Brexit Deal Not Looking Good: Early 2018 Assessment

This opinion article, first carried by EU Observer in January 2018, takes stock of the Brexit negotiations roughly nineteen months after the referendum. The views are those of Diane James MEP.

Why talks were bumpy

She starts from the premise that few people believed the process was going smoothly. In her view there were too many economic and political interests involved, and the government had made things harder by barring civil service preparation before the vote and then waiting nine months before triggering Article 50.

What the deal seemed to contain

Her central claim is that the shape of the agreement looked little like the Brexit voters were promised. She lists the points as she saw them.

• Agencies. The UK would leave Euratom, which she describes as closer to a trade association for sharing nuclear knowledge, something she considered important while old power stations are decommissioned. It would also be forced out of Europol, which she calls small and ineffective, despite efforts by the Prime Minister to stay.
• Customs union. The Chancellor, Philip Hammond, was declining to rule out staying in it.
• Programmes and money. Britain would keep funding the Horizon 2020 research programme and taking part in Erasmus, and would carry on paying into the EU budget at least until the end of the transition, including support for the creation of an EU army.
• Rules and courts. The UK would have to accept new EU rules until the last day, and the European Court of Justice would keep jurisdiction over EU citizens living in Britain for eight years.
• Finance and energy. The City would stay aligned with EU rules, as the second Markets in Financial Instruments Directive had just come into force, and it seemed likely that power and industry would still follow EU carbon rules.
• Fisheries. The UK looked likely to remain in effect inside the Common Fisheries Policy.

Money the UK might not recover

She notes a promise that the UK’s stake in the European Investment Bank would be returned by 2054, but says nothing had been said about its share of the European Investment Fund or the European Fund for Strategic Investments, to which Britain is the largest contributor, with 8.5 billion euros committed. The UK’s share of the European Bank for Reconstruction and Development, held through the EU, had not been mentioned either.

Planning for the future

Finally, she says the EU had told Britain that no trade agreement could be finalised before departure, and that the four freedoms of labour, capital, goods and services were not up for negotiation, which left the UK unable to plan.

Her verdict

Summing up, she sees a plan that has the UK leaving two minor agencies, still paying into the budget, still bound by rules old and new, still inside fisheries policy, and out of pocket on loans, and she concludes that this does not look like a meaningful Brexit.

These are her assessments as of January 2018. The final withdrawal terms later differed from several of the expectations described here.