BREXIT CHAOS: No end in sight

100,000s march against Brexit in London, 20 October 2018

Fight Racism! Fight Imperialism! 267 December 2018/January 2019

After months of negotiations, with further concessions having to be made by the British government, Prime Minister Theresa May was able, finally, to announce on 14 November 2018 that all aspects of the withdrawal (transitional) deal – including settling accounts, citizenship, and the Irish border – had now been finalised and agreed at negotiator level. This agreement is essential if the UK is to retain the benefits of the single market and customs union for a further 21 months after leaving the EU on 29 March 2019. The transitional period itself, however, depends on the withdrawal deal being agreed and ratified by both the UK and EU parliaments. The negotiators have also agreed on the outline of a political declaration on the future UK-EU relationship. DAVID YAFFE reports.

The withdrawal agreement and the Irish border

The initial published draft withdrawal agreement contained a default ‘backstop’ solution, written into the December 2017 agreement at the request of the Irish Republic, under which the north of Ireland would maintain full alignment with the EU single market and customs union. It was totally unacceptable to the Eurosceptics in the cabinet and to the Democratic Unionist Party (DUP), which the government relies upon to maintain a working majority in parliament, as it is seen as threatening the constitutional integrity of the UK, and according to them creating a customs and regulatory border down the Irish Sea. The ‘backstop’ was accepted by the government with the proviso that that both sides work towards technological and legal alternatives that will avoid this necessity.1 The Chequers proposal was designed to do this. Its rejection by the EU negotiators and significant sections of her feuding party created what were and still are irresolvable problems for the Prime Minister.2

In order to break the impasse in relation to the Irish border, in the period before the EU summit on 17/18 October, May attempted to get the EU to agree to a ‘temporary’ customs union between the whole of the UK and EU 27 member states to eliminate tariffs until a future trade agreement was in place.

A few days later May briefed her inner cabinet that a Brexit deal was close. She faced an immediate backlash from Eurosceptic Tory MPs, including two cabinet ministers who were said to be on the verge of quitting on hearing that the Prime Minister was ready to sign a ‘backstop’ plan that would see the whole of the UK stay in a ‘temporary’ customs union without an end date. In his inimitable style attacking the plan Jacob Rees-Mogg, arch-Eurosceptic head of the 60-strong European Research Group MPs, said: ‘It is worth remembering that income tax was introduced as a temporary measure. Without an end date, we could be in the customs union forever.’

May was facing a major cabinet revolt. The Prime Minister told her negotiators in Brussels to thrash out a new language for a proposed Brexit withdrawal agreement that would reassure Tory Eurosceptics that any ‘backstop’ plan to avoid a hard border in Ireland could not lead to permanent membership of the EU customs union. The UK wants the arrangement to be temporary but the EU refuses to set a firm end date for the arrangement. An official close to Eurosceptic ministers said at least nine members of the cabinet would reject a customs union between the UK and the EU that had no end date, unless it explicitly set out how Britain could extricate itself.

The present 585-page draft withdrawal agreement contains a key concession that has further infuriated many Brexiters. Britain will not be able to unilaterally exit the ‘backstop’ plan to avoid a hard border on the island of Ireland. That decision will lie with a joint committee with an equal number of UK and EU representatives, as well as outside independent members. The EU and the UK will decide jointly within this committee that the ‘backstop’ is no longer necessary. There would be no unilateral way to withdraw from the backstop.

Northern Ireland will be bound into a far deeper relationship with the EU than the rest of the UK. It must accept large parts of the single market rules and regulations overseen by Brussels and the European Court of Justice. The ‘backstop’ will start at the end of Britain’s transition period (at present December 2020) ‘until and unless’ alternatives are agreed. It includes an EU-UK customs union with accompanying restrictions on competition, environmental standards, tax and labour policy.

The DUP, whose votes the government relies on for its parliamentary majority, has made it clear that the withdrawal deal is not acceptable. At its annual conference on 24 November DUP leader Arlene Foster will rally activists behind her rejection of the withdrawal agreement that she says tramples over the party’s ‘blood red’ lines. The DUP’s ten MPs recently refused to support the government and abstained or backed Labour in a series of votes on the Budget – breaking the so-called Confidence and Supply deal between the DUP and the Tory party. This is a warning shot to the government on future developments if it doesn’t change its Brexit strategy.

May’s premiership under threat

May called an emergency meeting of her cabinet for the afternoon of Wednesday 14 November 2018 to sign off the long-awaited draft withdrawal deal. Ministers had been summoned to Downing Street during the previous evening, with some meeting individually with the Prime Minister or her Chief of Staff. They were given the opportunity to read the 585-page withdrawal agreement, a binding legal document of rights and obligations, as well as the seven-page aspirational outline of Britain’s future relationship with the EU for the next stage of Brexit negotiations. They were not allowed to take any papers away. Further one-to-one meetings took place the next day.

The Prime Minister clinched the support of her deeply divided cabinet for her Brexit deal after more than five hours of fraught and ferocious debate. Up to 11 cabinet ministers were said to have spoken against the deal. The Work and Pension Secretary Esther McVey voiced strong objections to the deal and warned of chaos if the government lost the ‘meaningful vote’ on the deal in parliament. Her request to hold a vote in the meeting was twice refused.

On the night of the meeting the Prime Minister came out of 10 Downing Street and made a statement. She said that the draft withdrawal agreement was the best that could be negotiated: ‘When you strip away the detail the choice before us is clear. This deal, which delivers on the vote of the referendum, which brings us back control of our money, laws and borders, ends free movement, protects jobs, security and our union, or leave with no deal, or no Brexit at all.’ She ended by saying: ‘I firmly believe, with my head and my heart, that this is a decision that is in the best interests of our entire United Kingdom.’ In saying that ‘no Brexit’ was one alternative to accepting her proposals, she gave some credibility to those arguing for a ‘People’s Vote’ – a second referendum with remaining in the EU as an option.

Over the next 24 hours two cabinet ministers resigned – the Brexit Secretary Dominic Raab and Esther McVey – along with five junior ministers. The Environment Secretary Michael Gove was offered the job of Brexit Secretary but turned it down when told that he could not negotiate a change of Brexit strategy. For the time being this careerist remains in the Cabinet. Amber Rudd has replaced McVey as Work and Pensions Secretary. She has been recalled to the cabinet less than seven months after being forced to resign as Home Secretary for lying about her department’s racist deportation targets during the Windrush scandal. Stephen Barclay, health minister and leave supporter, was promoted to Brexit Secretary. He will have a limited role to play with May firmly in control of future negotiations. This former banker and City minister has never rebelled against the government – clearly an ideal choice for the job.

On 15 November Jacob Rees-Mogg melodramatically announced he was sending a letter to the chair of the backbench 1922 Committee Sir Graham Brady calling for a vote of no confidence in the Prime Minister. A dozen or so other Tory backbenchers announced that they had done the same, calling for May to step down over her Brexit proposals. 48 letters must be received before a vote of no confidence can be held. On Friday 16 November the group claimed it would have the number required. By the following Monday it became clear that Eurosceptic Tory MPs had been unable to mobilise the 48 names needed to trigger a leadership challenge. Over the same period the possibility of a united intervention to renegotiate parts of the withdrawal agreement by the ‘gang of five’ Brexiter Cabinet ministers, including Michael Gove and the Leader of the House of Commons Andrea Leadsom, had failed to materialise. As Iain Duncan Smith, the pro-Brexit former Tory leader had remarked a few days earlier in suggesting their mutiny might be limited: their ‘spines do not yet meet their brains’.

With the Eurosceptic rebellion, subdued for the time being, the Prime Minister set off to Brussels on Wednesday 21 November to meet with Jean-Claude Juncker, the European Commission President, to finalise Britain’s exit package. After nearly two hours discussion with Juncker, May admitted that there were some major issues still to be resolved. Directions were given to negotiators to immediately deal with them. She is to make an emergency trip to Brussels on Saturday to complete those negotiations so the finalised Brexit deal – the withdrawal agreement and political declaration – can be endorsed by a European Council of the 27 heads of state convened for Sunday 25 November, a necessary condition for the exit deal to be sent to the European Parliament for its consent. Spain has already warned that it could reject the deal if it is not given a veto to prevent any future trade deal between Britain and the EU that covers Gibraltar. EU states led by France are pushing to continue with the status quo on fishing, with EU trawlers having access to UK waters post-2020. German Chancellor Angela Merkel has also made it clear that she will not negotiate with Theresa May at the Sunday meeting and will not attend it unless her top aides are given at least 24 hours with the final document in preparation for the summit.

On Thursday 22 November May announced the Brexit exit agreement was now complete, with an expanded 26-page Political Declaration setting out the future UK-EU relationship. It had been prepared overnight by negotiators after the May-Juncker meeting in Brussels the previous day. A final provision in the withdrawal agreement was also sorted by negotiators on Thursday. It allowed for a one-off extension to the Brexit transition period for up to one or two years to December 2022 at the latest, six months after the next general election is due to take place. During the transition period, however long it may be, the UK will be subject to all EU laws, but has no say in enforcing or deciding them. Extending the Brexit transition would leave the UK paying billions more to the EU, while having no say over how the money is spent.

The Political Declaration is a non-binding statement of intent. It is full of aspirations and good intentions, which do not significantly constrain either side when talks on the future UK-EU relationship begin after the UK leaves the EU on 29 March 2019. The text appears to avoid the most contentious proposals of May’s Chequers agreement from July 2018, most importantly the proposal for ‘frictionless’ trade in goods based on a ‘common rule book’. May wants a trade plan to ensure the Irish ‘backstop’ – detested by Brexiters because it binds the UK into a customs union with the EU – will never be used. It wants to replace the backstop with some version of the ‘maximum facilitation’ option rejected by the Chequers agreement, returning to some variety of advanced technological solution, as yet unspecified, for the Irish border.3

The City will be very dissatisfied by the lack of progress on financial services. Instead of the present ‘passport’ rights that allow financial companies easy access to EU markets, bankers and traders will be on a stricter ‘equivalence’ regime, allowing market access to be withdrawn at 30 days’ notice. While there will be equivalence assessments and ‘appropriate consultations’ on these issues by mid-June 2020, it will be a serious blow to the 5,500 UK-based companies that will be losing their ‘passport’ rights. Given the centrality of financial services and the City of London for the British economy, these developments represent a serious setback for British capitalism.

Once the European Council has endorsed the Brexit exit agreement it must be ratified in a ‘meaningful vote’ to take place in the British parliament on 10 or 11 December. It is highly likely that the Tory government will lose this vote. Labour’s Shadow Brexit Secretary Keir Starmer said that the exit agreement does not pass the Labour Party’s ‘six tests’ and the Labour Party will vote against it. Around 80 Brexit-supporting Conservative MPs are expected to join with the Labour Party, the Scottish National Party, the Liberal Democrats and other small parties and probably the DUP in rejecting the exit agreement. Theresa May’s premiership is under serious threat and with it that of a future Tory government.

The Prime Minister and key cabinet ministers have launched an offensive to try and sell the deal to business leaders and the British public throughout the country. A media campaign has started with the Prime Minister appealing directly to the audience and answering their questions on the Brexit deal. The aim is to try and change the national attitude to the deal with the intention of pressurising MPs into supporting her.4

The problem lies with a Tory party hopelessly divided, yet determined to hold on to political power. It should be remembered that the referendum held in June 2016 was called by then Prime Minister David Cameron in an attempt to contain the deep splits in the Tory party over Europe, exacerbated by the challenge of the United Kingdom Independence Party’s (UKIP) anti-EU stance and racist immigration policy, and to strike a populist pose to improve his party’s prospects in the next general election.

Today Theresa May’s minority government is irrevocably divided on Brexit, desperately holding on to power with the support of the deeply reactionary pro-Brexit DUP. While this is the impetus behind the bungled negotiations it is not its root cause. That is grounded in the relative decline of a British capitalism facing a global economic crisis and growing imperialist rivalry.


[1] For a discussion of this issue in the initial published withdrawal agreement see David Yaffe ‘Brexit hard facts deflate Tory illusions’  FRFI 263 April/May 2018 on our website at https://tinyurl.com/y8fzltcs

[2] See David Yaffe ‘Brexit Tory infighting shatters government illusions’ FRFI 265 August/September 2018 on our website at https://tinyurl.com/y9h3v3cx for discussion of the Chequers agreement.

[3] See David Yaffe ‘Brexit the end game approaches as imperialist rivalries intensify’ FRFI 264 June/July 2018 on our website at https://tinyurl.com/y98hlj36 for a more detailed discussion.

[4] A great deal of the information in this article is taken from the Financial Times and The Guardian over the period covered. As we go to press EU leaders have approved the agreement of the UK’s withdrawal next March and its future relations, insisting it is the ‘best and only deal possible’.

 

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