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The last throw of the dice for the UK and the EU

Fabian Zuleeg

Date: 13/02/2019

During the Brexit process, there have been many moments of drama and many near cliff edges. But now a catastrophic Brexit looms ever closer, propelled by an impasse caused by the United Kingdom (UK) rejecting all options on the table. None of the alternatives – no deal, no Brexit or a negotiated exit along the lines of the existing deal – command a majority in the House of Commons. But any substantive changes to make the deal more palatable, most notably regarding the Irish border backstop, are not acceptable to the EU27. This is not only a matter of principle. For the European Union (EU), standing by a (small) member state in defence of its interests against a future non-member is an existential question.

So the EU will never abandon Dublin. However, the Union, including Ireland, has a very strong incentive to find a way to avoid no deal given its economic and political costs; while asymmetric, with the UK bearing the brunt of the impact, the EU27 will also be hit hard.

The obvious path to minimise the negative impact on both sides would be if the UK were not to leave after all, deciding at the last moment to rescind the Article 50 notice or schedule a 2nd referendum (which would require an extension of Article 50). But whether this would be a stable outcome and what backlash might result from it is a moot point, as there appears to be nothing approaching a House of Commons majority in support of this, with most MPs believing that the 2016 referendum result has to be respected.

That leaves us with a negotiated deal, building on the existing Withdrawal Agreement and Political Declaration. There are, essentially, only three different House of Commons majorities that seem feasible: one based on fear and desperation, hardline or centrist – but only one could work.

A majority based on fear and desperation would rely on getting the current deal through, essentially without any real changes, by making MPs face the cliff edge of no deal. But, given the historic scale of May’s defeat, it is a high mountain to climb. Many in May’s own party will not support her, so a fear and desperation majority would have to rely on a significant number of defectors in the opposition. But the temptation for the opposition will always be to bring down the government on this unpopular deal, to be followed by a General Election, which is the real objective of the Labour leadership. Many think a new government could negotiate a better deal and would be given the time to do so by the EU, removing the fear of the cliff edge.

But the alternative, constructing a majority between the Tories and the DUP alone, would be challenging at the best of times. There is a good number of convinced Brexiteers, maybe around 40, that will rebel against May’s deal under almost any circumstances. For them, no deal is the first preference, not something that needs to be avoided. So, she needs a significant number of opposition rebels, or at least a significant number of abstentions, to get any deal through. But with a deal that will include the backstop, which will not be altered in substance, she will not have the DUP on board and that implies losing many more Conservatives than she can afford; even more moderate Tories would find it difficult to openly abandon the DUP at this stage, not least because it would also imply that the government loses its overall majority.

The only remaining option is to construct a majority at the centre. But to get there one would have to reopen the Political Declaration. To reach that point the UK government will have to let go of some of its red lines to move towards a softer Brexit, which has always been the pre-condition for the EU27 to amend the deal on the table. But at the same time, the prime minister must not lose her own 196 MPs that have voted for the deal.

A possible way would be to outline an aspirational scenario in the Political Declaration that would deliver a frictionless border, potentially including:

  • a common customs territory between the UK and EU (in part fulfilling Jeremy Corbyn’s demands);
  • dynamic/automatic regulatory alignment of the UK but only in areas crucial to maintain a frictionless border;
  • where checks are necessary, whenever possible they should be aided by technology and take place off border (alternative arrangements);
  • a UK-wide solution, maintaining the integrity of the UK Single Market;
  • a clear commitment that any arrangement will not jeopardise EU governance and the integrity of the EU Single Market;
  • provisions for agriculture to enable an integrated agricultural market on the island of Ireland;
  • enabling small traders/services to continue operating across the border; and
  • continued freedom for people to cross the Northern Ireland/Ireland border, i.e. the Common Travel Area.

This scenario would not necessarily be the outcome of the phase 2 trade negotiations, but it would define the landing zone which would be necessary to make the backstop obsolete, i.e. it would still be up to the UK to decide at the end of the negotiations whether politically this outcome is acceptable. A legally binding protocol could be attached to the Withdrawal Agreement, detailing that, if the model laid out in the Political Declaration is delivered, the backstop will no longer be necessary.

This solution should be acceptable to both sides. It does not undermine the nature of the backstop as an underlying guarantee for a frictionless border. In effect, it would be unchanged and still legally binding. But both sides would add a legally binding, clearer definition of the scenario under which the backstop would no longer be necessary.

It will not be easy for the EU27 to accept this solution. The trust between London and Brussels has been eroded and there is real doubt whether this would be enough to get the deal through the House of Commons. However, better to propose a solution than to be confronted with a chaotic no deal, not least because blame will be put on the EU if no solution is provided.

But even if the EU27 would be ready to move in this direction, the real challenge lies with the UK side. This solution would fulfil May’s need for a legally binding change, clearly setting out the conditions for an exit from the backstop arrangements. By noting explicitly that it is a UK-wide solution and not a separate approach to Northern Ireland, she might get the DUP on board.

But the problem here is internal party politics. Theresa May would have to accept that moving that far to the centre will almost certainly split her party, going against the Euroscepticism of most of the Conservative Constituency Associations, and, most probably, end her own political career. Jeremy Corbyn would also need to accept this olive branch, forgoing the chance to bring down the government and alienating the strong Remain supporters among Labour MPs and within the wider party membership. So, there is a high price to pay for a centrist compromise, requiring a deviation from party unity and adversarial politics. But, at this stage, it seems the only chance left to avoid no deal.


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