Brexit: Enough David Brent, this is serious!

A few years ago, I was listening to a talk by a coach and motivational speaker who was extolling the virtues of positive thinking and the new empowered, non-hierarchical, collaborative workplace. I said that, while I loved his wonderful image of the future of work, I didn’t see much evidence of a trend in that direction. We had been talking about these things for twenty years, yet command and control was still the norm in many industries and technology was making some workplaces more regimented than ever. Not to mention the people on various forms of precarious contract at the whim of their managers.

His response was that, by choosing to focus on such things, I was displaying my negative mind-set. I was filtering information according to my preconceived ideas and refusing to allow in the positive and hopeful future. See what he did there? He turned his complete lack of supporting evidence for what he was saying into my problem. It was me being negative, not him ignoring the data.

Alas, the cod-psychology of self-help and motivational mumbo-jumbo has seeped into the Brexit debate. Leave campaigners are telling anyone who raises concerns about Brexit to ‘be positive’, ‘just get on with it’ and, my personal favourite, ‘move on’. It’s the sort of language adopted by managers who want to railroad a project through and don’t want to hear the staff tell them it might go wrong.

But just get on with what? Move on to what? I’m as happy as the next person to move on if it’s clear what we are moving on to but, at the moment, we have no idea. We might have voted against the EU but what did we vote for? The government should have had a plan, say the Brexit campaigners. (There it is again; turn your own failings into someone else’s problem.) But it is difficult to see how anyone could have planned for this, especially when we don’t know what ‘this’ is. “Brexit means Brexit,” said Theresa May, which sounds decisive but is anything but because Brexit can mean all sorts of things.

I have managed any number of change programmes over the years, consisting of multiple but mutually dependent projects. When I look at this, though, I wouldn’t even know where to start. I tried to draw a diagram of the various options but I gave up because each one of them has so many potential permutations and stumbling blocks, each dependent, in turn, on the political pressures on many different actors.

Just deciding the UK’s starting position is going to be difficult enough. Most business groups are adamant that the UK should retain its membership of the single market while a lot of those who voted Leave did so on the assumption that, after Brexit, free movement of people from the EU would stop. At the moment, EU governments and, perhaps more importantly, their voters, are very reluctant to offer the UK a deal that allows both.

Eurotrack EU trade-01

The next diagram* shows the various relationships that different countries have with the EU. Broadly speaking, the further right you go, the more control you have over things like regulation and immigration but the less favourable the trade terms get. Switzerland, for example, is being threatened with reduced market access if it goes ahead with its plans to restrict immigration from the EU. Beyond the red circle, you leave the EU orbit altogether and either negotiate free trade agreements with the EU or trade under WTO rules. (More on this later.)

CnT6pwVXEAAI2f2.jpg-large

We start from the point, then, that there is no consensus in the UK about what Brexit should look like. Going into a negotiation without knowing what you want and hoping it will become clear as you go along is really not a good place to start. Ideally, to satisfy everyone, we would need to have Norway’s single market rules and Canada’s right to restrict migration from the EU. It is very unlikely that other EU countries would agree to that.

Even if we can agree a starting point which a majority of people in the UK might accept and which would not trash our economy, the negotiations are likely to drag on for some time.

As Bloomberg reported earlier this week, each EU country is drawing up a shopping list of the things it wants and doesn’t want from Brexit. Some positions are defensive, others are looking at exploiting the opportunity, such as Luxembourg going after London’s financial trade and Spain grabbing Gibraltar. Against this background, just agreeing an EU-wide position will be difficult enough and it is something over which the UK has very little control. There will be negotiations nested within horse-trading nested within more negotiations.

Then there are the negotiations with those outside the EU to consider. The UK will have to re-negotiate its membership of the World Trade Organisation. Again, this could be subject to a veto from any one of the other countries. The head of the WTO has warned that such talks are likely to be long and tortuous. And all this before any bilateral trade deals can be agreed.

The simplest option would be to leave the EU and remain part of the European Economic Area (EEA). The plug-in-and-play option is always worth considering when planning any major change. The consequences of leaving the single market (as opposed to leaving the EU) were not really discussed during the referendum. This piece by Ben Kelly, a pro-Leave campaigner advocating the EEA option, goes into some of the detail. It’s not just tariffs that are the problem, he says, it’s the non-tariff barriers too.

At the moment, all goods produced in the UK are assumed to be compliant with EU rules. That is the point of the single market and all that horrid EU regulation. But the moment we leave the EU, we will no longer be part of that single market so our goods will be produced outside the regulatory area. Once the UK leaves the EU, therefore, the EU will have to start inspecting all UK exports in the same way it would goods from any other country. As Ben Kelly explains:

The great benefit of the Single Market is that border checks have been eliminated; facilitating free trade. The common rules are monitored by relevant national authorities and there is mutual recognition of standards. This makes it possible to load a lorry in Glasgow and ship goods all the way to the Turkish border with little more than occasional document checks.

If we leave the EU and the Single Market without negotiating an agreement to replicate these benefits, this all stops. The exported goods may still comply with exactly the same standards, but the testing houses and the regulatory agencies are no longer recognised. Thus, the consignment has no valid paperwork and is subject to border checks, visual inspection and physical testing.

In practice this mean the shipment is detained while samples are taken to be sent to an approved testing house. With a container inspection costing approximately £700, and detention costs running to around £80 a day for ten days or so it takes to get the results back, plus a testing fee, exporters are paying over £2000 just to deliver a container to an EU Member State.

This would have serious economic consequences. The delays would be devastating. Supply chains across European industry are integrated, with many working on a “just in time” regime. This means that any delays even to a small number of consignments will have an adverse effect on the whole system.

So the ‘just get on with it and leave’ option would be extremely dangerous. If we found ourselves outside the EU without a trade agreement we would be in big trouble. Advocates of the WTO Option, the default of simply leaving the EU without any agreements, claim that the US, China and Australia have no trade agreements with the EU yet freely trade with it. But all these countries do have agreements with the EU on regulation. These Mutual Recongition Agreements (MRA) recognise each other’s regulatory standards thereby reducing the amount of inspection needed at borders and simplifying customs procedures. Regulatory regimes are a bit like traffic lights and road markings. They help things move more quickly. If you got rid of road rules, traffic would grind to a halt. If the UK quit the EU’s regulatory framework without negotiating a MRA, something similar would happen to our trade with the rest of Europe.

Even the EEA option would not be without its problems though. We would be left with similar rules on free movement, which a lot of Leave voters would see as a betrayal, and there is no guarantee that the other countries involved would agree to it anyway. As constitutional law professor Michael Dougan says, there are 32 potential vetoes over the UK’s membership of the EEA; the 27 other EU countries, the 4 EEA countries and the European Parliament. Norway is already threatening to block the UK’s EEA membership.

There really are no easy answers here. The idea that we can just walk away from the EU is utter nonsense but all the other options are complex. The length of time they will take and the resources needed to bring them to a conclusion are impossible to forecast.

Which brings us to the final piece of the problem – resources. As anyone who has ever run a major project will know, being clear on the objectives, tasks, dependencies and sequencing is only half the battle. You then have to secure the resources to do it.

In another announcement that barely made the news, National Audit Office boss Sir Amyas Morse warned that the government doesn’t have the spare capacity to carry out all the extra work that leaving the EU will bring. This, he said, is not just a matter of capability:

We will have set civil servants a Herculean task and set them up to fail. And none of us can afford that.

Please don’t misunderstand me, I am not joining the clamour pointing to our lack skills in trade negotiation.

My point goes further. If that were the only issue, we’d be relatively well placed!

Brexit, he concluded, will have to be prioritised with consequences for all other major government projects. In short, without a significant increase in the size of the civil service, just about everything else will have to be scrapped.

With no clear objectives, an incalculable number of dependencies, unfathomable sequencing, timescales impossible even to guesstimate and depleted resources, any project planner might be forgiven for throwing in the towel. Some sort of plan will emerge eventually but, at the moment, just making one for the project’s first phase, defining what the hell it is we want, is going to be difficult enough.

So spare me the pseudo psychology and the David Brent-isms. Trite phrases like ‘move on’, ‘be positive’, ‘just do it’ and ‘we are where we are’ reflect a failure to understand the magnitude of the Brexit task. There’s no ‘just’ about any of this. It is a colossal and eye-wateringly complex task. It will take years and will dominate UK politics for the rest of the decade.

*Update

The chart above is not a Venn diagram. It is simply an illustration of the levels of trade integration with the EU but, as some people have remarked, it simplifies the nuances of the countries relationships with the EU. The EU is not a subset of EFTA and EFTA is not a subset of the Customs Union.

This one from a recent EFTA report (which is an interesting read) shows the varying relationships and agreements between European countries, including those that are not related to trade. Turkey, for example, is a member of the Customs Union but not of the EEA. Norway is a member of the EEA without being in the Customs Union.

Screen Shot 2016-08-12 at 12.47.30

There is a discussion of the pros and cons of each option in this FCO report from earlier this year. The Institute for Government has a useful one-page explainer.

At the moment there is no provision for countries to become part of the European Economic Area without either being in the EU or EFTA, as this useful FAQ page on the EFTA website says. As some people have pointed out, it would, at least in theory, be possible for the UK to negotiate a similar arrangement without being an EFTA member and to lob in some restrictions on immigration too. It looks unlikely, given current political and public opinion in the EU, that there would be much support for such a deal.

Confused? You will be… and this will all drag on for some time.

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68 Responses to Brexit: Enough David Brent, this is serious!

  1. Heh!

    Is Brexit the new Universal Credit? A promise of future sunlit uplands that never seems to happen!
    And if Brexit is attempted then Universal Credit may even be displaced. Many claimants, actual and potential, may welcome this.

    Poor old IDS! The Leave campaign, of which he was a supporter, has probably scuppered his pet UC project! Let’s hope he can “Move on and Get over it”

  2. Dipper says:

    I’m a Leaver, as you know, but if we are having a stupid competition let me make a case for that award going to the Cameron government and the MPs who voted 6 to 1 in favour of a referendum.

    The gist of your argument is that to all practical purposes leaving the EU not a viable option. The task required to Leave is beyond us and the outcome too uncertain and in all probability worse than continued membership. Its a complete car crash.

    So, what the government did is to offer a Referendum with only one possible outcome. And in doing that, it completely eliminated our negotiating position in Europe. The UK government would then have been in a position when we would not have been taken seriously in Europe as at any stage our bluff could have been called safe in the knowledge that if push came to shove we couldn’t leave. We would have been completely railroaded by an EU commission that has demonstrated over and over again its complete disregard for any opinion other than its own. In the words of a friend of mine who I hadn’t spoken to prior to the referendum, I voted out because if you play your nuclear option you have to use it.

    Much of the Remains complaints amount to the fact that the status quo was good for us. But the status quo went the moment the referendum was called, so your arguments are not arguments against Leave, they are arguments against having a referendum in the first place.

    • CHF says:

      Even without the Referendum, the EU was never offering a “status quo”: it was onwards towards further integration with the same approach that had (lest we forget) severely damaged several major economies and obliterated several more. Cameron’s agreement (subject to ECJ interpretation) gave the UK some opt-outs, in exchange for the loss of an important veto, but those historically have been easily reversed. Even if they weren’t, it wasn’t clear how the UK would fare inside a large group as a bystander, with political power moving elsewhere. That would be countered to some extent by the UK’s being a large net contributor (see below), but as more of the EU budget and institutions were absorbed by Eurozone integration, that was only likely to bring its own political problems. If anything, the Referendum result reflected the political reality of continued life in the EU, without even the external control that (say) Norway in the EEA can exert at international level, a control denied the UK by the original EEC treaty.

      As regard “agreeing an EU-wide position will be difficult enough”: the political reality in the EU is that only a few member states actually matter, even more so since the counterbalancing UK is leaving. The usual rule? “Follow the money”

      • Callum says:

        Right… so that’s what you are against. Still waiting to hear what it is you are for and why that position won’t be considerably worse than our current or postulated future status within the EU would have been?

        To make it a perceived contest between bad and bad one surely still has to have some justification as to why their side is the less bad of the two (or five) options…

      • So by “Cameron’s agreement” you mean this one, at 11:50:58, which Prof Dougan says “was a legally binding set of principles to govern the relationships between the single market and the Eurozone…very important, very valuable, the people who rubbished that deal should frankly be ashamed of themselves”.

        http://www.parliamentlive.tv/Event/Index/cb083c53-3998-4f3a-8eca-e114e3dbdf0b

        Do you mean this agreement? If so can you provide a legal expert to counter Prof Dougan’s position?

        Whilst we are at it, can you give examples where EU policies damaged (or obliterated) otherwise healthy EU economies?

        • CHF says:

          I think you’ll find that the management of the Euro has led to results (for instance in youth unemployment, but more generally) in the Spanish, Italian, Portuguese and especially Greek economies, and to some extent in the French, which are not entirely consistent with past performance, and certainly they had more options then.

          • I said “damaged or obliterated otherwise healthy economies”

            Most of the economies you mention, especially greece, were not “otherwise healthy”. The Euro (rather than policies) did not help, but Greece for example has historical systemic issues in terms of tax avoidance, protected industries, excessive protectionism and other problems.

            I’m not saying the EU is without fault but many of these countries had difficulties unique to themselves. The Euro in hindsight was probably stupid and the Eurozone will have to work hard to fix it’s problems but we are not in the Eurozone.

            I’m also interested in why you dismiss so easily the deal struck by Cameron?

          • George Carty says:

            Greece was fundamentally screwed by its own geography, although this only became apparent when the end of the Cold War meant the Western powers no longer had any reason to subsidize it.

      • Nick Poole says:

        CHF just to note that it wasn’t the EU that ‘damaged several major economies’, it was the cost of bailing out banks who, in a state of deregulation had bet their shirt on increasingly exotic derivatives to maximise profits and failed to notice or account for an inevitable wave of defaults. This triggered a global credit crisis which acted as a shock wave on national economies across Europe. While you could argue that monetary Union inside the Eurozone gave the big nations carte blanche to exert leverage over weaker economies, it is simply wrong to suggest that the EU caused the crisis or deepened it’s impact. People genuinely appear to have forgotten that the root cause of all of this, and the resulting inequality and collapse in real-terms earnings, is a direct result of the wilful and uncontrolled actions of a few major financial institutions.

      • Sovereignty says:

        I believe the fact the EU has been unable to agree (unsurprising since 28 countries’ national and regional parliaments must agree unanimoulsly) even the most uncontentious trade deals (with tiny exceptions) it seems no trade agreement will be done at all, even with no acrimony and great goodwill on the side of all 28 participants. In common with almost every other country outside the EU we will find trade in goods quite painless under WTO terms. The US, Canada, China, South Africa, Australia etc. etc. all seem to manage OK, and so does the EU in reciprocation. We can hang on in there until we have fixed up the few deals which we believe are currently more advantageous as a member. We can then leave. Using Article 50 is of course an option (if that suits us) but it is far from being the only way to lawfully exit the Union, despite everyone in the EU saying it is. The Treaty of Vienna for instance permits cancellation of the various other treaties, quite properly, within 90 days.

        With respect to Services (not covered by the WTO), mainly passporting of the City of London, that is a matter for the EU. If they want to restrict trade yet further and damage our National Champion (as the French refer to it) they can to some extent but it is not a decision they are obliged to make. Were they to percieve it in their best interests to allow free trade in services they could do so. Why would they? Realpolitik. It is entirely within the WTO rules to penalise goods which are price-dumped (as the US has just done in May on Chinese steel, slapping a 500% tarrif on it, quite lawfully). We are not the only people with National Champions, the French have their agriculture (the French Farmers)and the Germans their automotive, representing 12% of their entire economy (more if you count the supply chain). Both are ripe for tarrifs for unlawful (unless you happen to have signed up for the Treaty of Rome which gives the Germans a specific exemption to provide cheap state financing and control (through Golden Shares) of their car industry), and the Common Agricultural Policy is so obviously blatant state aid it needs no elaboration.

        Tempers will subside at impudence of Britain for operating a democracy, and simple self-interest can be made to convince the Usual Suspects in the EU that if they knock our house down, we will return the favour with interest. Ideally such discussions should be conducted in strict secrecy to avoid panicking global markets. Then we can all get back to being good neighbours once again.

        I believe Britain has been democratic, not bullies, but neither are we Greenland nor Latvia, we are not economic pushovers to be ‘punished’ for respecting the democratic process.

    • Jim H says:

      Agreed but more they arguments NOT to vote Leave in said referendum aren’t they?

  3. Stephen says:

    Excellent article and well written. But isn’t this kind of the point of many people including the official vote leave position that he EU is undemocractic and uncompromising.

    Any organisation that hurts itself to ensure the UK doesn’t get a good deal is an association we should run a mile away from. It all stems down to the fact the man at the top is unelected by the people and the EU nations *can really look after their own affairs and do their own deals without the need for this lumbering mass of regulations called the EU.

    • Ian Stirling. says:

      But the individual members are not hurting themselves in order to punish Britain. They are looking after their own particular interests.

      • Precisely. With respect, one of the primary issues with the Leave campaign world view is that the UK should get exactly what it wants and that anything else is the EU being “inflexible”. We are not negotiating with the EU as a single entity but with 27/31 countries all with their own interests and many of whom have a trade deficit with the UK. Frankly we have opened a can of worms and issues such as Gibraltar, financial passporting and others which previously were just background noise are now up for grabs.

        No offence, but exactly who is being “uncompromising” here? We drove the single market, we pushed for expansion of the EU into Eastern Europe, we even paid for some of it, and now 10 years later we are using Eastern Europe as an excuse to leave, our completely bespoke EU deal isn’t good enough for us (though the “standard” deal is good enough for 27 other countries) and what’s worse, we don’t even know what we want, we just want ‘out’ – without defining even the broad outline of ‘out’.

        There is only really one “Uncompromising” player in this game.

    • Callum says:

      And yet you don’t seem to get it at all. It’s hard to negotiate a satisfactory exit, not because it’s undemocratic or authoritarian or impossible to get out, but because there are no options that are better… which rather leads one to the conclusion that the EU is in fact a good thing!

    • Pio Díez says:

      It all stems down to the fact the man at the top is unelected by the people………same as Queen Elizabeth, the Pope, King Felipe of Spain, Saudis, Jordanian, Marrocan Kings and so on. No UK’s Minister has been elected by people. May has not been elected by people same as Mr. Renzi. EU Commission has been elected by 27 elected people. They just delegate.

  4. I agree with your rubbishing of the trite phrases.
    I feel that the level of debate around Brexit has been poor. It has been poor in the negativity on both sides. The leavers concentrated on how awful the EU is and on how we risk becoming overun by immigrants. The remainers concentrated on the negative aspects of leaving the EU – recession, rise of the right wing, and all sorts of other catastrophe. This negativity has then continued after the referendum and in your blog. Yes, it will not be an easy task, because the levels of bureaucracy and mountains of redtape are high. But focusing on the hurdles that each option has, and finding a quote from another ‘expert’ that backs up the negative opinion can only cause delays and support the bureaucrats in their endless paper pushing.

    So – just to try and put a bit of a positive spin on things, working backwards from your diagram:
    WTO:
    Australia: I have worked with Australians and lived (when in Earls Court) cheek by jowl with them – I have bought their beer, been driven in an ambulance by one (for my son). I also seem to get an awful lot of lamb from their New Zealand neighbours.
    Japan: I have a phone, TV and other electrical equipment from Sony.
    America: I have an Apple iPad, use Google and other US tech companies, watch American TV and films, occasionally buy junk food in supermarkets and restaurants that is either american or from an american company.
    China: Hard as I try not to buy too many things from China my house has probably more FMCG stuff from China than from the EU.
    Would WTO rule really damage all trade so much? And as we have already been trading with the EU from before we even joined can it be beyond the wit of man to arrange MRA without torture?

    Rather than to go into too much detail here is another positive thought: Norway, Switzerland, Denmark, Canada, Iceland, New Zealand, Switzerland and Sweden (none of whom are in the Eurozone, and some outside the EU) feature closer to the right end of the tables of economic growth, happiness, youth unemployment, and inequality than many of the other countries featured in the Eurozone. As these more successful countries come from both inside and outside the various Euro areas perhaps we can postulate that the growing of a happier country is not exclusively dependent on whether we are a member or not of these clubs. It is more likely dependent on other positive and progressive moves by their society and government. Maybe we should spend more time identifying what these policies are and adopting them, rather than analysing the downside of everything we are part of, of what we might do, and of what we are leaving.

    • ... says:

      your post is just a wordier version of the “it’ll be fine” rubbish. if it’ll be fine, tell us how it’s going to happen. you pick a few anecdotal truths from your life and extrapolate these into a theory that life will go on as normal, trite and delusional,

    • Florence says:

      The Scandinavian countries are not high on measures of lifestyle and well being because of their status regarding the EU. They are there because they are high tax, high social security economies, with high levels of education, high skills jobs and higher pay.

      The UK on the other hand ranks equal to Greece on falling wages, and social misery. Not because we are both part of the Eurozone, which only Greece belongs to, and not because we’re both part of the EU.

      We are part of the race to the bottom because both Greece and the UK have experienced full blown neoliberalism. In Greece’s case, it was forced on them by the ECB and the German banks, because they have no idea what they are trying to do, but following the cook-book solutions, which consist of making the situation worse.

      In the UK it’s because we have a government (and in part an opposition) who are also following the cook-book of neoliberalism because they want to. They say There Is No alternative. Funny, because there actually is, and now the IMF and the World Central Bank have recognised that neoliberalism is a journey in to economic oblivion it’s time we threw off these “choices”. It’s just a shame that this has become for many synonymous with the EU Brexit debate, because like so much in the debate, it was smoke and mirrors designed to hide the disastrous mis-management of the UK economy for decades.

    • Rob2000 says:

      Re-read the part of article which deals with the countries that trade with the EU supposedly using only WTO commitments. They don’t. The EU and these countries have extensive MRAs and agreements covering conformity and testing. It is these agreements that allow you to buy electrical equipment from Sony, your films and Apple products from the US and all your stuff from China. When we leave the EU, we leave those agreements behind.

      Now, that might not be a problem for you if you still want to buy stuff from China and other places. The UK government might simply have to relax import controls and not demand proof that imported electrical items won’t catch fire, or children’s toys don’t contain lead, but the real issues come for anyone in the UK trying to export to the EU, or indeed, anywhere else. The country you are trying to export to might simply say ‘we have no way of knowing if these products comply with our standards, they can’t come in until they have been tested and shown to be compliant’ and that is where the problem lies.

    • No offence but I think that was a fairly comprehensive drubbing your post got. The first poster has it exactly right, all you are really saying is a longer version of “it’ll all be fine if you remainers stop whining and we all roll our sleeves up”.

    • You’ve bought their beer… Did you really, beer from Australia or did you buy beer produced in the EU with a license to use an Australian brand name? Same for almost everything you list, the company structures, tax and legal entities are almost certainly set up in such a way that almost nothing you list was actually from a direct foreign entity that is outside the EU.

  5. Stephen says:

    Dismissal was the Leave campaign’s response to every evidence-based argument, and the reflex persists. But whatever the eventual negotiated outcome, the certain damage of a long and drawn-out investment limbo shouldn’t be underestimated.

    My own unhappy prediction the morning after the vote was that we’d eventually survive with a deal little different to what we had before, but that Britain would be cut down to size in the process. My hat is off to canny Theresa May for putting Johnson, Fox and Davies in key roles to take the fall for it.

  6. Nick says:

    It isn’t just trade. It’s also the question of contributions and access to EU R&D funding and facilities. As the Swiss have found out, participation in the Horizon 2020 funding scheme requires free movement of individuals.

    • CHF says:

      It indeed requires free movement of individuals connected to the programme; it doesn’t require a blanket licence to migrate. The original “free movement” that was one of the sections in the EEC treaty was much more restrictive than the 20-year-old EU Citizen’s Directive.

      • CHF says:

        I’ve participated in lengthy significant US research programmes without requiring essentially unlimited “free movement” into the US; not even a Green Card.

  7. telescoper says:

    Reblogged this on In the Dark and commented:
    Interesting discussion of the complexity of the task facing BrExit negotiators. It will probably take a very long time even to work out what we want, let alone finalise the details. Perhaps in that time as the economy slides further into recession the good folk of the UK will realise it was all a very bad idea. But will we ever get the chance to reverse the referendum result?

    • Sovereignty says:

      “But will we ever get the chance to reverse the referendum result? “.
      No.
      It was clearly labelled as a one time event, not as some people now seem to imply, ‘surely it’s the best of three?’.
      You may be entirely certain that had the UK voted to Remain there would be zero chance of the sore losers in the Out camp’s complaints leading to a re-run. The matter would have been ‘decided for a generation’. The same rules apply when the vote goes the other way..
      The task now is to find the best way forward, not to re-run the campaign.

      • telescoper says:

        Nigel Farage said explicitly that the leave campaign would continue in the event of a close remain result. The referendum was in any case without any legal or constitutional force.

        When the extent of the damage already being done by BrExit becomes clear then I believe there will be overwhelming support for abandoning the plan.

        It’s not just the economic problems it will cause, but the end of the peace process in Northern Ireland, the loss of Gibraltar, independence for Scotland, etc, etc.

        I do not think the campaign should be re-run, but whatever specific alternative to the EU membership is proposed should be voted on, at which point people will realise it is clearly worse than the current arrangements.

  8. Perhaps David Brent does have a point… What an incredibly negative article. Yes its going to be hard, probably tortuously hard but it doesn’t mean a decent deal (whatever form that takes) is achievable. Norway type of deal would most likely suit me (which incidentally is outside the customs union contrary to what you say) – I’d imagine with some explanation to the public, a doable deal.

    • Rick says:

      I didn’t say Norway was in the customs union.

      • Hi Rick – The diagram does.

      • coward says:

        The EEA (Norway option) is often portrayed as the second best option to the EU…. Essentially the single market minus some influence plus some freedoms (eg WTO membership and the ability to strike its own trade deals)

        However thing that is overlooked is that Norway isn’t fully in the single market. It adheres to regulation but the EEA membership doesn’t allow for custom free movement of agricultural products. Also anything manufactured in Norway with significant components from a third (non EU) country may be subject to tariffs (to stop Norwegian companies using their unique trading status to their advantage).

        Obviously this doesn’t mean that EEA might not be better than the EU for the UK. But it’s difficult to see how we can keep an custom free border with Ireland or how UK food exports to the EU won’t be hit hard …. Even trade deals with rest of world which help and UK businesses could result in extra bureaucracy for other businesses ( document their components and tariffs paid) when exporting their main EU markets.

      • hidden says:

        Terms such as “single market” and “customs union” are badly abused in the debate by all sides (largely to the benefit of leave). Norway is commonly described as being in the single market. In reality it adheres to much regulation for easier market access…. But this isn’t comprehensive access and comes with extra red tape.

        Agriculture and food products are not covered by the EEA meaning significant tariffs on some of these exports. Meanwhile because they have different external tariffs (due to their own trade policies outside the EU), any manufactured exports are subject to complex origination rules (ie you need to prove that you didn’t source the parts cheaper due to different tariffs than an Eu competitor).

        All of this means:
        1. A tariff barrier with Ireland (and big challenges in northern Ireland)
        2. Extra bureaucracy on manufacturers particularly if they are in complex supply chains
        3. Big challenges for agriculture and/or more expensive food in the shops or mostly likely a combination of both!

        …. And this with the easy EEA flexcit option

    • Graeme P says:

      And whilst it’s hard very hard you put forward precisely… Oh I know nothing. Gee thanks David Brent

    • Detlef says:

      Norway:
      – accepts free movement of people.
      – contributes money into EU funds.
      – implements between 20 – 30% of EU laws and regulations.

      I seem to remember that the Brexit supporters campaigned against all three? How are you going to “explain” such a deal to the public?

      The main export from Norway to the EU are energy supplies (oil and natural gas). British exports to the EU are mainly services and goods. So I´d assume that Britain would have to implement a higher percentage of EU laws and regulations? Given the larger range of exports?

      Essentially you would have most of the duties of a member without any voting (and veto) rights. Even if you can explain that to the British public why do you feel that this is a good deal for Britain?

  9. Boursin says:

    The discussion of border checks above makes me mention (with a rueful little laugh) something that may be relevant.

    Living in one of the happy-happy Nordic countries, I order a lot of stuff from small businesses in other EU countries by mail: from sellers on eBay, on Amazon, etc. etc. etc.

    And the thing is that AT LEAST ONE THIRD of all small businesses in the UK from which I buy, FILL IN A FULL CUSTOMS DECLARATION, and have consistently done so for the past 20+ years I’ve been buying. Although the goods are of course not subject to any duties or taxes whatever, and will not pass though customs on their way to me.

    Similarly, when I make inquiries about an overdue delivery, the first excuse I hear from UK small businesses, more often than not, is: It’s surely got stuck in the customs somehow!

    This, by the way, includes many businesses such as antiquarian booksellers, who do not exactly have a reputation for ignorance, boorishness, or Little-Englander insularity.

    And guess what? By contrast, of the several hundreds of small businesses in EU countries OTHER THAN THE UK that I’ve bought from, only two (one from Italy and one from the Netherlands) have so far filled in the superfluous customs declaration. Make of that what you will.

    • bichatse says:

      Having sent things overseas from the UK on many occasions, let me enlighten you. The customs declaration usually happens at the post office, where the conversation with the person behind the counter generally goes something like:

      “Oh, if it’s going overseas, you have to fill out one of these…”

      “But I’m sending it to France – we have customs union with France!”

      “Do we? Well, I think it would be best to fill it out anyway. Look, the form even has French on it.”

      ” – Fine. If it makes you happy.”

      “You can’t send something overseas without filling in a customs form.”

  10. There seems to be a pattern emerging:

    1. Perpetual deficit reduction although we were told it would be done in 5 years; (Osborne)
    2. Perpetual Universal Credit roll out although we were told it would be done by now; (IDS)
    3. Perpetual Brexit negotiations although we were told it would be straightforward (Boris et al)

    Does anyone else suspect this and the former government has overpromised?

    Or as Rick says, that they live in La La Land?

    • guthrie says:

      Why am I suddenly imagining the biggest jobs for the boys (and girls) creation scheme in the history of Britain?

  11. gunnerbear says:

    Perhaps the author of the post might not wish to waste time reading Kelly….I strongly suggest that the author keeps an eye on this site…it’s where Kelly / IEA get their information from… http://eureferendum.com/default.aspx

  12. David Lilley says:

    Dear Flip Chart Rick,

    I have a different take on Brexit. Whilst David Cameron had no choice about holding a referendum for reasons going back about ten years we should never have another. We want to be ruled by the best argument and not the majority. J S Mill described majority rule as the worst kind of tyranny and “vulgar democracy”. Imagine if the result had been to remain because London, Scotland and NI had voted unanimously for remain.

    The for and against arguments were far removed from the quality of the debate and scrutiny enjoyed in parliament. By luck and not good problem solving we arrived at Brexit. And when Mrs. May says Brexit is Brexit she is only stating that its a done deal. Lets go forward please and stop looking backwards with regret. History is bunk. You can do something today and tomorrow but you cannot do something yesterday.

    The EEC morphed into the EC and then the EU and thanks to the introduction of the Euro must now morph into a banking, fiscal and political union with considerable future loss of member state sovereignty that we can do without. Without some thinking it will go forward with Nexit and Frexit.

    The EU is a club with member benefits that are unequal. Great for the 2004 accession countries. Great for those who have a net financial gain rather than a net cost. Bad for free trade and globalisation. EU protectionism looks after themselves but is generally negative for the rest of the world. Their biggest spend prior to the PIIGS was the CAP (Common Agricultural Policy) which massively subsidised their farmers to avoid importing agricultural produce from the rest of the world. The EU citizen paid tax to fund the CAP and over the market rate for fruit and veg which could have been bought from the third world for example. A consequence of not trading with Africa is that Africa is poorer and its citizens have little choice but to travel to Libya and face crossing the Med.

    Trump will put the UK at the front of the queue in an Adam Smith free trade world. TIPPS is destined to fail. China is totally frustrated with negotiating with the EU and a number of countries have come forward and requested that they wish to trade with the UK including Assie, NZ and Brazil. We also have good relations with the Commonwealth and the other European trading block that we had to leave when we joined the EEC. The pre 2004 EU had an average age approaching 60, a declining workforce and even when enlarged it only holds 17% of world trade and falling. The EU cannot say goodbye to UK trade which is massively to their advantage.

  13. P Hearn says:

    The choice put to the public was ever-closer union, unlimited immigration, new entrants lining up to join the EU and more harmonisation from the not-at-all-corrupt Brussels machine.

    Can’t think why anyone would have voted against that, whether or not there was another plan articulated. The benefits are so obvious, it’s hard to see how 52% of voters missed them.

    • CHF says:

      Indeed, it’s worth noting that although many of the subsequent problems were nascent in the Treaty of Rome, it was only the creation of the EC and then the EU out of the EEC that made them manifest. That disastrous attempt at economic and monetary union, and the attempt at wholesale undermining of the nation state in the consequent Treaties (and abortive Constitution, rejected by several electorates), provoked the referendum and then its result.

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  15. njstone9 says:

    … and it will cost us an absolute fortune.

  16. David Lilley says:

    Dear Flip Chart Rick,

    I have a different take on Brexit. Whilst David Cameron had no choice about holding a referendum for reasons going back about ten years we should never have another. We want to be ruled by the best argument and not the majority. J S Mill described majority rule as the worst kind of tyranny and “vulgar democracy”. Imagine if the result had been to remain because London, Scotland and NI had voted unanimously for remain.

    The for and against arguments were far removed from the quality of the debate and scrutiny enjoyed in parliament. By luck and not good problem solving we arrived at Brexit. And when Mrs. May says Brexit is Brexit she is only stating that its a done deal. Lets go forward please and stop looking backwards with regret. History is bunk. You can do something today and tomorrow but you cannot do something yesterday.

    The EEC morphed into the EC and then the EU and thanks to the introduction of the Euro must now morph into a banking, fiscal and political union with considerable future loss of member state sovereignty that we can do without. Without some thinking it will go forward with Nexit and Frexit.

    The EU is a club with member benefits that are unequal. Great for the 2004 accession countries. Great for those who have a net financial gain rather than a net cost. Bad for free trade and globalisation. EU protectionism looks after themselves but is generally negative for the rest of the world. Their biggest spend prior to the PIIGS was the CAP (Common Agricultural Policy) which massively subsidised their farmers to avoid importing agricultural produce from the rest of the world. The EU citizen paid tax to fund the CAP and over the market rate for fruit and veg which could have been bought from the third world for example. A consequence of not trading with Africa is that Africa is poorer and its citizens have little choice but to travel to Libya and face crossing the Med.

    Trump will put the UK at the front of the queue in an Adam Smith free trade world. TIPPS is destined to fail. China is totally frustrated with negotiating with the EU and a number of countries have come forward and requested that they wish to trade with the UK including Assie, NZ and Brazil. We also have good relations with the Commonwealth and the other European trading block that we had to leave when we joined the EEC. The pre 2004 EU had an average age approaching 60, a declining workforce and even when enlarged it only holds 17% of world trade and falling. The EU cannot say goodbye to UK trade which is massively to their advantage.

  17. philip smith says:

    I’ve run some major corporate change programs but they had effective sponsors who could mandate what should happen. The negotiation angle of this Brexit programme is what makes it particularly tortuous. as there are competing sponsors. Also we spent 40 years binding ourselves to Europe, we should expect that untying such a complex knot will be a massive and long winded task.

  18. “His response was that, by choosing to focus on such things, I was displaying my negative mind-set” – says it all really – I get really fed up at being called negative by people who live in a bubble of self belief but are themselves usually unsuccessful. It is not negative to be a realist – much of the Brexit optimism is already unravelling. An optimist is someone who does not have enough experience …

  19. Can I just take issue with one thing here: “We would be left with similar rules on free movement, which a lot of Leave voters would see as a betrayal…”.

    I’ve seen this argument many times and it always ignores one thing: that 48% of people are either in favour of free movement or, at worst, see it as an acceptable cost for other benefits. Those who voted Remain must, of necessity, not be among those who wish for tighter immigration control at all costs. That leaves us with what fraction for the Leave vote would be happy with free movement, and what proportion was for leave *in order to* control immigration. Because if more than 2% of voters were in the “leave but retain free movement” camp, then free movement is the will of the majority.

    I have seen the proportion of the leave vote in favour of tight immigration control estimated at about 1/3 of the overall leave vote. That may or may not be accurate, but it would mean that only 1/6 of the country is in favour of border control. But even if 2/3 of the leave vote was for border control, those in favour of free movement are still close to a supermajority.

  20. Tony Wright says:

    “I don’t know where to start “. is clearly not good enough for someone who claims to be a change manager. This is clearly a situation which needs a soft systems approach’ as used in “messy” situations . if the author needs further advice I can point him in the right direction.

  21. hidden username says:

    Terms such as “single market” and “customs union” are badly abused in the debate by all sides (largely to the benefit of leave). Norway is commonly described as being in the single market. In reality it adheres to much regulation for easier market access…. But this isn’t comprehensive access and comes with extra red tape.

    Agriculture and food products are not covered by the EEA meaning significant tariffs on some of these exports. Meanwhile because they have different external tariffs (due to their own trade policies outside the EU), any manufactured exports are subject to complex origination rules (ie you need to prove that you didn’t source the parts cheaper due to different tariffs than an Eu competitor).

    All of this means:
    1. A tariff barrier with Ireland (and big challenges in northern Ireland)
    2. Extra bureaucracy on manufacturers particularly if they are in complex supply chains
    3. Big challenges for agriculture and/or more expensive food in the shops or mostly likely a combination of both!

    …. And this with the “easy” EEA flexcit option

  22. David Lilley says:

    Dear Flip Chart Rick,
    I have a different take on Brexit. Whilst David Cameron had no choice about holding a referendum for reasons going back about ten years we should never have another. We want to be ruled by the best argument and not the majority. J S Mill described majority rule as the worst kind of tyranny and “vulgar democracy”. Imagine if the result had been to remain because London, Scotland and NI had voted unanimously for remain.
    The for and against arguments were far removed from the quality of the debate and scrutiny enjoyed in parliament. By luck and not good problem solving we arrived at Brexit. And when Mrs. May says Brexit is Brexit she is only stating that its a done deal. Lets go forward please and stop looking backwards with regret. History is bunk. You can do something today and tomorrow but you cannot do something yesterday.
    The EEC morphed into the EC and then the EU and thanks to the introduction of the Euro must now morph into a banking, fiscal and political union with considerable future loss of member state sovereignty that we can do without. Without some thinking it will go forward with Nexit and Frexit.
    The EU is a club with member benefits that are unequal. Great for the 2004 accession countries. Great for those who have a net financial gain rather than a net cost. Bad for free trade and globalisation. EU protectionism looks after themselves but is generally negative for the rest of the world. Their biggest spend prior to the PIIGS was the CAP (Common Agricultural Policy) which massively subsidised their farmers to avoid importing agricultural produce from the rest of the world. The EU citizen paid tax to fund the CAP and over the market rate for fruit and veg which could have been bought from the third world for example. A consequence of not trading with Africa is that Africa is poorer and its citizens have little choice but to travel to Libya and face crossing the Med.
    Trump will put the UK at the front of the queue in an Adam Smith free trade world. TIPPS is destined to fail. China is totally frustrated with negotiating with the EU and a number of countries have come forward and requested that they wish to trade with the UK including Assie, NZ and Brazil. We also have good relations with the Commonwealth and the other European trading block that we had to leave when we joined the EEC. The pre 2004 EU had an average age approaching 60, a declining workforce and even when enlarged it only holds 17% of world trade and falling. The EU cannot say goodbye to UK trade which is massively to their advantage.

    • guthrie says:

      Dear Mr Lilley, I do think your time would be better used than copy pasting your comment multiple times on someone else’s blog. You could even start your own!

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  24. Dipper says:

    As all Change people know you need to assess proposals against the “do nothing” option.

    The key document for the “do nothing” option is here http://ec.europa.eu/economy_finance/structural_reforms/ageing/demography/index_en.htm. In this document the EU projects the UK population will increase from 64M in 2013 to 80.1M in 2050, an increase of 16M. For comparison the population of London is 8.6M and it occupies a roughly circular area of just over 25 miles in diameter. By 2050 we will need to build 2 Londons. We could do this by taking the area between Cambridge and Colchester for one of them, and between Oxford and Northampton for the other one, so it is feasible but only by concreting considerable areas of England.

    It is likely that this would all be paid for by foreign investors, us having none of our own. So the “do nothing” proposal sees two large cities the side of the current largest city in Europe being built, largely owned by foreign investors and largely housing people from the rest of Europe, and not because of any perceived need from the UK but because people are moving out of continental Europe. Can someone please explain why this is a better plan than leaving the EU?

    • Dipper says:

      No reply here yet from Remainers … and not expecting one.

      The Remainers love to say him much cleverer, more realistic, more reasonable they are than Brexiters. Hence the stereotyping, the correlation of voting to Leave with reactionary views, the many analyses of how bad the outcomes are, all with the implicit assumption that the EU is a thing of reasonableness where like-minded professionals meet to agree sophisticated policies for a better Europe.

      The problem with all this is that the EU is not like that at all. The EU commission has grandiose visions it implements in despotic style. It undermines national democracy, it commands, and it punishes refusals. And it has a document describing how millions of Europeans are going to move to north-west Europe whether you like it or not.

      So the only way Remainers can get round this figure of 16M is to say its not real. Its just a projection. It’s not meant to be taken seriously. Its not policy. But it is there, in red and blue on the EU website.

      Or they can just ignore it.

      • Jake Staines says:

        Generally, it’s my experience that people who decry opponents for not responding quickly enough for their tastes often don’t have a very solid point to defend.

        What exactly do you expect the population of the country will be in 2050 if we aren’t in the EU? Because if you plot a graph of the UK population over time – from the 19th century right through to present day – then even ignoring the recent period of free movement, 80 million in 2050 doesn’t really look that much like an outlier. It’s barely above the line of best fit. Sure, the population will doubtless be higher in 2050 if we continue to allow free movement amongst EU states compared to the figure for completely closed borders – but the population will still go up significantly by 2050 with completely closed borders, as well, unless the UK starts practising a China-style population control programme.

        And this is not to mention that we *need* inward migration. The other point made in those same EU statistics – which is readily apparent without them as well – is that our population is generally getting older. People are living longer – which means that we need to do something to expand the tax-paying workforce in order to pay their pensions, amongst other things. It’s telling that over the past year over half of the net migration to the UK was from outside of the EU – immigration that the government could more-easily have controlled and prevented, and chose not to *because we benefit from it*. The notion that immigration is bad for the country is largely a xenophobic/racist myth propagated by sensationalist newspapers.

        And of course, there will be no new cities the size of London – that’s just alarmist scaremongering. As with every other population increase we’ve seen, it will be absorbed by many different towns and cities in terms of a gradual expansion of each, not a sudden massive new building project. The national population has increased by the size of London numerous times before, and we have yet to build a new city the size of London anywhere. Yes, we’ll need to build more houses; we’ll need to build more houses regardless of whether we let foreigners come and live here or not. The housing problem is more related to profiteering by housing companies than any “immigration crisis”.

        TL;DR we’ll just put them all in Scotland. Scotland’s empty, it’ll be fine. Immigration is necessary because it gives us better ethnic restaurants and cheap car washes.

        • P Hearn says:

          In fairness to the Scots, Nicola Sturgeon has indicated she’s fanatically pro-EU. One can only assume that any and all immigrants wanting to settle in the UK will find a warm welcome waiting north of the wall.

          At least that’s one dilemma solved.

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