Shameless contradictions, cherry-picking and trade-offs … truth behind the departure plan

“The UK and the EU will establish a free trade area for goods.”

This is likely to be condemned by the EU as “cherry-picking”. Its famous four freedoms are goods, services, people and capital, and it doesn’t believe in separating them. Any discussion about goods is bound to morph into concessions and trade-offs involving the others, and this document signals the Government is willing to make them.

“There will be a common rule book for all goods including agri-food, with a commitment by treaty to ongoing harmonisation with EU rules.”

This is contradictory. A rule book suggests general agreement with standards that flow from it. Harmonisation means doing what you’re told to. The EU will want the latter, which would complicate Britain’s ability to make trade deals with other countries, given that it would prevent us from mutually-recognising the standards of non-EU trading partners such as the United States and Australia. It would also potentially prevent the country from liberalising its rules to provide more choice to consumers.

“Parliament has the ability to break from the EU’s rules on goods, recognising that this would have consequences.”

That sounds scary: how scary depends on how commensurate the consequences are with the goods affected. Say the EU draws up a new rule on vacuum cleaners and the British hate it and want to opt out of it. This could mean the EU removing the UK’s market access, potentially in completely unrelated areas. This would create a massive disincentive for a nominally independent Parliament to diverge from EU standards, especially given the vested interests that would be arrayed in support of the status quo.

“There will be strong reciprocal commitments related to open and fair trade.”

Conservatives could lose the right to reform environmental or employment “standards” – regulations that can affect British competitiveness or cause job losses. The fear will be that, under the headline of enforcing a “level playing field”, the EU will require the UK to keep the likes of the Working Time Directive and even adopt new regulations that limit the flexibility of the British economy. This would cap the economic upside of Brexit, while potentially further damaging our international competitiveness over time if the EU adopts ever more restrictive regulations.

“The interpretation and application of agreements will be done in the UK by UK courts, and in the EU by EU courts – with due regard paid to EU case law in areas where the UK continued to apply a common rule book.”

That’s all normal in international agreements. The challenge is handling the resolution of disputes. It’s probable that Britain will end up referring to the EU courts for final say, and they are notorious for interpreting law in a way that favours European integration.

“A facilitated Customs Arrangement will remove the need for customs checks and controls between the UK and the EU.”

This is intended to solve the Irish border problem, as defined by the European Union. We want to be able to set lower tariffs than the EU to promote trade, and the EU is still waiting for us to explain how we’re going to manage the movement of goods through the UK and EU markets. The mechanism is not explained fully here. Experts nevertheless fear the Government’s favoured scheme will be a bureaucratic nightmare and limit trade growth.

“The UK’s services-based economy will enjoy regulatory flexibility”. This attempt to govern the trade in goods and services separately is, again, contrary to the EU’s determined position. The EU’s argument is that the value of a good is bound up with services – design, advertising – and so one cannot meaningfully regulate, say, the sale of a car without also determining the rules governing its marketing or, for that matter, the movement of someone from Poland to London to work as a salesman. This is why Brexiteers are worried that having made so many concessions on goods, this document foreshadows later concessions on services, capital and movement.

“The plan will deliver an independent trade policy.”

This is an ambitious statement to make at this point, given that it is highly dependent on the specifics of the customs plan, on the extent to which Britain is required to harmonise its regulations with those of the EU, and on the role of the European courts.

“The UK will leave the Common Agricultural Policy and Common Fisheries Policy”

This is one of the few positives of the plan. However, given that the Government intends to remain in the single market for agri-foods, it is unlikely that, even if we do achieve an independent trade policy, British negotiators will be able to gain better access to non-EU markets for British farmers. It is also unclear how much of our waters will in practice be returned.

“Free movement will end … The deal will include a mobility framework so that UK and EU citizens can continue to travel to each other’s territories, and apply for study and work.”

What a mobility framework is no one knows, but it tees up with what might be the next shiny giveaway to the EU: a big deal on foreign workers. The Government might argue that having reclaimed British sovereignty, it makes sense to cede a little back to the EU to attract necessary labour. But many voters backed Brexit to put full controls on migration and, let’s be honest, reduce it significantly.

“End vast annual payments to the EU budget”

This will be up for negotiation, but because of how close the Government hopes Britain to remain with the EU, Brussels will expect annual payments.