A return to the ‘squabbling sixth formers’ style of politics in Downing Street this week, as the newspapers filled up with Boris Johnson’s WhatsApp messages and Dominic Cummings’s blog posts. Those suffering from a lockdown-induced lack of gossip within their own circles of friends might enjoy this piece, which sets out some of the petty rivalries at work at the heart of government.
What the fallout of all the ‘he said, she said’ stories will be remains unclear. But clearly important decisions about the Irish Protocol remain to be decided, and these distractions are not helpful.
“Dom, why did you tell everyone my secret?” “It wasn’t me, Boris, it was Henry, honest.”
Meanwhile, more important news arrived in the form of an underreported interview which Johnson gave to BBC Northern Ireland, in which the Prime Minister refused to rule out using Article 16 of the Irish Protocol to make necessary changes to the customs border in the Irish Sea. We publish a full transcript of the interview on our website.
It is good to see that the Prime Minister is keeping his options opens, although it seems that he remains committed to ‘sandpapering’ the Protocol, rather than making any more fundamental change or removing it entirely. This suggests that the PM continues to underestimate the problems posed by the current arrangements.
Serious sandpapering still not enough
We will be watching to see if there is any change in Johnson’s tone on the Protocol following the ratification of the EU–UK Trade and Cooperation Agreement, which is expected later this week. There remains a real danger of the UK being pushed to accept closer alignment with EU regulations. The government needs to stay focussed on ensuring Britain is able to chart its own independent path, trading with the EU as an equal partner.
This week BfB co-editor Robert Tombs took part in the UK in a Changing Europe’s ‘Brexit and Beyond’ podcast. Robert discussed geography, trade and what impact Brexit might have on Britain’s foreign and defence policy with the podcast’s host, Professor Anand Menon.
On the website this week
BBCNI Interview with PM includes promise to use Article 16, by Briefings for Britain
Last week the BBC Northern Ireland flagship current affairs programme ‘Spotlight’ ran an hour-long TV programme entitled ‘A Contested Centenary’. This included a few snippets from a long interview with Boris Johnson conducted by the Spotlight presenter, Mark Davenport. The snippets unaccountably ignored the PM’s important statement that the UK Government refused to rule out using Article 16 of the NI Protocol to make necessary changes to the customs border in the Irish Sea. This repeats a similar comment made in Parliament by the PM much to the alarm of the EU. The full text of the interview is on the BfB site.
“If we have to invoke Article 16 because we think that this thing isn’t working in the interest of the UK and isn’t working in the interests of NI then that’s what we’ll do.”
Regulating Future UK Referendums, by Robert Jackson
It remains to be seen whether the result of the Scottish Assembly election on May 6th will enable the SNP to proceed with its plans for an unconstitutional second referendum on Scottish secession. But the arrangements for future UK referendums in general raise important issues, notably in Northern Ireland, which are here addressed by Robert Jackson. Meanwhile, if the SNP gets the majority it seeks, his proposals provide an alternative to a direct confrontation between the British and Scottish governments concerning “Indyref2”.
“Bluntly, a principle of “informed consent” should be applied in all referendums.”
ThinkScotland’s Assessment of the SNP Record in Government, by Briefings for Britain
We publish this article to highly recommend a new report from THINK SCOTLAND. The report concludes that the SNP, despite being in power over the last 14 years, has a record of failure in every policy area. This article briefly summarises the main points from the report. The report is available here.
“This report sets out that far from the “progressive” politics that the SNP claims to represent, the Scottish people have suffered in many key areas of life under SNP government”.
Key points this week
Further Issues with the Northern Irish Protocol
Although readers may be tiring of Northern Irish news, the Protocol really is the site of much Brexit-related negotiation. Although violence abated in Loyalist circles out of respect for the death of Prince Philip, tensions remain high.
Amidst all this it’s strange to see British commentators that Ulster will benefit from these arrangements. While it’s of benefit for Northern Irish producers that they can sell with no red tape to the European Single Market, that comes at the expense of masses of red tape imposed on trade with the rest of the UK. And Ulster, overall, trades predominantly with the rest of the UK rather than the EU.
This handicap is particularly acute for agricultural and medicinal suppliers, who are faced with the looming prospect of being unable to source supplies from the UK, obliging them to re-orient their whole supply chains.
More mystifying is the statement of UK expert Shanker Singham that some measure of SPS alignment between Northern Ireland and the Republic is essential for a low-checks border to function. In reality, the only goods produced in Ulster that need in principle to comply with EU regulations are those actually heading south of the border: not those for internal consumption.
These are the only true goods ‘at risk’ of entering the single market.
To those commentators who suggest otherwise, it’s been pointed out that a customs border and checks between the UK and the Republic already existed before the referendum. Goods like cigarettes and alcohol have been historically taxed differently in UK and Ireland, and police have thus always had to monitor their movement.
Extending this light-touch regime poses neither a threat to the Single Market nor to the Good Friday Agreement. That this has not yet happened is a monument to EU intransigence (abetted by the UK civil service’s enthusiastic over-enforcement of the rules). If Boris Johnson is to safeguard peace and prosperity in Ulster and the interest of the Union, the Protocol needs fundamental reform of its scope and implementation.
Shadow Boxing with Investment Figures
In its weekly ‘Brexit Briefing’, the Financial Times discussed British companies’ investment in the EU. The paper represented this process as representing a significant external investment. Yet it didn’t put a number on EU investment into the UK, suggesting it was likely to be lower than previously given the UK economy’s lesser importance compared to the size of the continental market. Yet although the UK economy is smaller, Britain does have a net trade deficit with the EU, giving European companies similar incentives to invest.
The FT’s argument that investment has fled the country cites a 2020 LSE study on FDI flows, which compared inward investment to the UK with a hypothetical Remain outcome. Yet such models are notoriously unstable, and attempting to refute such phantom projections is more akin to exorcism than economics.
The study’s decision to use the number of FDI transactions as the measure of inward investment, rather than their size, is also revealing. Nearly the whole increase in UK to EU investment found by the report is driven by services (pp. 16-17). As the authors hint, this is essentially because it’s easy for firms selling financial or legal services to set up a ghost European office, and carry on business as usual from the UK. This in turn counts as an investment transaction – just not a very important one.
Most of these transactions are also greenfield set-ups rather than acquisitions of existing firms, supporting this hypothesis. Although the authors briefly address this issue by stating that the ‘average’ number of jobs created per investment hasn’t changed post-referendum, both the type of average they’re referring to (mean, mode, median) and the sources and methods of calculation are unclear.
Although a few thousand jobs have moved (and the nominal home of traded shares), this pales in comparison with the continuing prosperity of the City’s financial services sector. Though less fantastic than the now-debunked exaggerations of ‘Project Fear’, estimates of hypothetical losses of kind made by LSE and the FT are nonetheless better viewed as political positions, rather than economic realities.
Key Points is compiled by a Cambridge PhD student.
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How you can help
There is much about Brexit still to be decided. Our MPs listen to their constituents. Do continue to send them links to our articles, especially on matters relevant to your constituency – for example, in rural areas, articles on the threat to British agriculture. Alternatively, make an appointment to speak to them at their next surgery. Let them know what you want post-Brexit Britain to look like.
As Boris Johnson said in in his post-election address, it is also time for unity and reconciliation. Keep reading our posts and share links to our quality content to help others understand how leaving the EU will be good for the UK economy and for our own democratic governance. We aim to educate our critics to think differently and more positively about the long-term impact of Brexit.
An Oxbridge PhD Student
Dr Graham Gudgin
Economist, Centre for Business Research, Judge Business School University of Cambridge
Professor Robert Tombs
Emeritus Professor of French History, University of Cambridge