Gove told us last week in a written parliamentary answer that the UK government expected to publish a draft FTA before the next round of negotiations. Since this has now been postponed, at least at the tête-à-tête level we don't know if our draft will now be published or not. The EU meanwhile have also prepared a draft, all 441 pages of it and circulated it to member states. It is not public yet but some reporters have seen a copy. You can bet it will be more complete and better drafted than ours.
The Guardian report:
"The document stipulates that where there are disputes on state aid rules, the European court of justice in Luxembourg will be the arbiter of EU law and issue binding rulings to the British courts to implement.
"Where Brussels devises entirely new rules on state aid, whether to industry or farmers, a new joint committee will have to sit within six weeks and “add the new act or provision” or the EU would be free to implement “sanctions” that “have a real and deterrent effect”.
"The draft treaty also insists that the UK will have to guarantee “non regression” on EU regulations on labour and social protection despite its withdrawal from the bloc.
"On environmental standards, the EU insists that targets set by Brussels will also apply to the UK after it leaves the single market and customs union at the end of the year.
"The regulations referred to in the document include industrial emissions, air quality targets and nature and biodiversity conservation.
"The document also refers to harmonisation on “health and sanitary safety in the agricultural and food sector”, in a sign that the EU will resist changes to UK laws to allow the production of chlorine-washed chicken or hormone-treated beef."
In just one area, fishing, has the EU softened it's previous position. This concedes the annual quotas should be based on scientific advice rather than the status quo under the CFP. It looks like a minor victory if it is one at all.
Brexit Johnson's tactic of deliberately setting an extremely tight timescale is going to blow up in his face. There isn't time to quibble over details since in a normal FTA the legal 'scrubbing' exercise after the details have been agreed, can easily take six months. So, the text must be pretty legally watertight from the start and the EU are better prepared and more able to do that. As the clock runs down, the EU will point to the only legally acceptable text and we will be faced with a take-it-or-leave-it offer.
You may think the transition period will need to be extended. You may, like Dmitry Grozoubinski, think it's a no-brainer:
The EU will certainly demand money in return for granting an extension while we remain in EU agencies - perhaps another £12-15 billion for a whole year. But as Mr G points out, Rishi Sunak's budget makes it appear there is nothing the government can't afford, so no problem there.1/ An immediate extension to the EU-UK trade negotiations and the transition period is a no-brainer.— Dmitry Grozoubinski (@DmitryOpines) March 13, 2020
The compromises needed to make a deal have to be made at a political level. The mandates are irreconcilable technically.
Leaders are far too distracted to make good choices.
Of course we will ask for an extension. It is a no-brainer, although not yet in Downing Street which contiued to insist yesterday that we will leave the transition period at the end of December 'regardless of the outbreak' . We will not.
Local elections scheduled for this May have been postponed for a year already.
And the government is already planning a U-turn on banning mass gatherings of more than 500 people which is a bit late since many organisations, including the football league, had already announced such a ban, following the guidance of every other government in Europe rather than our own. This is what happens when there is no trust.
It is a recognition that fear is the big driver. Why attend a big sporting event and take the risk of becoming infected when you don't need to? People simply won't go anyway. There is already a marked reduction in footfall in restaurants, pubs and hotels. BA, like other airlines, will be cutting jobs next week because bookings are dropping like a stone. This is herd mentality rather than herd immunity, and will only get worse, much worse in my opinion.
The idea that we can leave without a trade deal, which I have always considered impossible, is even more remote now. Business, industry and employment will be considerably weakened by the end of the year so putting the economy through another massive shock is beyond even the most insane thinking.
In any case dropping out of the SM and the CU on WTO terms would automatically mean tariffs on a lot of UK goods which we would then spend the next few months and years trying to negotiate away. It makes zero sense.
Economic forecasts
In the OBR report on the budget it is clear that the Treasury asked them to stop "forecasts for the economy and the public finances some way in advance of the Budget – on 18 and 25 February respectively – so that it had a stable base against which to finalise its policy decisions.
The OBR said that the spread of coronavirus was at that time expected to be 'relatively limited', and 'the impact on the forecasts in this Economic and fiscal outlook was largely confined to a modestly weaker outlook for growth in world trade and the UK’s export markets'.
Hence, the budget forecasts were significantly out of date even before Sunak got to his feet last week. Anyone who thinks the huge sums of money he set aside to handle the economic fallout from coronavirus will be anything more than a fraction of the costs actually involved needs to have a long think. The hit to public finances will be at least as great as the 2008-9 financial crisis.
Covid-19 - the government's strategy explained
This is a nice explanation of what one professor thinks the government's Covid-19 strategy actually is. Ian Donald, in summary, believes while other countries are trying to prevent people getting the virus, the UK wants us to get it. The plan is to let coronavirus run through the population using what could be a clever strategy but is high risk with a number of key planning assumptions.
First, they want the infection rate to rise among low risk people so they acquire immunity and cannot infect others. When other higher risk people get infected, as they will, up to the capacity of the NHS to cope, they then want to control the infection rate so that it balances the people being discharged from hospital after treatment. In this way the NHS isn't overwhelmed and those needing treatment will be able to get it.
The professor says:
"The risk is being able to accurately manage infection flow relative to health case resources. Data on infection rates needs to be accurate, the measures they introduce need to work and at the time they want them to and to the degree they want, or the system is overwhelmed."
So, it might work or it might not. It looks like a big gamble so we shall see what happens.
But whether it's the economy or health, corona virus 2020 could be remembered as our generation's holocaust moment. We are on the edge of something very serious indeed.
