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Debates

The UK and Europe

May's deal v Norway

Jonathan Grant / Jan 2019

Image: Shutterstock

 

What type of Brexit would best reflect the will of the British people? It seems somewhat incredible that, with so little time left until the official date we are scheduled to leave the EU, there is still barely any consensus on the answer to this question. The debate seems so polarised and so tribal that it’s difficult to get an accurate picture of what the public actually want.

Back in October last year, we published research which attempted to remedy this. We asked a representative sample of the public about their Brexit preferences, but crucially stripped away any labels that might appeal to their tribal allegiances. We then forced them to make pragmatic trade-offs between different aspects of the UK’s future relationship with the EU.

Forget Remain, Canada, WTO and all the rest – we did away with such terms and made people confront the compromises that would necessarily need to be made when selecting their preferences: if someone wanted full access to the single market, for example, it would come at the expense of British sovereignty. We then used economic modelling to establish the results of all these trade-offs.

The Prime Minister’s deal was not on the table when our original study was published. So as we enter the Brexit endgame, with MPs voting next Tuesday on May’s plan, we’ve revisited our analysis to assess how much support it has among the public.

Remember: we are establishing this by examining people’s views of the constituent parts of her deal; no one was asked whether they supported the “May deal” or the “Prime Minister’s deal”, which could well have injected unwanted tribalism into the responses.

Breaking down the key components of the deal, we interpret it as assuming the following: a visa needed for holidays but no health insurance, no freedom of movement for work, access to the single market (with additional costs) for goods, no access for services and no contribution to the EU budget.

It is difficult to ascertain the scope for free trade deals, given uncertainty around the Irish backstop and limitations brought about by signing up to the common rulebook. For this reason, we estimate an optimistic and pessimistic assessment of support for the Prime Minister’s deal.

In the optimistic scenario we assume that the UK will be able to make its own free trade deals but with some sovereignty ceded in line with the common rule-book. In the pessimistic scenario we assume that future free trade deals have to include EU countries and that some laws continue to be directed by the EU (eg employment law).

The most pessimistic interpretation suggests that the May deal is the least popular of all the options we have reviewed. Taking a more optimistic assessment, we find that it is viewed slightly more negatively that No Brexit (although this is a very optimistic interpretation as it assumes that free trade agreements could be made with other countries after the transition period, which would depend on the long-term relationship with the EU).

So what is the most popular type of Brexit according to our research? Even including May’s deal as an option, membership of the European Economic Area (EEA), via the European Free Trade Area (EFTA), enjoys the most support among the British public, with 43 per cent of Britons favouring this option, up from 38 per cent in 2017.

This reflects the positive value that people placed on being able to make free trade deals with countries outside the EU, access the single market for trade of goods and services, as well as taking account of the smaller negative values they placed on freedom of movement and loss of sovereignty.

But EEA/EFTA brings other challenges: the UK would become a “rule taker” for the single market, membership involves freedom of movement across member states, and there will remain issues with the Irish border.

It is worth noting that EEA/EFTA’s focus is on freedom of movement for work, so it is not impossible that a treaty with the UK could reaffirm that EEA citizens must have a job in order to access public services. (Although it should also be noted that current EU laws allow for limits on how long EU citizens are allowed to stay without having a job and accessing public services).

Trickier would be the issue of Northern Ireland and how to avoid a never ending backstop. One possible solution would be to create a unique customs union on the island of Ireland with the EU27. The priority for the EU will be to avoid a repeat of the Chinese garlic scandal, where smugglers were using the EEA to avoid EU tariffs on garlic by shipping produce to Norway and then smuggling it across the Swedish border.

Given that a hard border between the Republic of Ireland and Northern Ireland is a red line for both sides, this implies that the customs union border would have to be in the Irish sea.

So it seems that EEA/EFTA membership remains a strong preference of the British people but it is not an option being presented to the country or Parliament. According to our research, it is a compromise that would have the backing of the British people.

What is more, a government of national unity offering a non-whipped vote on a deal along these lines is likely to garner a significant majority in the House of Commons. It is also a compromise that may allow us to heal as a nation.

 

Jonathan Grant

Jonathan Grant

January 2019

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