Monday 11 November 2019

Johnson: are we about to see a pact with Farage?

With three days to go before the candidates need to be confirmed, it's obvious that Johnson is edging towards some sort of accord with Nigel Farage. With so much volatility in the polls it wouldn't make sense to risk Brexit by splitting the leave vote. Labour may well need to make some very quick decisions and join the Remain Alliance if they are to respond to such a move. Farage has softened his earlier position from a 'clean' no-deal Brexit immediately to one at the end of 2020.

Of course, it wasn't quite sold like that.  Farage is simply asking that we effectively leave the transition period on December 31st next year, come what may, which effectively amounts to the same thing.

In his Sunday evening Twitter videocast, Johnson said:

'We can get the fantastic new free trade agreement with the EU by the end of 2020. And we will not extend the transition period beyond the end of 2020.

'There's absolutely no need to do that. So fantastic new deal, let's get Brexit done, and then build a new partnership with the EU and do free trade deals around the world.' 

So, that's it then - no extension to be requested. He seems utterly ignorant of the reality of it all. The Daily Mail called it an olive branch but it's no different to what Johnson has been saying for weeks regardless of how many people tell him it is highly unlikely if not totally impossible that a free trade agreement will be ready by the end of 2020.  Any agreement with Farage is going to built on an impossibility and it will only end in more acrimony.

Simon Fraser, former Permanent Secretary at the Foreign Office and the Business Department is the latest to warn Johnson about it.  In a Twitter thread he sums up the difficulty:
To save you the trouble I've copied the rest of the ten-tweet thread below (my emphases):

Many of the hardest #Brexit calls have been deferred until we leave. UK & EU will need to agree on a vast range of issues. Not only trade in goods & services, but also regulatory standards, aviation, fisheries, security, science, defence, data, labour mobility & more..

The scale of the task will depend on the nature of the intended relationship. The Johnson idea of Future Partnership is an arm’s length, third country free trade agreement with regulatory freedoms - a radical change from our current terms with our nearest, largest market..

An FTA based deal would inevitably result in significant new obstacles to trade in services with EU. On goods, a zero tariff & zero quota outcome may be possible, but checks will still be required on the UK/EU border for customs, rules of origin and regulatory controls..

Structuring phase 2 negotiations will be complex. On EU side they involve a mix of “community” & national competences. Michel Barnier will stay to lead the overall Commission process, but it will require delicate orchestration, & member state interests will diverge..

On UK side expect David Frost to lead on phase 2 in No 10 with the incoming Brexit Secretary. But negotiations will have to be conducted on a broader & more transparent basis that phase 1, involving experts widely across government & crucially devolved administrations..

In theory all this has to be buttoned up before the end of the status quo transition period in December 2020. This will not happen. An extension of 1 or 2 years can be agreed in June next year, but B Johnson rules this out, digging, it seems, another ditch to die in..

To meet the impossible December deadline negotiating mandates will be needed on both sides early in 2020 (cue more political controversy). Intense negotiations would then have to follow. Legal texts would be needed in October for any chance of ratification by December.

On ratification, given the range of issues & future commitments involved, unlike the Withdrawal Agreement the phase 2 deal(s) would need to be scrutinised by national parliaments across the EU, as well as the UK parliament..

All of which means that a no deal breakdown, although now very unlikely, and probably less severe, remains possible at the end of the transition period, particularly if UK does not seek extension.

I think Mr Fraser is right to conclude the impact of no deal at the end of 2020 will be less severe since business and government on both sides will have had more time to plan for what would still be quite a shock, with a very large and sudden overnight change to our trading relationship. It will still be very disruptive.

One of the things that has always puzzled me about Brexit is the lack of any clear or coherent ideas (indeed any ideas at all) about where and by how much we intend to diverge from the tight regulatory alignment we have at present. I never hear any Brexiteer actually spell it out and yet this question will need to be answered in short order.

I imagine the EU will raise it very early on. They know we want to diverge, otherwise why Brexit at all?  What they don't know is where the divergence will stop - and I am not sure that the British side knows the answer to it either, at the moment. The EU is not going to permit an FTA to be agreed with a third country giving it carte blanch to constantly water down and erode employment, social and environmental standards. They do not want EU companies to face unfair competition or dumping and will want to set a limit close to where we are now - otherwise there will not be a zero tariff, zero quota FTA anyway.

How this will be determined and then set out in a legal text will be fascinating. If Brexit goes ahead it will certainly have to be done at some point.  It will probably be the row of the summer - as David Davis once said.

Even if we crash out without a free trade deal in 2020 under a Conservative government, some other future administration will have to reach an agreement and, given the unequal negotiating heft and the declared position of the Labour and Liberal parties, the divergence will stop not very far from where we are now.  For many leave voters that will be the moment the penny drops.

Brexit will have all been for almost nothing and we will be following EU rules and regulations that we have had no input into.

How a man who is unable to lay a wreath at the Cenotaph the right way round is going to navigate all the mind-numbing complexity of this is a mystery.

On another highly topical matter, someone has unearthed BBC footage of Alexander Temerko, the Russia oligarch who is one of the nine donors to the Tory party said to be named in the ISC report that Johnson has blocked, speaking in October 2016.  He said he was in no doubt that Mr Johnson would become "our next leader".  As of course, he did - perhaps with Temerko's help?

What is strange about the whole affair is the amount of money Temerko gave to individual MPs. But despite backing Johnson so publicly in 2016 he does not seem to have contributed a penny to Johnson himself.  I wonder why?