Reaching agreement on the future EU-UK relationship within a year was always ambitious. Now, with Ministers and civil servants focused on fighting coronavirus, it is impossible. An extension to the transition period is needed to protect citizens and the economy.
In December last year, British voters gave Boris Johnson a strong parliamentary majority, having been promised that his Conservative Party would “get Brexit done” by the end of 2019. Once formed, the new Government almost immediately committed to another self-imposed Brexit deadline, this time telling voters that the transition period would not be extended beyond 2020.
A transition period was written into the Withdrawal Agreement to fulfil a need – recognised by both the European institutions and the May administration in the UK – to provide citizens and businesses with a level of certainty and continuity during the time between Britain leaving the EU and a deal being ratified to govern the future relationship between the two polities.
As many politicians and commentators have noted, attempting to strike a trade agreement that will, unavoidably, be both complex and unprecedented is ambitious to say the least. Let us use the Government’s favourite comparison, CETA, to illustrate this point. The EU-Canadian FTA was signed in 2016 and entered into force the year after (although some provisions are still not in action). Those negotiations were launched in 2009, after half a decade of cooperative scoping exercises.
At times, when there is less media attention, members of the Cabinet admit that twelve months is a tight timescale for negotiating and ratifying an FTA with the EU. Minister Michael Gove, who is coordinating future relationship negotiations across Whitehall, conceded during a select committee hearing in early March that negotiations may spill over into 2021 and beyond in areas such as internal security. This suggests the Government may privately have a strategy to strike a limited trade deal first and move on to negotiate other, more contentious sectoral agreements at a later date.
A year is not a long time to strike a trade agreement, even one of limited scope (we can ignore for now the fact that the relationship which both the UK and EU committed to in the Political Declaration goes far deeper than any FTA that has ever existed). This would be true even if three months had not already passed and negotiations were taking place. But, due to the coronavirus pandemic, talks have been frozen. The UK has pushed back the publication of its draft legal text for its preferred future relationship with the bloc and a Commission briefing to the EU27 reportedly said that negotiations via video conference had proved impossible.
Increasingly, there are calls to extend the transition period. Speaking in January, Commission President Ursula von der Leyen warned British negotiators that “you cannot expect to agree every single aspect of our new partnership” within a year. Earlier this month, representatives from the European Parliament’s main political groups in the influential Internal Market and Consumer Protection (IMCO) Committee proposed a cross-Committee statement urging the UK to request an extension and avoid that recurring threat of the ‘no deal’ cliff edge.
Two main arguments have been employed by those opposed to such an extension. The first is sovereignty. It is true that the transition period leaves the UK in an undesirable position as a ‘rule taker’ without formal political representation, but equally undesirable would be rushing through a trade agreement without proper scrutiny (an inevitability at a time where parliamentary activity is largely suspended and political energy is necessarily focused on fighting coronavirus).
The second argument centres around money. Extending the transition period would likely require the Treasury to contribute to the EU’s next Multiannual Financial Framework, either directly or indirectly, however any such payment would be nugatory compared with the COVID-19 package already announced by Chancellor Rishi Sunak. More importantly, the double blow of a pandemic and a ‘no deal’ Brexit would be paralysing to the national finances and should be avoided at all costs.
Attempting to conclude a future relationship agreement with the EU by the end of the year would not only be unacceptably undemocratic, it would result in a worse deal. Failure to extend or reach a deal would cost the economy dear, in terms of tax receipts and job losses. These are things any rational person would want to avoid.
If an extension to the transition period is required, then better to request it sooner rather than later. Earlier notice gives certainty to citizens and to businesses. The public has already proved itself to be understanding of extraordinary measures and political decisions in response to the COVID-19 pandemic. This is not an ideological question of remain or leave, left or right; it is a question of democratic principles and sound economic management. The Government must request a transition extension now.
John McStravick is Vice-Chair of Agora. @JS_McStravick