Friday 7 February 2020

Divergence and red tape

In 2018 I had an exchange of emails over several months with Nigel Adams' office about the regulations that he said Britain had been forced to accept and which must therefore I thought be a priority to be repealed after Brexit.  I first asked for a list and got nowhere.  Then, I simply asked for the top one, just one. It was all to no avail, I couldn't get an answer. It's clear he didn't have a clue.

So it was no surprise yesterday morning to see the FT reporting that Sajid Javid is proposing to ask members of the public which EU rules they want scrapping! I assume they've already been round MPs like Adams and all the departments in government and perhaps were shocked to find nobody could think of any rules that could be jettisoned. Perhaps Brexit has all been on a simple misunderstanding?  No, the net just had to be cast much wider. This is the FT:

"Chancellor Sajid Javid will use his Budget next month to launch a “Brexit red tape challenge”, inviting members of the public to propose ways in which Britain might diverge from the EU rule book. The concept of the UK diverging from EU regulations is at the heart of Boris Johnson’s Brexit policy but, more than three and a half years after Britain voted to leave the EU, ministers have yet to articulate exactly what they mean". 

First of all, I am not sure any member of the public has the faintest idea about EU regulations anyway.

And even if they do manage to rise to this red tape challenge and send in the rules we want unshackling from I'm convinced 99.9% will either be regulations that don't exist, are of our own making anyway or they are international obligations that we can't drop. I've always believed Johnson has a totally distorted view of what these regulations do and we'll find none of any significance can be thrown out.

The article itself quotes Michael Heseltine:

"Lord Heseltine said he ran his own deregulatory initiative in the 1990s and it failed to produce any '“significant' change because nobody could agree on what rules might be scrapped."

Oliver Letwin headed up another red tape initiative as recently as 2014 but if I look at the website today it says "this site is no longer operational". I don't remember any great culling of red tape coming from that either.

The public are always ambivalent about rules and regulations anyway. The Mail and the Tory party rail against them and the public lap it up. But as soon as there's a disaster, like Grenfell tower or coronavirus they demand 'something be done about it' and the newspapers then echo it. The problem is 'doing something' usually means more regulations. Strange isn't it.

From the FT again:

"In 1992 Lord Heseltine was charged by the then prime minister John Major to 'hack away the jungle of red tape' but he quickly discovered that trade bodies could not agree on specific measures in British law they wanted to repeal. “I waited with growing expectations but did not get a single reply,” he said. Whenever suggestions to eradicate red tape arose, ministers quickly recoiled when they realised they would be held responsible for any abuses that occurred when a rule was removed." 

“The difference between the jungle and civilisation is regulation,” he said.

This notion that business, uniquely in this country, is being crushed by senseless, unnecessary and burdensome regulations forced through the European parliament and the European Council against British wishes persists almost regardless how many red tape challenges or enquiries are carried out. It's like one of those dormant bacteria that keeps coming to life every so often. You can't kill it.

I suspect Javid's will end the same way.

Bizarrely, Liz Truss, Javid's underling is slavishly tweeting about the article and "cutting" red tape, seemingly unaware of the huge quantity of red tape that Brexit is about to reintroduce.
This article from 2019 quotes a cross-bench peer, the barrister David Anderson, noting that if Brexit was a project to scrap unwanted regulation, it was actually having the opposite effect, at least for those with any traffic with the EU.

"Today’s 'no-deal readiness report' [from October 9th] illustrates on page after page how our hard-won freedoms and those of other Europeans are to be throttled by new red tape, 28 years after Thatcher’s European Commissioner, Arthur Cockfield, achieved the Single Market on 1 Jan 1993 with the biggest bonfire of red tape in modern history," he said on Twitter.

So, creating the single market was the "biggest bonfire of red tape in history", now we are rebuilding it, presumably so some future government can apply a flaming torch and have another bonfire as we rejoin.  Until then, there won't be any cutting of red tape.

And even signing new trade deals won't help.  Look at this article in Politico:

"The main advantage of a Canada-style deal, from the British government’s perspective, is that it would allow the U.K. to leave the EU customs union and set its own tariff rates.

"This will create a whole new set of costs and paperwork for companies wishing to trade under such an agreement. These costs are so high that in many cases, companies prefer not to use the deal and just pay the higher tariffs.

"New data released by the Commission on Monday shows just how bad the problem can be. EU companies trading with Switzerland, an economy highly integrated with the EU’s, and which enjoys tariff-free trade under a deal but is not in a customs union with the bloc, only used that trade deal for 77 percent of their exports.

"That means exporters accounting for a quarter of EU shipments in value to Switzerland preferred to pay WTO tariffs than filling out the additional paperwork to use the deal."

In other words, the cost of completing and submitting the forms (i.e. the red tape) is, in some cases, more or not much less than the tariffs the trade deal is trying to avoid!

And someone with an eye for a hypocrite has noted a tweet also by Liz Truss but this time from June 21st 2016:

How right she was.