BREXIT: Labour makes a move but is it in the right direction?



By Brendan Donnelly, Director, The Federal Trust

1st September 2017


The recent article by Keir Starmer, Labour spokesman on Brexit, setting out the Party’s commitment to continued British membership of the EU single market and the customs union for a transitional period post-Brexit is a welcome and significant development in the European debate. In the short term it will give Labour a political and intellectual basis on which to criticize the government’s conduct of the Brexit negotiations, particularly in relation to the form of the transitional period to which the government is now committed. It would be overoptimistic however to claim that the Starmer initiative represents a comprehensive or sustainable approach to Brexit over the longer run. “Constructive ambiguity” stays in place, even if it is now more intelligently constructed.

It had obviously stung both Starmer and Jeremy Corbyn that since the General Election Labour was regularly and rightly accused of pursuing a Brexit policy factually indistinguishable from that of the Conservative Party. This overlap was all the more surprising given that some 70% of Labour supporters at the last election favoured remaining in the EU. Labour’s caution stemmed partly from Corbyn’s long-standing personal hostility to the EU and partly from the reluctance of Labour MPs representing constituencies with majorities for Brexit to be seen as challenging the EU referendum’s outcome. It has, however, become increasingly clear that if Labour lost some votes in its traditional heartlands to the more Eurosceptic Conservative Party, it gained many more elsewhere from pro-Remain voters who wanted it to oppose either the principle or the modalities of Brexit. Before Starmer’s recent revised approach, the Labour Party was at serious risk of losing the support of these latter voters. This revised version of Labour’s European policy will be a substantial consolation to potential waverers. Nor will it harm Corbyn’s chances of becoming Prime Minister in the next two years if he can be seen as the voice of moderate reason in regard to an orderly Brexit, in stark contrast to Theresa May’s self-destructively ideological approach. Starmer deserves the congratulations of his colleagues for having given forward motion to his Party’s becalmed European policy. But in what precise direction?

It is worth recalling that nowhere does Sir Keir even hint that it might be in the UK’s best interests to remain within the European Union, a view which he and the great majority of his Parliamentary colleagues (not just on the Labour benches) undoubtedly retain but are too timid to articulate. Sir Keir and Labour are still a long way away from any willingness to reassert traditional conceptions of Parliamentary sovereignty against a small referendum majority, won only on a dubious franchise and after a strikingly dishonest campaign of mendacity and intellectual confusion. This reluctance to strike at the root of the matter, to proclaim that any form of Brexit would be at least highly damaging and probably disastrous for the UK, brings with it two fundamental long-term weaknesses in Labour’s new European policy.

It is now common ground between the Labour and Conservative parties that there should be a transition period starting in March 2019. The present apparent controversy about whether during this period the UK remains in the customs union and the single market (advocated by Sir Keir) or not (as advocated by the Fox/Hammond axis) may well turn out to be artificial. If any transition arrangement is eventually agreed between the EU and the UK it can only be on the basis of objectively minimal movement away from the status quo in regard to the customs union and the single market. The EU will tolerate nothing else and continuity can only be provided for British economic operators by some such arrangement. Whether this continuity is presented as the UK’s remaining temporarily within the customs union and single market or described in some other fashion is in essence a secondary question. If the Conservative government is serious about wanting a transitional period after 2019, it will inevitably be along the lines now sketched out by Labour. Labour may well find the sharpness of the differentiation it hopes to establish between itself and the government blunted by the genuine concessions and verbal obfuscation that will accompany any worthwhile transitional arrangement.

More critically, it is clear from Sir Keir’s article that he shares many of the confusions and illusions of the current British government in regard to the relationship that can reasonably be expected between the UK and the EU after Brexit. The controversial details of the transitional agreement pale into insignificance beside this shared misconception. Sir Keir speaks for instance vaguely of the possibility at the end of the transitional period of continuing in “some form of customs union” with the EU. Theresa May could not have expressed this particular thought more vacuously. At the end of the transition period, the UK will in reality either remain within a customs union with the EU as it is now, or it will not. If it decides to leave the customs union it will need to negotiate, painfully and from a position of great weakness, a new arrangement to replace what it has given up in the way of facilitated trade with the EU. This arrangement cannot but be a less favourable one than that presently enjoyed by the UK. To attempt to conceal this painful reality under the reassuringly imprecise vocabulary of “some form of customs union” is worryingly to echo the self-delusions of the current British government.

Similar wishful thinking is contained in Sir Keir’s claim that at the end of the transitional period a Labour government will be able to  decide whether the benefits of the single market can “best be retained” by a “new single market relationship” or by a “bespoke” trade arrangement. Our EU partners must wonder whether anything they have ever said about Brexit has ever been heard, much less comprehended on this side of the English Channel. These partners have made it very clear that there is only one way to retain the benefits of being in the single market and that is by being in the single market. Equally, the only way to retain the benefits of a customs union is to be in that customs union. It is more than unfortunate that Sir Keir repeats the incantation of the Labour manifesto at the last general election, that the party seeks a long term arrangement which “retains the benefits of the customs union and the single market.” No such arrangement will ever be on offer and it is no service to the British people to suggest otherwise. One step forward by Starmer on the necessity of remaining in the single market and the customs union during the transitional period has sadly not been accompanied by any steps forward regarding the post-transitional period.

It may well be that in reality the present controversy about the nature of any transitional arrangement after 2019 is anyway confounded by events. The Brexit talks may never proceed to the second phase in which such issues are due to be discussed. Even if this phase is eventually triggered, there is no guarantee that an agreement for a transitional period acceptable to both sides can be achieved. In that case, Sir Keir’s tactic of positioning the Labour Party as the advocate of “soft Brexit” will stand it good stead as it rails against the extremism of an obsessive Conservative government committing the UK to the hardest and most chaotic of all conceivable Brexits. But Sir Keir and his colleagues will still be confronted with the question of what they want to be the UK’s final relationship with the EU, be it in 2019, 2021 or 2023.

Increasingly, continental observers are coming to understand that the fundamental weakness of the British government’s underlying approach to Brexit is that it wishes to leave the EU but does not want to accept the consequences of doing so. This insight explains the scathing references to “magical thinking” coming from Brussels and elsewhere. Some of his supporters will argue that Sir Keir is aware of and even privately shares  this criticism. His goal, say these supporters, is gradually to edge his party toward a more realistic understanding of the Brexit negotiations, keeping open, but never mentioning explicitly, the possibility of a final rejection of whatever Brexit terms the Conservative government puts to the House of Commons. But if that is Sir Keir’s long-term intention, he is going about it at a dangerously glacial pace. There is every chance that the Brexit negotiations will have been chaotically terminated and the UK will have left the EU under the automaticity of Article 50 before Sir Keir has concluded his gentle pedagogic efforts to educate the Labour Party and its supporters. Lessons taught or learned too late are no better than lessons not taught or learned at all.