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Artillery Row

No deal Brexit? What about the deal that is already signed?

The government’s commitment to the Withdrawal Agreement compromises a clean break Brexit

Responding to yesterday’s expression of studied indifference to finding a deal by the European Council, Boris Johnson gave his response this morning. “Given that they have refused to negotiate seriously for much of the last few months, and given that this summit appears explicitly to rule out a Canada-style deal,” he announced that, “I have concluded that we should get ready for January 1 with arrangements that are more like Australia’s based on simple principles of global free trade.” Since Australia does not have an FTA with the EU, that means WTO terms.

Briefing lobby journalists following the prime minister’s announcement, a Downing Street spokesman struck an even more emphatic tone. “The trade talks are over” he said, “the EU have effectively ended them by saying they do not want to change their negotiating position. The EU can either fundamentally change its position or we leave on Australian terms. There is no point in trade talks if the EU doesn’t change its position. The EU effectively ended trade talks yesterday.”

Then he added, “It’s over to the EU now.” So, it’s over, unless the EU make an imaginative move.

The impression is being cultivated that the European Council’s dismissive conclusions yesterday came as a shock to Downing Street and to the UK’s chief negotiator, David Frost, who speedily tweeted that he was “disappointed” by the Council’s conclusions and “surprised [the] EU is no longer committed to working ‘intensively’ to reach a future partnership” – an approach that he thought the Commission President, Ursula Von Der Leyen, had endorsed on 3 October.

Nevertheless, Michel Barnier is still planning on being in London next week and talks are talks, regardless of whether they are tagged as “escalated” or “ongoing” or “clarifying.” The prime minister’s spokesman did not quite go so far as to suggest Barnier should save himself the bother of the journey. But he did endeavour to dampen expectations, advising that “there is only any point in Michel Barnier coming to London next week if he is prepared to discuss all of the issues on the basis of a legal text in an accelerated way without the UK being required to make all the moves or being willing to discuss the practicalities of areas such as travel and haulage.”

The absence of a shared legal text from which to work has been a perpetual irritant to Frost and his team, so this is nothing new. But Barnier clearly is welcome to proceed with discussing a succession of mini-agreements on areas like travel, haulage and social security where there has been considerable progress. Journalists are being encouraged to believe that this is the future of EU-UK discussions between now and 31 December: a comprehensive free trade deal there will not be; but some sector-specific agreements can and will be reached.

talks are talks, regardless of whether they are tagged as “escalated” or “ongoing” or “clarifying.”

Beyond this, the message from Downing Street is almost as blasé as yesterday’s conclusions of the European Council. It is that as a consequence of leaving the Single Market the major inconveniences to frictionless trade were always going to happen from 1 January regardless of an FTA. The only major difference is the imposition of tariffs where an FTA would have removed them. Last month, the British government’s worst case scenario if hauliers and traders failed to prepare adequately for these changes (and infrastructure was also not in place in time) predicted queues of 7,000 lorries being backed-up from Dover. This would happen regardless of whether there was an FTA, although Michael Gove, who announced these projections to the Commons, has long been the keenest Cabinet proponent of finding such a deal.

The reality of the situation is that the UK will be trading on WTO terms only if that deal continues to remain within sight but not within touch. In that respect nothing has changed this week compared to last week.

For all the absence of a shared legal text, the basis for overcoming one of the two stumbling blocks (state aid) exists. Only fisheries remain at odds. Even there, a deal could of course be found. Emmanuel Macron is insistent that French fishing fleets must continue to enjoy their existing catch in British territorial waters after 1 January. Thanks to decades of the Common Fisheries Policy, the British no longer having fishing fleets large enough to fish those waters exclusively. So France would have continued to enjoy a generous quota, just not the indulgent luxury of the status quo forever.

That over the last couple of days there appears to have been so little attempt from other European heads of state to get Macron to embrace this still favourable reality is certainly a remarkable indictment of how carelessly Europe is led, even when the alternative to a sensible compromise on fisheries is the UK imposing a broad range of reciprocal tariffs against European imports into a market where it currently enjoys a £72 billion trade surplus.

Yet, the EU’s insouciance is more understandable given the terms Boris Johnson agreed in the Withdrawal Agreement. Only a refutation of that Agreement would signal to Brussels that the UK has genuinely renounced finding a deal, given how damaging to the UK’s integrity without a deal the Withdrawal Agreement’s terms are.

the EU’s insouciance is more understandable given the terms Boris Johnson agreed in the Withdrawal Agreement

Asked specifically on whether the UK would persist with the Agreement and the Northern Ireland protocol it implements, the prime minister’s spokesman said, “There is a Joint Committee process which is ongoing in relation to the implementation of the protocol.” Believers in the sanctity of international agreements will be relieved. Less so should be Brexiteers who imagined that leaving the EU made Britons masters in their own house.

If Michel Barnier’s service to cross-Channel relations really is now merely one of tidying-up some mini-agreements instead of concluding a comprehensive free trade deal – as Downing Street suggests – then the prime minister must ready himself to face the Commons. With regard to the Withdrawal Agreement, his spokesman spoke of “measures” to ensure “a safety net should they be required” – a reference to the relevant provisions of the Internal Market Bill and to the “at risk category” of British mainland-Northern Ireland trade that is imperilled by the Agreement’s guarantee of the EU’s definition of an ‘open border’ between its member state, the Irish Republic, and Northern Ireland.

Constrained through want of a clear majority in the “Remainer Parliament”, Johnson needed a way out prior to the escape route that December’s general election offered him, and he agreed the Withdrawal Agreement with – as he assured senior Conservative members of the ERG – a couple of crossed fingers behind his back. What he had nevertheless agreed with Leo Varadkar in October 2019 prioritised the smooth operation of the EU’s Single Market at the expense of the UK’s internal market.

It is through the coming Finance Bill that Johnson can endeavour to make significant rectifications to what has already agreed. This legislation will now be the focus for anxious sceptics. As it stands, Boris Johnson has the choice of capitulating to Brussels, capitulating to Tory backbenchers, or effectively severing off one of the four constituent parts of the United Kingdom.

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