven-year EU budget cycle.

However, obstructive behaviour will benefit neither side.  If no agreement has been reached two years after Article 50 is triggered,  the Treaties no longer apply in our country and the UK and the EU would face a nightmare scenario in trying to relate to each other without any legal basis for so doing.

It is hard to imagine anyone wishing for such a calamity, but it is very apparent that our negotiators are going to have their work cut out to come up with a comprehensive settlement. Therefore, while we may be popping the champagne corks at some point before the end of March, it will be no more than a brief moment of light relief before the beginning of what is going to be a long, hard slog.

When turkeys really do vote for Christmas

“Don’t worry, Rupert,” said the backbench MP I was having tea with, “turkeys don’t vote for Christmas.”

The “turkeys” in question were the House of Lords, and the “Christmas” was the idea that they would seek to block Brexit by undermining Article 50 Bill.

Well, we now know that the Lords have voted to defeat the government on the rights of EU citizens in the UK – and by doing so have thrown UK citizens in the EU to the wolves. Given the size of the rebel majority, it now looks likely that the Lords will inflict other defeats on the government on this Bill.

This should not come as a surprise. There have been many instances in the past when turkeys have voted for Christmas. As a rule, this happens when the turkeys have managed to convince themselves that they are voting for Easter, not for Christmas. They ignore the gathering storm clouds heavy with the snows and blizzards of winter, and instead see only the narrow gleam of sunlight that they think heralds spring and so rush eagerly forwards seeking chocolate eggs.

Perhaps I am taking this analogy too far.

Let me give you some examples.

In 1785 the government of France faced bankruptcy. King Louis XVI brought in the financial guru Jacques Necker to solve the problem. Necker looked at the hideously unfair tax system by which poor peasants were highly taxed, but wealthy nobles lived largely tax-free. He proposed a new tax system under which the nobles and the Church paid their fair share of taxes. The nobles were appalled and forced Louis to sack Necker, bringing in a more compliant finance minister who scrapped the idea of taxing the nobles. The noble turkeys thought that they had voted for chocolate eggs at Easter, but instead had voted for Christmas in the form of the French Revolution that followed. Many of their heads fell on the guillotine as a result.

On 5th December 1648 the English Parliament voted to accept a proposal from King Charles I that put forward a new settlement to end the Civil War that had been raging since 1642. They had forgotten that the army leaders no longer trusted Charles and would accept no deal that saw him returned to power. The next day, the army arrived at Parliament in the shape of Colonel Thomas Pride with two regiments of armed soldiers. He arrested 45 MPs and threw them into prison, while another 300 fled. Only 151 MPs were allowed to take their seats, and they did so under the guns of the soldiers. The MPs had convinced themselves that they were voting for peace, plenty and the rule of law. Instead they had precipitated a military dictatorship headed by army commander Oliver Cromwell.

In 1221 the Governor of Merv, then one of the largest and wealthiest cities in the world, ordered the execution of some merchants. The pretext was that they had broken a rule on trading, but in reality it was because he wanted to confiscate their goods. It was, possibly, the most disastrous decision in history. The merchants were the envoys of Genghis Khan, ruler of the Mongols. Genghis Khan dropped everything to avenge the insult. He arrived at Merv with an army of around 50,000 men, stormed the poorly defended city and massacred the entire population. It is thought that over a million people were killed. The governor had thought he was voting for Easter in the form of a haul of treasure, but he actually played the role of a turkey at Christmas, as did the entire population of his city.

And so to today. The Lords believe that they can thumb their noses to the government and to the people. They think that they are voting for Easter in the form of flagrant virtue signalling and feeling smug over their smart dinner parties, while seeking to undermine Brexit.

It remains to be seen if they have voted for Easter or for Christmas.

Wishing us to fail?

If you have read the Bruges Group’s latest Brexit paper What will it look like?, you will be aware of the scale of the challenge Mrs May’s team will face in negotiating a seamless exit from the EU within the tight timescale imposed by Article 50 of the Lisbon Treaty. It will be intense – a very hectic time with the potential to go wrong – but the stakes are high on both sides. It’s neither in our interest nor that of the EU to reach Independence Day – possibly the end of March 2019 – without some agreement in place enabling trade to flow smoothly.

It is now over eight months since June’s memorable vote and since then, the UK economy has defied the gloomy predictions. Anyone signed up to the daily news briefs from Global Britain will be well aware of how well the business sector is doing.  Only yesterday, for example, the news brief carried reports of Boeing’s decision to establish its first European base in the UK, factories in Plymouth thriving and 500 new jobs being created at the University of St Andrews, including an enterprise centre.

It’s a far cry from the doomsday scenario painted by George Osborne. Thankfully, some remain voters who decided leaving the EU carried too great a risk have graciously admitted that they got it wrong. For instance, Andy Haldane, the chief economist at the Bank of England, said that the worst predictions may turn out to be “just scare stories” and that criticism of economists was a “fair cop” after they failed to predict the financial crisis and were wrong about the impact of the Brexit vote.

True, there has been some negative fallout from the Brexit vote. The fall in the value of sterling, while a bonus for exporters, has caused a rise in inflation, which is not welcome for consumers. This still needs to be put into context, however. At 3%, Spain has annual Consumer Price inflation running at a much higher level than in the UK  – indeed, the UK’s current inflation rate, 1.8%, is still below the Bank of England’s target of 2%. For most people in the UK, in spite of the inconvenience of rising prices, the Brexit vote has come and gone and it’s time just to get on with life.

There are the exceptions, however, the most prominent of which are politicians. Following on from Tony Blair’s intervention, Sir John Major’s speech at Chatham House rightly infuriated Mrs May’s ministers. Major did mention that negotiations were going to be a tough, which is a reasonable enough comment to make. However, the tone of his remarks were very different from the Bruges Group’s paper. He called the Brexit vote “an historic mistake” and sought to dampen down the optimism of Government ministers. “The hopes of those who favoured leaving the European Union are sky-high. We are told that countries ”are queuing up to do trade deals with us”. That ”our best days lie ahead”. It all sounds very enticing. And – for the sake of our country – I hope the optimists are proved right. But I’m not sure they will be… If events go badly, their expectations will not be met, and whole communities will be worse off.”

It is one thing to say that some Brexit supporters, including even members of Mrs May’s team, may have underestimated the challenges of the negotiations, but is there almost a wish for Brexit to fail? Are there some people who would positively like to see us slip into a calamitous recession if it means we bottle out and end up stuck in the EU?  Take the Guardian’s Polly Toynbee. Last November, she wrote, “Sooner or later, {Philip} Hammond will have to stop pretending the economy is OK.” What was the truth? The economy was doing much better than expected at the time and three months later, the picture hasn’t changed. One comment on the article said “significant inflation is already building up due to this mad plan to leave the EU.” As we mentioned above, the UK inflation rate is well below Spain’s or Belgium’s for that matter, but never mind the facts. It’s as if the unspoken message is “oh good – the more it hurts economically, the more chance there is of people reconsidering their decision.”

But it’s not just columnists and people who haunt the comment sections of on-line newspapers who seem to be willing a recession. In his recent speech Blair admitted that there was “no widespread appetite” for the referendum result to be reversed, but added that he wanted to “build support for finding a way out from the present rush over the cliff’s edge.” Oh wouldn’t it be lovely to have a catastrophe!

Assuming Mrs May manages a successful Brexit, that would be the end of any talk of staying in or rejoining this failing project, which is why, reading between the lines, Blair not only expects but seemingly hopes she will fail. If the secret wish of the hard core remainiacs is that thousands of people should be put out of work, lose their homes and endure poverty because it is the only way so we might be stopped from taking a step forward to freedom and self-determination, all we can say is that these people are merely acting true to form.  Perhaps the best comment on Blair’s intervention in tbe Brexit debate came from his former sports minister, Kate Hoey. “Why doesn’t he just now go and find himself a job?”

Why not indeed? It’s time that Blair recognises that his dream of becoming Europe’s Emperor Tony the First died a long time ago. The rest of the EU just wants us gone, Blair and all. There are few in Brussels who want a U-turn now. “This bus has left,” said one senior EU diplomat. “No one is happy about it. But we have moved on and the last thing anyone wants now is to reopen the whole issue.”

Photo by Eoin O’Mahony

A template letter for writing to your MP about fishing

Britain’s Maritime Resources & the Great Repeal Bill

You may like to use all or part of our Chairman’s letter to his MP as a template if you wish to write to your own MP expressing your concern that the UK does not end up with a Common Fisheries Policy Mark 2 and thus betray our fishermen a second time. We also need to renounce the 1964 London Convention, so that other countries do not acquire rights to fish in our waters. 

Dear……           

I write as a constituent as well as on behalf of concerned members of CIB and friends in the fishing industry. The surrender of our seas as a “common resource” to the EU was a particularly shameful act, as HMG was fully aware that the then EEC had no legal basis for the Common Fisheries Policy which it introduced into our negotiations to join at the last minute. There is now opportunity for a root and branch rectification of this disastrous decision.

* By international law all living marine species within the  200 nautical mile/median line zone belongs to the coastal state.

* A British Act of Parliament (Fishery Limits 1976 Act) established our Exclusive Economic Zone (EEZ) of  200 nautical miles/median from our coast.

* Under the  term of the European Communities Act 1972, this solely national resource was shared with every other EU member state.

* Our friends in the fishing industry advise us of the following figures.

UK catches in UK waters amount to 461,047 tonnes value  £593,600,000

UK catches in EU waters  amount to   88,126 tonnes value  £102,136,000

EU  catches in UK waters amount to  674,601 tonnes value £711,224,000

EU catches in  EU waters  amount to 568,575  tonnes value £777,081,000

* Repealing the ECA 1972 and invoking Article 50 of the Lisbon Treaty reverts control of the British EEZ from Brussels to Westminster Control, returning to the Fishery Limits Act 1976 and the London Fishery Convention of 1964.

* In the London Fishery Convention of 1964, the UK gave mainly  to France and four other countries rights to fish within our 6 -12 mile territorial limit zone. From 1986 the UK can renounce this agreement by giving two years notice. We urge that this should be done at the same time as invoking Article 50, so there is no overlap time.

* From the Brexit White Paper

To provide legal certainty over our exit from the EU, we will introduce the Great Repeal Bill to remove the European Communities Act 1972 from the statute book and convert  the “acquis”- the body of existing EU law into domestic law. This means that, wherever practical and appropriate, the same rules and laws will apply on the day after we leave the EU as they did before.

* The fisheries acquis includes the main fisheries regulation 1380/2013, which establishes who  catches what, where and how much in UK waters. So the figures quoted above would become British Fishing Policy.

* It seems incredible that HMG appears to have decided to run a policy based on regulation 1380/2013 so that EU vessels will continue to plunder 59% of the British people’s resource.

* HMG has made much of not being “half in and half out” of the EU and characterised the EEA/EFTA as that sort of arrangement. Yet Norway and Iceland, which are in EEA/EFTA, exercise whole and sole control over their own national fisheries. As with agriculture, they make their own arrangements.

* We urge that the UK’s arrangements should be no less sovereign over our own EEZ and territorial waters.

* We also believe that the whole of the existing CFP quota regime is unfit for purpose and should be scrapped.  Our expert colleagues in Fishing for Leave have prepared proposals for  control by permitted days at sea, as currently used in the Faeroe Islands. This  is far more practicable and removes the incentive to cheat. It can provide a more effective system with local ecological controls for the very different fishing grounds in our waters. Fishing rights should not be individual  property but remain under public control, inalienably for the nation.

* We also urge that immediate preparations should be made for an adequate force of Royal Navy Fisheries Protection Vessels, which could also provide a platform for HM Customs and Excise and Immigration Control purposes.

Yours sincerely,

Photo by Oldmaison

Labour’s Brexit dilemma

Before the EU referendum, many people thought that the outcome, whatever it might be going to be, was going to cause far more problems for the Conservative than the Labour Party. At least up to now, this is far from what has happened. Only one Tory MP, Kenneth Clark voted against Article 50 on 2nd February 2017 while 47 Labour MPs voted that way, showing how deep the divisions within the Labour Party over Brexit are at the moment.

A number of key statistics tell the story. Of the 230 odd constituencies held by Labour at the time of the EU referendum, 70% had Leave majorities. If London and a small number of university cities are excluded, the ratio rises to about 90%. Some of these Leave majorities were very substantial. In Stoke on Trent, where one of the recent bye-elections was held, the Leave majority was close to 70%. Among Parliamentary Labour Party members, however, the picture is very different. There is still only a comparatively small minority of committed Leave supporters, and most of the seats with the largest Remain majorities had Labour MPs.

This is what has caused the Labour Party such huge difficulties. Clearly there was a democratic vote in favour of leaving the EU on 23rd June 2017 which needs to be respected. Many Labour MPs who were both personally strongly for Remain and who had substantial majority support for this position among their constituency electorates, however, thought that they had good reasons, in their judgement, for voting against Article 50.

The danger then is that the Party as a whole loses out heavily in the country at large because of its ambivalent stance on Brexit – and more polling evidence emphasises the scale of this risk. On the one hand, of the 9.3m people who voted Labour in the 2015 general election, just short of 3.5m voted Leave in the EU referendum and half of these people, about 1.7m of them, say that they do not intend to vote Labour again at least partly because they are unhappy with Labour’s policies towards the EU. At the other end of the spectrum, fervent Labour-leaning Remain voters are concerned enough about Labour supporting Article 50 to desert the Party and to vote for the Lib Dems, which is clearly what happened in the recent Richmond by-election at the beginning of December 2016, where Labour finished up with only 4% of the vote.

Labour is thus threatened with losing large numbers of votes both among its industrial heartland blue collar erstwhile supporters, because it is not Eurosceptic enough, as well as from metropolitan middle class people, many of whom do not want to leave the EU at all.  Of course, issues to do with Brexit are not the only reason why the Party is in difficulties, but Brexit is currently dominating political discussion in the UK at the moment, and Labour cannot afford to call this issue wrongly. So what can it do?

The by-elections held on 23rd February 2017 provide some guidelines. In both Copeland and Stoke Central Labour’s share of the vote fell. Obviously, other factors were in play apart from Brexit but both the loss of the seat by Labour in Copeland and the low turnout in Stoke suggest that many Labour-leaning voters away from London and university cities are upset by the Labour Party’s lack of enthusiasm for Brexit.

Furthermore, even though there was some good news from a Labour perspective, this needs to be treated with caution. The threat from UKIP turned out to be much weaker than might have been expected, no doubt mainly because the Conservatives have promised to do much of what UKIP supporters want. Nor did either the Lib Dems or the Greens do well. The problem Labour faces, however, is that, as the main opposition party, it has to win support back from the government and this is not what is currently happening. Instead, it seems that the Conservatives have been much more successful on Brexit in positioning themselves where the country wants to be.

What, in these circumstances can Labour do? Really, there is only one way ahead on Brexit which has any realistic chance of helping it to recover the electoral support it needs to become an effective opposition, let alone the party of government. It cannot afford to disregard the result of the EU referendum both for democratic reasons and because the Party stands to lose much more support from those alienated by Labour backing off supporting Brexit than it is likely to lose by failing to obstruct the Brexit negotiations, which has to be Lib Dem and not Labour territory.

What Labour needs to do, therefore, is to recognise that it has to accept the referendum result and then to play as constructive a role as it can on the Brexit negotiations. This will not be secured by tactical manoeuvring against the government. It will be achieved by supporting the government wherever it is acting in the national interest, while no doubt carving out a distinctive Labour position where there is genuine difference of view, for example of social legislation. 

Brexit is all too likely to dominate the political horizon for all the period running up to the next general election in 2020. Labour needs to use this period to rebuild the electorate’s trust in the Party on the EU – as well as much else.

Photo by DavidMartynHunt