Deadline 2021: the clock might (or might not) be reset but it is still ticking

Deadline 2021: the clock might (or might not) be reset but it is still ticking

May’s Brexit concessions still deliberately risk a Crash Brexit

So now we know what the longest cabinet meeting of the century achieved: everyone united around the proposition that if there’s a row to be had, it can wait. That’s as true of internal cabinet divisions as it is of the main UK-EU negotiations. At some point the crunch will come – but not yet.

It was always extremely likely that the UK would ask for some form of transitional period and it’s equally likely that the EU will agree. The reasons are simple: it’s in both sides’ interest to do so.

For Britain, it avoids the cliff-edge (or it takes a longer road towards it), and it grants flexibility in that interim period to negotiate both with the EU and with third countries around the world – something we aren’t supposed to do under EU law and probably wouldn’t have the capacity to do yet even if the desire was there.

For the EU, it fills what would otherwise be a sizable hole in the budget while taking Britain away from the EU’s core meetings (which an extension of the formal withdrawal period under Article 50 wouldn’t). For both sides, it avoids a damaging disruption of trade and of goodwill.

That’s not to say that such a deal will be easy but it will be a lot easier than the final settlement. The structures, the rules and the payments that will be needed for the transitional period are either in place or can be built out of the pre-existing arrangements. By contrast, the post-2021 arrangements will indeed need flexibility and innovative thinking – neither of which has been on abundant display so far.

Theresa May will also need flexibility and innovative thinking to keep her own support supportive. Again, agreeing the interim arrangement (or the offer of one) was the easy bit. Hard Brexiteers might grumble about what amounts to an extension of Britain’s membership and the extra fees associated with that but it’s not an issue to die in the ditch over. Likewise, the Irish border question can be fudged for now, if the UK continues to adopt EU rules more-or-less in entirety, but must be addressed eventually. At the risk of disappearing into the fractal-like politics of Northern Ireland, that issue will matter to the DUP both in its own right and because it’s likely to complicate the devolution process given Sinn Fein tends not to be keen on internal Irish borders.

2021 is also the deadline for another simple reason: the government has an overwhelming necessity of tying up the process before the next election (and not just the next UK election: the next German federal election after this weekend should be in autumn 2021 with the French elections following in spring 2022).

So despite the warmer tone, we should take seriously not just May’s suggestion of a maximum of “around two years” for the transitional period but also “life outside the Union with or without a deal”, and of explicitly accepting the possibility that negotiations might fail to reach an agreement: in other words, no deal remains an option and Britain might walk if the price isn’t right.

Kicking the can down the lane is standard diplomatic and political fare, particularly so within the EU. This time, however, assuming that the EU agrees to the extended timetable, leave really does mean leave, which is where the arguments will really happen, in Brussels and in Westminster. And leave will mean out of the Single Market, the Customs Union and the direct jurisdiction of the CJEU.

Those looking for splits within the Tory Party should note that May has today reiterated these red lines with virtually no murmurings from her party. That should be some consolation to her but only a little: the MPs (and wider party) might be signed up to the vision but the devil will be in the detail. In particular, come 2021, whether to take the terms on offer or to walk. That will be a massive call, one which if mishandled could bring about not just resignations but the downfall of the government. And it could well be mishandled on either side. This is a new process and pride, both individual and institutional, could well prevent the compromises necessary. In fact, given the slow progress so far, I’d say it’s odds-on that no final agreement will be reached by 29 March 2021.

David Herdson

p.s. I should say something about how her speech has transformed Theresa May’s survival prospects. Previously, 2019-21 was the most likely time for her departure. Now, given the necessity for stability during that period, when so much is up in the air, the chances of her going then are much reduced. Instead, the prospect of a summer 2021 departure has markedly increased. Similarly, by settling the Brexit question in the short term and without any major domestic reforms in the offing (itself quite remarkable), there is now a window of opportunity should MPs find reason to need it.

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