Author: johnredwood

The latest call for a referendum between leave, the White Paper terms and Remain is a non starter. We made our decision in the original referendum and need to get on with implementing it.

The EU will not accept the government’s opening bid in the White Paper so it is not a real  option.

It is by no means clear we could get back into the EU on current terms once we have left in March 2019 were people and Parliament to change their minds. The EU would  probably want us to sacrifice our veto on the Euro and Schengen, and lose the contributions rebate for starters. It would need to be negotiated, with uncertain outcome, so that too is not a fixed and available option.

There is no point in voting on two options the EU does not accept. The real referendum was about two straightforward options – stay in on current terms, or leave. The EU agreed to both under their Treaty. We voted to leave. We were told  by Parliament and government voters were making the decision.

This week Mr Trump meets Mr Putin. I want the President to be realistic about Russian behaviour and how we need to respond. It would be good if  relations improve rather than a further deterioration with threats on both sides, without compromising important principles. Mr Trump may well wish to announce  new practical working approaches despite the differences.

The current UK government has been at the tough end of western attitudes towards Russia, in part owing to the poisonings in Salisbury. Of course killing people with nerve agents must be condemned strongly and my heart goes out to the families affected. Our relationship with Russia is, however, a complex one. The government and NATO  work in  close contact with the Russian authorities when acting militarily against Isis.  That makes sense, but reminds us how there are few absolutes in relations between important countries.  Germany, part of NATO, has made herself very dependent on Russian gas, as Mr Trump pointed out. Events and circumstances can change, and diplomacy needs to respond. A country has a range of interests. These can require agreements with countries that have very different values and behaviours and may need to reshape old alliances. We do have friendly working relations with a number of countries with whom we have profound disagreements on human rights and government behaviours.

Russia is a dominant power in the Middle East. President Obama’s decision to limit US force in the region and to stay out of much of the Syrian war has ensured growing Russian influence. President Trump has not changed this policy, though he has taken specific action over chemical weapons use. Given this development the USA, UK and other NATO allies co-operate closely with the Russian military where Russia does hold sway. and need to do so to avoid inadvertent clashes.

Russia upset the EU through its actions in Crimea. This led to sanctions and tough words. The western allies however are not going to try to prize Crimea apart from Russia by force, so at some stage there needs to be discussions about how to proceed despite  this dispute. Russia would say the bulk of the people of Crimea want to be Russian, so under the doctrine of self determination it makes sense. The West says there was no internationally approved referendum to test opinion and make this decision. The EU needs to watch to see what if anything the President says on this matter, as we need to avoid a major split on the subject between the USA and the European NATO members.

David Davis’s letter raised important issues about the process of government. We learned from the background to it  that the Secretary of State for Brexit who should be the principal adviser of the PM on these matters, and the main negotiator under the PM, was often sidelined by the official civil service. Of course this could only happen if No 10 let it happen, whether by design or by misunderstanding. It nonetheless raises crucial issues about how democratic government is functioning at an important time for our country.

There appears to have been a tough approach taken towards much of the Cabinet over the production of the White Paper. Apparently many Ministers saw the draft late, and were given little time to respond. On a major policy document like this, published two years after the first demand for it, you would expect all relevant Ministers to be fully engaged through correspondence, sharing drafts, and through Cabinet committees where necessary. At its best UK government is very good at this, with several drafts refining views as Ministers seek improvement, attend to detail, or find compromises.

There needs to be trust between all Ministers and senior officials. They need to share their work in private with each other. Officials are welcome to their  views and to put in suggestions, but in the end Ministers have to decide, to approve the lines and sign off the final text. Clearly this did  not happen with the Chequers Statement and White Paper, which is why it triggered several resignations of Cabinet Ministers, junior Ministers,  and Parliamentary Private secretaries. It also led to the resignation of   two Vice Chairmen of the Conservative party who would of course be outside the formation of a collective view on this or any other government matter, but need to sell the policy. Their refusal to do so reflects the fact that the more politically minded members of the Cabinet did not have enough chance or enough support to get the strategy amended to one which could gain more popularity.

The lack of trust  by some Ministers is part of a much wider distrust between public and officials on the mighty topic of the EU. Viewed from the outside to many members of the public  it looks as if a large  number of officials voted remain, think the voters were wrong to vote Leave, and are doing their best to re run Project Fear in various guises. I of course appreciate there are many good officials who do not let their personal political views influence their work, and some officials who did vote Leave who therefore support the government policy of leaving willingly. What is undeniable is the civil service as a whole have taken to the task of trying to find as many  difficulties as possible that they think might delay or impede Brexit, and have been very shy about finding and tackling all the opportunities that a clean Brexit brings.

Of course where something needs fixing by March 2019 to make sure things work as planned, the civil service are right to flag that up. They should also flag up the remedies as well as the problems. They also need to help Ministers knock back the self serving and factually incorrect fears that some Remain oriented groups and businesses are putting forward.

I trust  now Cabinet has reaffirmed its wish to get on with the WTO Global UK option there will  be strong co-operation to do so. I would also like to see good news policies covering a new migration policy, a new farming policy, ways of spending the money we will free if we simply leave in March 2019, and what we should do with all the customs revenue if we end up on WTO terms. The civil service at its best is balanced in its judgement of risks and opportunities, and keen to implement the government’s policy. The government’s policy as specified in 2017 was to leave the EU. The civil service have helped talk the remaining Ministers into a policy which does not amount to leaving the EU. The  Ministers who relied on this bad advice have now placed themselves in a difficult position, where they need to change their policy as soon as possible so we can conduct good and strong negotiations for the UK.

I keep hearing  the falsehood that the Brexiteers have no alternative plan to the government’s White Paper. I point out we have proposed a comprehensive free trade deal, or the WTO Global UK options.

Then I am told wrongly  we have no worked out White Paper to match the government’s. We published a 108 page document entitled “The Road to Brexit” based on the all day experts seminars we held on October 16 2016 and 27 January 2017. This document set out how to send the Article 50 letter and how to handle the UK legal issues in a single Bill which became the EU Withdrawal Bill. It went on to discuss how to negotiate a free trade agreement, and how to put in place winning policies on fishing, farming, the budget, taxation, migration, borders and much else where there are gains to be had from leaving.

Some of this was summarised on this site in the form of the Minutes of the first seminar on October 3 2016.  The document is still good advice today.

One of the most deceitful arguments some Remain advocates use  is that the car industry depends on the EU for its success and would be adversely affected if we leave. They need to explain the damage membership of the EEC/EU did to it.

In 1972, our last year  as a free and independent country, the UK made 1.92 million cars. After just ten years in the EEC/EU that had crashed to just 888,000. Our membership was devastating to us, removing more than 50 % in a decade.

We have never made as many cars in any year during the whole 45 years of membership as we did the  year before we joined. Why did this happen?

Before we joined UK people mainly bought UK built cars. On joining we had to remove all tariffs and some other barriers on goods like cars where the Germans and French were more competitive. They did not remove barriers on services where we were  more competitive. When the tariffs came off more UK people chose continental cars and our industry faced savage cuts in jobs and output.

In later years we rebuilt some capacity thanks to Japanese and Indian investment, whilst losing much of the US capacity in the UK. Some manufacturers chose to switch production to cheaper EU locations in Spain and Eastern Europe.

We were told by some manufacturers that they woukd stop investing here if we failed to join the Euro. That turned out to be a lie. In recent years leading foreign carmakers have praised UK workforces and increased their investment.

The story of the car industry is a cameo of industry generally. EEC/EU membership wiped out a lot of industry in the 1970s when tariffs came off, with too few offsets given the one sided  liberalisation of trade. The UK has run a huge balance of payments deficit with the EU for most of our membership as a result.

Were the EU to insist on WTO tariffs the extra cost of German and French cars in the UK would doubtless lead to more UK buyers buying home produced vehicles.

Some commentators see symmetry in the interventions anti and pro Brexit by successive Presidents. There is one crucial difference. President Trump is not intervening in an election or referendum, whereas President Obama deliberately tried to influence voting. Most of us think a government leader  should not try to influence an election in another democracy during an election period. As it happens, I think it was an ill judged intervention, as it added to the unreality of Project Fear and ended up helping the Leave campaign.

The other difference with Mr Trump’s intervention is his is a factual statement. Were the UK to accept the White Paper position it would  be much more difficult to agree a Free Trade Agreement with a non EU country. President Obama, on the other hand, was saying he would seek to delay a UK free trade agreement which would otherwise have been possible.  The Trump Administration would like to do a free trade deal with us, but can only do so if we leave the EU, single market, customs union and surrogates for them.

The White Paper proposes the UK staying in much of the current EU. White is the colour of the flag of surrender. Much of this White Paper sacrifices the bold idea we voted for, that we wish to  be a free and independent country again.  It wants us to stick with the European Chemicals Agency, European Aviation Safety Agency and the European Medicines Agency, with Europol and Eurojust, with a joint customs area, continued co-operation on energy and transport, minimum EU regulatory standards in many areas, joint military development and an EU data regime. We offer to pay for all these things!

No, we voted to leave. Leave means leave. It means doing these things for ourselves, not paying the EU to do them and accepting EU rules and controls. The legal format of forcing us into an Association Agreement which bind us to all this through a Treaty is the worst of all possible worlds. We voted to be free, not to  be bound in in some new way. The government says we would be able to diverge if we wished, and there would be independent arbitration. If we sign a Treaty we will be told that the people and Parliament are bound by it, and our freedoms will  be circumscribed or lost again. We did not vote to come out of one Treaty only to sign up to a watered down version of it instead.

Lets take the case of medicines. The UK has a strong position in the pharma industry, leading research universities in the field, and many experts. We should re establish our own Medicines Agency, and sell its services to third countries who would value our skills and knowledge, and would wish to be associated with our high standards. Our own Agency could be a focus of further work to expand and improve our industry, and the money spent on it will be spent in the UK, not sent to Brussels.

Or lets take the case of Aviation Safety. The UK has very high standards which we wish to preserve and a high proportion of EU air travel, given the dominance of London as an aviation hub. Again our global reach and ambition requires us to establish our own Agency and to work at a global level on high and rising standards.

The language of the government that they will end “vast annual contributions to the EU budget” is not good enough. We voted to stop paying any money to the EU, not just to the EU budget. Offering lots of smaller sums to a range of policies and Agencies, recreates our subservience to the EU and continues the strain on our balance of payments. Where there is regulatory work to be done, lets do it at home with UK experts and administrators.

Why do large parts of the UK establishment so despise us that they do not want us to lead or to adventure for ourselves? Why do they so dislike freedom? Do they really believe the best we can do is to be rule takers, meekly paying the continent danegeld?

I have spent time discussing  the detail behind the three page Chequers Statement that I found wanting last week. On the eve of the White Paper, which is the longer version of the Chequers Statement, let me share with you why it has to change.

The Statement is based on the false premise that there is a border problem between Northern Ireland and the Republic which needs special arrangements on customs and trade to get round. I will explain again another day why this is untrue. It offers the EU a “common rulebook” to govern trade in goods and agricultural products. It offers a guarantee of no dilution of standards in a wide range of other policy areas. It proposes collecting EU customs dues on goods circulating in the UK destined for the EU, but does not say the EU has to collect UK customs on goods circulating on the continent destined for the UK. It says there needs to be a “Mobility” Agreement which erodes UK control of our borders and  migration.

The legal structure of the proposal is particularly worrying. The government wants to enter into a new Treaty or Treaties with the EU, creating a binding international law obligation over and above any UK Parliamentary say on these matters. The government says dispute resolution will be ultimately by an independent third party, but in practice decisions and policies of the European Court of Justice towards the common rulebook will be important and will be taken fully into account should the matter reach independent arbitration. Parliament will doubtless be told should we sign such a Treaty that in practice we have to follow its spirit as well as its letter.

The so called common rulebook is not a common rulebook. It is the EU’s rulebook. That is why the ECJ will be important, as they define the rulebook along with the other institutions of the EU. The UK will have to accept all old and new laws that comprise the rulebook. It is true Parliament would have the right not to enact a new law, but there will be consequences with the EU allowed to impose trade penalties. It is also unclear how the Treaty obligation would sit with Parliamentary authority. I suspect Parliament would be told where it wanted to deviate from the EU rulebook both that there will be unpleasant consequences and that it breached the Treaty obligation.

The idea behind the dual customs system is that the UK can impose its own tariffs on goods for its market that are not necessarily the same as EU ones. This creates a complex set of arrangements, where the UK  not only collects EU duties, but has to trace and follow any good coming into the UK to make sure it does move into the EU. A Free Trade deal would be a much better way of capturing benefits, with the preservation of tariff free UK/EU trade.

The Mobility framework has still to be defined,  but it is likely the EU will push to recreate something like  freedom of movement. I presume the UK government will resist this, but they would also need to be very precise and limited with concessions to avoid losing the right to design and implement our own migration policy.

Enjoy the game!

The one good thing to come out of the Chequers meeting was confirmation that the government will speed and complete its preparations for leaving the EU without a deal. The government says it  does not want to have to do that, but it needs to do it in case that it is the outcome to the slow and unhelpful talks. It is also important to put some weight behind the UK’s bargaining position.  Only if the government is prepared to exercise the No Deal  option does the UK have clout. We should expect to see and hear more of the successful preparations in the days ahead.

No Deal delivers most of what Brexit voters want. It means we leave the EU on 29 March 2019 as promised. We leave without paying any extra money to the EU as a leaving present. We regain control of our laws, our borders and our trade policy. The only thing it does not give us is a free trade deal with the EU.  I suspect if we look as if we mean to leave without a deal the EU would want to extend its current offer of a free trade deal for Great Britain into an offer for the UK, as we will of course not accept one which leaves out Northern Ireland.

The  biggest win from no deal is the opportunity to spend £39 billion at home on our own priorities that we would otherwise give away to the EU. £39 billion spent at home would be a big  boost of 2% of GDP. It would cut our balance of payments deficit by the same amount. Depending on the mixture of tax cuts and extra spending we chose, there would  be additional gains from the stimulus effect of the money. The right tax cuts could power faster growth and more business success. Well deployed spending on education and training could help more people into better paid jobs.

We should also use all the £13bn we colect in tariffs on EU imports to give as tax cuts to UK consuners so we are no worse off from the tariffs. Doubtless we will also buy more UK goods when EU ones are dearer so we will be better off.

The next win from just leaving will be the right to control our own borders and settle our own migration policy. I expect the government to  make it easy for tourists, students, investors and people with good qualifications to come to the UK.  What the public wants is a decent control on people coming to the UK to take low paid employment, when we need to up the wages and recruit more local people to do the jobs, whilst investing in labour saving automation where the jobs are unattractive. We need to alleviate some of the stresses on housing and infrastructure which high migration rates in recent years have exacerbated. We want a fair policy, which does not give priority to people from continental countries over people from the Commonwealth.

The third win will be in global trade. Australia, New Zealand, Singapore, Canada and the USA are keen to sign trade deals with us. We could join the Trans Pacific Partnership. To do such deals we need to be free to make our own calls on regulation, tariffs and non tariff barriers. Through our membership of the WTO we can create relatively friction free trade, as we enjoy today on non EU trade, with the added advantages that trade deals can bring.

The fourth and biggest win of all is we will re establish our home democracy. Our laws will be made in the UK, and can be repealed or improved by Parliaments we elect and influence. The UK will regain her vote and voice in a number of world bodies, including the World Trade Organisation and various standards bodies, so we can have direct influence on world regulation.

Any deal worth accepting has to be better than this.  It would need to be a  very good offer indeed to be worthwhile paying them £39bn more.