On 23 January 2013 David Cameron gave his (in)famous Bloomberg speech during which he announced his intention to hold an in-out referendum on the UK’s membership of the EU. The intervening decade has been a difficult one. Looking back over all this time, the speech might be viewed as the starting gun for a process which led us through four prime ministers, including the incompetent Boris Johnson and the hapless Liz Truss, and the steady erosion of trust in the political process.
However, in some ways what Cameron said in 2013 needed to be said. We should remember that at the time the euro area was in the throes of a debt crisis which came very close to scuppering the single currency project. He called for enhanced European competitiveness by extending the single market; a flexible structure which "can accommodate the diversity of its members"; allowing "power … to flow back to member states" and enhanced democratic accountability and fairness so that “whatever new arrangements are enacted for the eurozone, they must work fairly for those inside it and out." There was in 2013 a growing sense that the EU was disjointed and unsure about how to proceed and it was important to ask the right questions which would allow it to get back on track. Moreover, as I wrote at the time, “the speech also gave a reasoned and rational account of the benefits of staying within the EU, notably the enhanced influence which it gives the UK on the global stage, and the benefits to jobs and growth arising from the huge FDI inflows which have come from the EU.”
But Cameron’s relationship with the EU was fractious. He was not a committed player and was unable to reach an agreement with the other members that would allow him to land the killer blow to knock out his domestic anti-EU opponents. Consequently, he left the door open to the “fruitcakes, loonies and closet racists” associated with UKIP who went on to run a campaign that knocked the Remainers for six. Unfortunately, the promises made by those intent on winning the Brexit referendum at any price now lie in ruins. Who can forget the pledge to use the £350 million per week that would be saved by not having to contribute to the EU budget to improve the NHS? Not only was that figure a gross distortion (pardon the pun) but it ignored the fact that part of any funds not sent to Brussels would have to be devoted to those areas that the EU previously funded. Consequently the NHS got very little extra cash, despite being protected from the worst ravages of George Osborne’s misguided austerity programme. It is hard to imagine that the NHS could be in worse shape than it is today without actually collapsing. Admittedly the pandemic placed great strains on the system but the fact that it was underfunded long before Covid struck has been a bigger contributor to its current dire predicament.
No shelter from the fallout
The fallout from the Brexit process has had a profound effect on Britain – on its unity, identity and its place in the world. Having taken a close-run, non-binding referendum and imposing a winner-takes-all outcome the government failed to unify the electorate around a strategy to take the UK forward. In the process of trying to square the circle of unreconcilable promises, the government wasted three years of time and effort failing to tackle the mounting economic problems of the day and did a lot of damage to the public perception of parliament. Admittedly, the pandemic blew everything off course but by then the zealots had taken over in Downing Street as moderates within government were either marginalised or exiled from the Conservative Party altogether.
Perhaps one of the most pernicious aspects of the Brexit saga is that it has enabled politicians to lie with impunity and not face any sanctions. As a consequence they have been able to ride out crises that would previously have been a resignation offence as former Chancellor Nadhim Zahawi’s latest trials and tribulations testify and further exemplified by the position of the chairman of the BBC whose close relationship with senior politicians has raised questions about a conflict of interest. Faced with a cost-of-living crisis not seen in decades (even the 1970s were not this bad as wages more than kept pace with inflation) public trust in government has collapsed. It is all very reminiscent of the 1990s when John Major’s government lost public trust following its handling of the ERM crisis and spent almost five years limping towards a heavy election defeat.
The immediate future
Quite where we go from here is difficult to say. The genie cannot easily be put back in the bottle but given the increasing realisation that the current form of Brexit is a mistake it is incumbent on the government to do all it can to mend fences with the EU. Doubling down on the current strategy is not going to get the electorate back onside, given the wide margin in opinion polls of those who think voting to leave the EU was a mistake (chart above). Issues that need to be addressed include the terms of the Trade and Cooperation Agreement between the UK and EU, which allows for tariff free trade for a wide range of goods but does not address the issue of regulatory harmonisation, which is a key element in agreements designed to increase trade flows. The issue of the Northern Ireland border has yet to be settled with the Northern Ireland Protocol Bill seeking to unilaterally override parts of the protocol that governs some aspects of trade in goods between the province and Great Britain.
Businesses face the prospect of considerable disruption in the face of government action/inaction on a number of legal matters. For example, the UK ‘Temporary Permissions Regime’ which allows EEA-based financial services to maintain their ‘passporting’ rights into the UK market, expires on 31 December 2023. If this is not extended or amended, there is the risk that financial services trade could be severely disrupted. Then there is the prospect that the Retained EU Law Bill, which passed unamended through the Commons last week, will intensify business uncertainty. In brief, this allows the government to revoke certain retained EU law at will, undermining the position of many businesses which continue to trade with the EU.
Simple fixes that the government could make include extending the Temporary Permissions legislation and deferring the introduction of the Retained EU Law Bill in a bid to kick it into the long grass. Similarly, postponing debate on the Northern Ireland Protocol and accepting that the current arrangements will have to remain in place for a while, will take some heat of tensions with the EU. None of this is to say that the UK is about to reconsider its position on EU membership. For one thing it is unlikely that the EU would be thrilled about a UK application anytime soon, nor is the electorate likely to have the stomach to rerun the debates of 2016 once again. Needlessly picking fights with the EU on issues we were told were settled two years ago will not get us anywhere, however.
But it is evident that the political class needs to address the elephant in the room that the current form of Brexit will not make the UK better off. That the Conservatives cannot or will not do so is perhaps understandable, given that so many members of the government were pro-Leave. Labour’s position is less forgivable. It continues to deny the extent of the problem for fear of upsetting the anti-EU media ahead of an election, despite recent polling evidence. At the very least politicians owe it to us to take a leaf out of the Obama playbook on foreign policy: “Don’t do stupid sh**.” Whilst in some ways this may be sound advice that comes too late, the next best option is don’t make it worse by ignoring the problem.
