Skip to Content

Coffee House

There’s only one way forward for Theresa May: keep Britain in the customs union

19 October 2018

1:30 PM

19 October 2018

1:30 PM

Hello from Brussels and the EU Council that promised a Brexit breakthrough and delivered nothing.

So on the basis of conversations with well placed sources, this is how I think the Brexit talks are placed (WARNING: if you are fearful of a no-deal Brexit, or are of a nervous disposition, stop reading now).

  1. Forget about having any clue when we leave about the nature and structure of the UK’s future trading relationship with the EU. The government heads of the EU27 have rejected Chequers. Wholesale. And they regard it as far too late to put in place the building blocks of that future relationship before we leave on 29 March 2019. So any Political Declaration on the future relationship will be waffly, vague and general. It will be what so many MPs detest: a blind Brexit. The PM may say that won’t happen. No one here (except perhaps her own Downing St team) believes her.
  2. The earliest date for a deal on Brexit terms – that vacuous Political Declaration and the Withdrawal Agreement – is now the Council in mid December. But even that date may prove too challenging.
  3. The gulf between the EU27 and May, as you know, is over how to keep open the Northern Ireland border. There is no chance of the EU abandoning its insistence that there should be a backstop – with no expiry date – of Northern Ireland, but not Great Britain, remaining in the Customs Union and the single market. That would involve the introduction of the commercial border in the Irish Sea that May says must never be drawn.
  4. All efforts therefore from the UK are aimed at putting in place other arrangements to make it impossible for that backstop to be introduced.
  5. Her ruse for doing this is the creation of another backstop that would involve the whole of the UK staying in something that looks like the customs union.
  6. But she feels cannot commit to keeping the UK in the customs union forever, because her Brexiter MPs won’t let her. So it does not work as a backstop. And anyway the Article 50 rules say that the Withdrawal Agreement must not contain provisions for a permanent trading relationship between the whole of the UK and the EU. Which is a hideous Catch 22.
  7. There is a solution. She could ignore her Brexiter critics and announce the UK wanted written into the Political Declaration – as opposed to the Withdrawal Agreement – that we would be staying permanently in the customs union. This is one bit of specificity the rest of the EU would allow into the Political Declaration. And it could be nodded at in the Withdrawal Agreement.
  8. But if she announces we are staying in the Customs Union she would be crossing her reddest of red lines because she would have to abandon her ambition of negotiating free trade deals with non-EU countries. Liam Fox would be made redundant.
  9. She knows, because her Brexit negotiator Olly Robbins has told her, that her best chance – probably her only chance of securing a Brexit deal – is to sign up for the customs union.
  10. In its absence, no-deal Brexit is massively in play.
  11. But a customs-union Brexit deal would see her Brexiter MPs become incandescent with fury.
  12. Labour of course would be on the spot, since its one practical Brexit policy is to stay in the Customs Union.
  13. This therefore is May’s Robert Peel moment. She could agree a Customs Union Brexit and get it through Parliament with Labour support – while simultaneously cleaving her own party in two.
  14. It is a Customs Union Brexit, or leave the EU without a deal.
  15. Which will May choose? Ultimately this is her choice, and hers alone. It is her moment in history.

This article originally appeared on Robert Peston’s facebook page


See also

Show comments
Close