“Following a decisive result in the UK referendum of 23 June, Brexit is now a reality. Albeit only a reality in principle, with no timetable and no proposed form for either the exit, nor a new relationship with the EU,” Huntingdonshire’s MP Jonathan Djanogly.
“From my viewpoint, although I campaigned for Remain, the people have now spoken in a Referendum approved by Parliament. Now is not the time to bury our heads in the sand. We politicians need to negotiate the best Brexit deal we can get for the UK.
“Given that almost half of the UK’s overseas trade is with the EU, one can only assume that some form of relationship will be desired by both parties. The caveat here is that any deal would need unanimous approval; and it would therefore be easy for a single EU member to place, what is sees to be, the integrity of EU membership above, say, Germany’s wish to continue selling its cars to the UK.
“To leave the EU a member state must unilaterally invoke Article 50 of the Treaty on EU. Whilst EU leaders are insisting that activation occurs without delay, they do not seem to have the legal basis to force this. Prior to the referendum the Prime Minister said, on several occasions, that he would immediately activate Article 50 in the event of a Leave vote. However, he has now reversed his position on this and has said that the timing will be an issue for his successor, who will be elected by Conservative Party members, by 2 September. In the meantime, business leaders have vocally shared EU leaders’ concerns for instability and indecision arising from delay.
“However the chance of internal Conservative or Labour Party pressure speeding up the process seems remote, not least because the main opposition Labour Party is itself in a state of turmoil with many of its MP’s pushing for their own leadership election.
“With 7,500 Acts of Parliament containing European law, the complexity of exit, let alone forging new trade relationship with the EU and some 50 other countries, should not be underestimated. Estimates vary, but some civil servants foresee 25 Bills every year for the next decade. Whilst a civil service Brexit team was announced on 27 Jun, some are suggesting that an entire new government department may now be required. This assumes that the UK civil service has the expertise necessary eg for trade deals, which is unlikely given that all such deals have been negotiated by the EU since the mid 70s.
“The major question will be whether the new UK administration will wish to proceed to Brexit on the basis of retaining access to the single market, with its cost and freedom of movement requirements. This is likely to be the major issue debated by a House of Commons that was of course approximately 75 percent on the referendum Remain side. Likewise this same statistic is likely to mean that the incoming Prime Minister, who is probably going to come from the Leave camp, will have carefully to listen to MPs. This is reinforced by the UK’s new fixed term Parliaments, which has meant the end of a Prime Minister being able to resolve such an issue by calling a General Election. Now, a two thirds majority or no confidence vote is required for an early election and neither is likely. So a deal will need to be done that keeps most MPs content.
“In practice the two year negotiating period, after which the UK will cease to be a member, may well not be enough to conclude future trading arrangements. Accordingly, many commentators believe that transitional arrangements will be put in place aimed at minimising damage to business and trade. Such a deal could result in some kind of free trade area. The Leave campaign did outline plans to repeal some EU laws before Article 50 is activated. However, in the cooler dawn of post-Brexit UK, these suggestions have been down played following the threat from Brussels of retaliation.
“During the Brexit process we shall need to keep under review pressures emanating from within the remaining EU members. Will other member states have referenda? Will freedom of movement become less of an issue, by reason of other EU member states requiring changes to their own immigration policies?
“Outside influences could also push the remaining EU states to speed up a deal with the UK; say in response to resurgent aggression coming from Russia.
“There are a lot of loose ends and uncertainties involved in the Brexit process – all of which will be worrying for business and detrimental to UK inward investment opportunities. But that is where we are. There is no going back now.”