2017 02 Editorial – Brexit

May’s Fantasy Brexit

The government will invoke Article 50 of the Lisbon Treaty at the end of March, confirming the voters’ narrow decision to leave the European Union. If Parliament supports this, and they probably will, the UK will leave the EU at the end of March 2019. There will thus be a two year period during which agreement will need to be reached over a multitude of trade and other associated deals. During the two year period, however, these deals can only occur within the EU. Technically, the UK is not allowed to negotiate any deals outside the EU until exit takes place. From then on, no deal or bad deal, the UK will be on its own.

Over the six months since the UK voted to leave, Theresa May has been constantly accused of vagueness about the government’s plans for the UK’s future outside of the EU. In setting out a 12 point post Brexit plan at Lancaster House on 17 January she went some way to answer her critics. Yet in spite of her firm delivery, couched with threats to turn the UK into a low tax haven unless her demands are met, there is still a lot of vagueness and flights of fantasy about her aspirations.

Central to the plan is a determination to leave the single market and the customs union and for the UK to become a global trading nation. At the same time however May wants the UK to have the greatest possible access to both, without being encumbered with their rules and regulations. She claims to want “tariff-free trade with Europe and cross-border trade there to be as frictionless as possible.” Full access to the single market means accepting and abiding by its core principles of the free movement of capital, goods, services and people. May understands this, but is deeply aware that the free movement of people is anathema to those who voted to leave the EU.

May wants to get control of the number of people coming from Europe but is unclear how this is to be achieved. Overseas students, including from Europe, account for a substantial number of the total and she indicates that they will continue to be welcomed. She also says that the UK will always want immigration, especially highly-skilled migrants. Does this mean she accepts that there will never be a sustainable level of home grown skilled workers? A highly skilled UK labour force should be a priority aim of the government’s industrial strategy. May recognises this but there is incoherence in her aim to make the UK a high-skill economy while threatening a race down the value chain by becoming a tax haven.

It seems, however, that low-skilled migrants who take on seasonal employment are to be discouraged. This doesn’t augur well for the agriculture industry in particular, which depends on willing workers from the EU. Does the government intend to direct employers to use local labour rather than migrants? This will lead to higher costs and thus prices as employers are forced to pay higher wages to attract local labour, but higher wages are to be welcomed as they will benefit the local economy and workers.

May wants the common travel area between the UK and the Republic of Ireland to continue. But controlling immigration from Europe will be more difficult if there is a ‘soft’ border between the two parts of Ireland. A ‘soft’ border will enable EU migrants to access Northern Ireland from the Republic of Ireland, a member of the single market allowing free movement of people. Passage to England or Scotland will then be possible. A heavily guarded ‘hard’ border will help to prevent this, but the security services fear that customs posts could become a target for terrorists.

May is unclear how the UK is to have the best possible trade deal with the EU outside of the single market and the customs union. This could be achieved through membership of the European Economic Area, like Norway for example. But this would mean accepting rulings of the European Court of Justice and mobility of labour and May has ruled these out. Brexit Secretary David Davis has said that the UK could pay for targeted access to certain markets; a cost currently included in the UK’s financial contribution.

The Brexit Secretary’s is one, albeit limited, opening, but if May is really serious about the UK becoming a global player then it will have to look to the World Trade Organisation. That is clearly her intention. She wants the UK “to be free to establish our own tariff schedules at the World Trade Organisation, meaning we can reach new trade agreements not just with the European Union but with old friends and new allies from outside Europe too.” Her ambition gives a whole new meaning to having one’s cake and eating it.

Leaving the single market and the customs union, and with the UK no longer subject to the European Court of Justice, will return sovereignty to Parliament. That being so and given that the referendum result was merely advisory, although that was not made clear during the campaign, Parliament will be the final arbiter of the result. The majority of MPs will not block the people’s decision to leave. Furthermore, May has agreed that Parliament will judge whether the final outcome of the negotiations is in the best interests of the country.

May promises “not only” to “protect the rights of workers set out in European legislation” but also to “build on them.” Furthermore she says that “the voices of workers will be heard by the boards of publicly-listed companies for the first time.” The best way to protect the rights of workers is through membership of strong trade unions. But May’s government has made it more difficult to join and organise within a trade union. And her commitment that the “voices of workers will be heard by the boards of publicly-listed companies” is a step back from her earlier promise to ensure worker representation on company boards. Having the voices of workers heard by boards is far removed from actual worker representation. Once again, May is being deliberately vague.

This is also a difficult issue for Jeremy Corbyn. The TUC has set out a clear programme for worker representation, but it seems that no trade union has taken this on board. And some would no doubt be hostile to the idea. Corbyn has a good relationship with the unions, supporting them through difficult times when like previous Labour leaders he could have kept his head down. Labour Affairs supports the TUC’s programme and urges Corbyn to encourage unions such as Unite to adopt worker representation as a priority issue.

Corbyn is once again under fire from his backbenchers. He is accused of not having a clear message on Brexit and of being “weak” on immigration. His insistence that Labour MPs do not block Article 50 is bizarrely seen as a lack of leadership. There are, however, reports that as many as 30 Labour members, mostly in constituencies that voted to remain, may defy Corbyn on this. This will further damage Labour and could result in the loss of dozens of seats in 2020, ensuring the re-election of a Tory government.

But as a previous Labour Prime Minister once said: “A week is a long time in politics.” 2020 is three years away. In the meantime, Corbyn’s aim is to unite Labour. He is not going to resign so his colleagues will have to come to terms with his leadership style and his refusal to compromise on his principles. An admirable trait in a politician. It is his principled stand on immigration that makes it difficult for him to fall in behind the anti-immigration views of many Labour voters.

Unlike Teresa May, Corbyn doesn’t blame immigrants for the crisis in public services. In her Lancaster House speech she referred to the record levels of net migration in the last decade, omitting to mention that as Home Secretary for six of those years she was ultimately responsible for this. She went on to say that the high volume of immigration has put pressure on public services. This serves as a convenient deflection from the massive cuts in public service funding by her government. Immigrants are blamed for the pressures on the NHS, Social Care and other services, not the government’s parsimony.

May’s Brexit plan was inevitably welcomed by the Europhobe press. Overshadowing it was a barely disguised anti-immigrant rhetoric, aimed at the Leavers. She has an eye on Labour’s heartlands in the North and Midlands. Hence her “looking after the just managing” and the “shared society” cliches. But UKIP rather than the Tories could gain from Labour. Their opportunity will come on 23 February in the Labour-held seats of Copeland and Stoke Central.

The by-elections in Copeland and Stoke, caused by the resignations of Jamie Reed and Tristram Hunt to take up more lucrative employment, will be seen as testing grounds for Corbyn’s leadership. Hunt was imposed on Stoke, with which he had few shared values. His politics were at odds with Corbyn’s and he was one of his most vocal critics. He obviously saw no future for himself in a Corbyn-led party. Following boundary changes, his seat will in any case disappear at the next election. But he may at least have the honour of facilitating a UKIP breakthrough into Parliament. If so, that will be his sole legacy. He will not be missed.

Corbyn has said that in Copeland and Stoke Labour will focus on the crisis in the NHS, job insecurity and widening inequality, but it will also need to send a clear, unambiguous message to voters on immigration if it is to hold on to its seats, which are in danger of being lost. Not because of Corbyn’s policies, but because of the Blairite legacy. Blair’s aim was to rid Labour of its history and reshape the party into a kinder, softer version of the Tories.

Immigration is undoubtedly a tricky issue for Corbyn and Labour. However, his and Labour’s message should recognise the concerns of voters about the high levels of immigration over the past decade or so. It could guarantee that a future Labour government will manage immigration in a balanced and fair way, to ensure that it does not adversely affect the delivery of public services, or reduce the working conditions and job prospects of UK citizens.