The deal on the first phase issues foundered on the Irish border issue and specifically on the regulatory alignment phrase. I think we can take it that the British government now accepts the need for some form of regulatory alignment if a hard border is to be avoided, or at the very least the UK accepts that talks could not continue unless we explicitly accepted this was a likely outcome.
Because of the time constraints and the urgent need to get to trade talks the government was looking for a form of words (a fudge) that would be acceptable to both sides. The original draft text that had been circulating last week apparently talked of "no regulatory divergence". I assume this was an Irish proposal since they have given the issue more thought than anyone else. The sentence began with, "in the absence of an agreed solution", which allowed the illusion that creative technology was the answer to continue a while longer.
But the text was changed over the weekend so that "no regulatory divergence" became "regulatory alignment" and it applied to NI only. Both these phrases upset the DUP, neither was acceptable to them.
On Monday afternoon Leo Varadkar, giving a badly delayed press conference, was asked about the subtle change of wording and he was quite clear, they meant the same thing. He was quite unequivocal about it. On Tuesday Labour tabled an urgent question and David Davis had to attend the House to answer it and in the ensuing debate we got into an amazing series of exchanges as Davis performed an elaborate Strictly Come Dancing routine on the head of a pin. He was trying to draw a huge distinction between no regulatory divergence and regulatory alignment.
Firstly, to set the stage, right at the outset (Col 895 HERE) in answer to Bill Cash about the jurisdiction of the ECJ Davis said, "He has a long history with this subject, and he explains better than I could why we said that no divergence is a bad option". So read everything now in this context.
In answer to a question from Yvette Cooper (Col 898):
I refer the right hon. Lady to the speech that the Prime Minister made in Florence, I refer the right hon. Lady to that speech, because in it the Prime Minister made a very plain case for the sorts of divergence that we would see after we left. She said that there are areas in which we want to achieve the same outcomes, but by different regulatory methods. We want to maintain safety, food standards, animal welfare and employment rights, but we do not have to do that by exactly the same mechanism as everybody else. That is what regulatory alignment means.
Then (Col 900) answering Antoinette Sandbach:
The presumption of the discussion was that everything we talked about applied to the whole United Kingdom. I reiterate that alignment is not harmonisation. It is not having exactly the same rules; it is sometimes having mutually recognised rules, mutually recognised inspection and all that sort of thing. That is what we are aiming at.
Then to Mark Pritchard (Col 901) asking if it was possible to leave the single market and the customs union, yet have UK regulatory alignment?:
As I said to my hon. Friend the Member for Eddisbury (Antoinette Sandbach), yes, but using things such as the mutual recognition and alignment of standards. That does not mean having the same standards; it means having ones that give similar results.
There are some who think the fudge was an attempt at creative ambiguity just to get a bit further along the path but I'm not necessarily convinced the EU or the Irish would see it this way.
All of Davis' words will be picked over in detail by Brussels as well as by hard Euro sceptics. The Commission may see it as the UK trying to wriggle out of its commitments and they may harden up the wording next time. It is in any case the latest manoeuvre in kicking the can down the road rather than face up to the problem. We want to be free of the EU with different standards that achieve the "same outcomes" and have the EU recognise them as acceptable, even down to agreeing mutually acceptable inspections - and presumably mutually acceptable enforcement mechanisms although he didn't mention it.
Think about this. Davis is suggesting we recreate the EU Acquis in UK Law, which the Withdrawal bill does, but then change things as we wish to a different form - but have the EU accept it as equivalent. This might even be possible but what do we do if they don't accept it? Does the EU have a veto? Do we consult them on every change? What is the point of leaving? These are the questions that hard Brexiteers are now asking. The government still wants to have its cake and eat it.
Robert Peston has a Facebook post (HERE) which makes some interesting points, the final one being this. If we want a close trade deal with the EU like CETA, it will require permanent economic convergence. Johnson, Gove and the hard Brexiteers will not like it but trying to exit without a deal would almost certainly be blocked by parliament and the result would be no Brexit at all. What a mess they're in. They've gone from having and eating cake to Hobson's choice!
And finally, the UK position paper on the border (HERE) talks on page 15 of "preventing the creation of new barriers to doing business within the UK, including between Northern Ireland and Great Britain" and "ensuring there is no requirement for product standards checks or intellectual property rights checks at the [Irish] border". If there is a divergence of regulatory standards either in NI or the UK between us and the Irish Republic, then it would hardly be in the spirit of our own position paper. Note also that someone foresaw the possibility of a border in the Irish Sea a long time ago.
