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63 About this deal
The BCG report also rightly highlights that the impact of Brexit has varied between sectors, identifying pharmaceutical and automotive industries as amongst those where Brexit “is likely to have been a major factor in reducing trade”. Perhaps the most important distinction to be drawn is between large and very large businesses, on the one hand, and small and medium-sized enterprises (SMEs) on the other. The reasons are fairly obvious. Larger firms had the resources to plan for and implement the changes that Brexit brought, and were often more likely to already be familiar with procedures for trading outside the single market. Moreover, Frost fails to mention that, until July 2020, the UK had the possibility of seeking to extend the Transition Period, something which the EU would almost certainly have agreed. Doing so would have helped the UK to deal with Covid, by taking away the urgency of the negotiations and the imminency of the changes that the end of the transition would bring. It would also have helped the UK to deal with Brexit, by deferring completion of the trade deal until the exigencies of the Covid emergency were over. For although the focus of attention arising from the Hallett hearings is how Brexit got in the way of dealing with Covid, it is equally the case that Covid got in the way of dealing with Brexit. For Frost to use the Transition Period as a defence against there having been such mutual impacts whilst ignoring his government’s refusal to extend the period, which would have reduced or contained them, is absurd. Britain’s 2016 vote to leave the EU divided the nation, unleashing years of political turmoil. Today, many remain unreconciled to Brexit whilst, in a tragic irony, some of those most committed to it are angry and dissatisfied with what was delivered. The first step in this will be facing the fact that, economically, Brexit has been, and will continue to be, deeply costly. The headline figure, re-iterated by the head of the Office for Budget Responsibility (OBR) last weekend, is of GDP being 4% lower than it would otherwise have been, a bigger impact than the Covid pandemic. It’s not a new figure or comparison: the OBR said the same thing in October 2021, and it continues to do so with 18 months' more data. Moreover, this figure is built in to the government’s own budget calculations.
The book depicts the relationships and conflicts between these characters unfolding over the days they spend together in the house and surrounding area, with Dover and its cliffs again having quite different resonances for the various characters, especially Cecily and Diana. Alongside that depiction there are the ‘interior monologues’ of Cecily, Diana, and Victoria. Of these, Victoria’s is the most straightforward and contains her reflections on, especially, Cecily and their shared childhood, as well as on the other characters in the book and on her former boyfriend. That elision is evident not just in the rough and tumble of anonymous social media slanging matches and newspaper columns like that of Allister Heath, mentioned earlier, but in the writings of populist intellectuals. For example, in last week’s Mail, politics Professor Matthew Goodwin managed to run together issues as diverse, yet predictable, as Brexit, the paucity of further and technical education, the ‘over-representation’ of ethnic minorities in TV shows and adverts, and, of course, “’woke’ policies in our schools [and] universities” to propose that “there is a yawning gap between the values of the New Elite and the majority”. Much of this Conservative populism has nothing to do with Brexit directly, and many of its causes and tropes long pre-date Brexit. However, Brexit is now its touchstone, being both an article of faith and the one occasion when one of its causes was voted on and won. That strengthens the longstanding populist idea of speaking for ‘the silent majority’, and by a kind of osmosis the narrow vote to leave the EU became configured as ‘the will of the people’ and then ‘the will of the people’ for Brexit got repurposed to present many other populist causes as if they, too, bore the imprimatur of having been subject to ‘the biggest exercise in democracy our country has ever seen’ (sic).It's also important to repeat that all these studies do seek to strip out Brexit from other effects, and in doing so they recognize that the UK economy – including the specific issues of trade performance and productivity – faces many challenges other than Brexit, including some that pre-dated Brexit. This matters when reading, for example, another recent report, this time from the Boston Consulting Group (BCG) about UK trade performance and policy. For this report, whilst making many good points about the non-Brexit challenges, still finds it necessary to repeatedly make the strawman claim that “most commentary” ascribes the challenges facing UK trade to the single factor of Brexit. In fact, it is hard to think of a single serious commentator on trade or economics who does this, and, manifestly, the NIESR, OBR and CER do not.
They allow businesses to claim substantial national insurance and tax reliefs and to access particular government grants, as well as offering a more ‘supportive’ – for which it is probably fair to read one-sided – planning system. This is misguided in two ways. One is that although big firms may be better placed to deal with Brexit this doesn’t mean, as McBride blithely puts it, that they “can easily absorb any additional costs”. It is rather that, as Allianz Trade’s Head of Economic Research recently said, Brexit has “become a structural hurdle for UK exports” (the same is true of imports, and will become even more so if the latest promise to introduce UK-EU import controls next January is kept). Many big firms may indeed ‘absorb’ these costs, but they are still real, impacting on competitiveness, prices, employment, tax base or any number of other things. But it is also misguided because of the particular economic, social, communal and, indeed, emotional and psychological costs of Brexit’s impact on SMEs.Whilst Johnson is the most obvious culprit here, the same applies to his entire administration, including his feeble and mediocre Cabinet and his team of arrogant and bumptious Vote Leave Special Advisors, both during and after the Cummings’ period. If, as the Hallett evidence so far suggests, the entirety of this administration suffered from multiple deficiencies in handling Covid, then it is inconceivable that it became super-competent when dealing with Brexit. And whilst it might be said that the pandemic was a wholly unusual and complex problem, the same is true of Brexit. If they differ, it is not in that but in the fact that Covid was a crisis imposed on the UK, as it was on other countries, whereas Brexit was imposed by, indeed created by, the Brexiters, many of whom were by this time running the country. So they were incapable of dealing with either, but with Brexit they had the added culpability of having caused it. The second proposition is more easily discredited. The UK’s new Freeports are nothing like Charter Cities. The only connection between them is that both are a kind of SEZ. But they are of totally different sorts. The Cost of Living Crisis Byline Times investigates the causes and consequences of Britain’s biggest recession for 30 years
I would suggest that both of these positions are misguided and, certainly, that they will need to change if we are indeed to enter a new chapter. We have left the EU, and for so long as that is the case there will be questions about specific regulatory alignments and divergences (if only as EU rules change). These need to be considered on their own merits, not in terms of the fact of them being alignments or divergences. In other words, they need to be decoupled from having left the EU. Equally, they should be decoupled from the possibility of re-joining the EU. If and when there is a strong and durable political consensus to re-join, that will entail a process during which there will be plenty of time for convergence (just as for any acceding country) or re-convergence. So long as that consensus exists, then divergence will not be the barrier re-joiners fear and Brexiters hope*. Sometimes, the profiles in the EM report are painful to read, as with that of Carol, who ran a niche bridal lingerie business in Devon. The last line is “Brexit was the final nail in the coffin of the business” (p. 12). Or that of Darren, who ran a specialist motorsport vehicle engineering firm in Cornwall and Essex. His profile concludes “our business is finished” (p. 17). These are affecting, personal stories of individual dreams shattered, whilst at the same time implicitly telling of damage to whole families and to local communities, often in ‘left-behind areas’. Entirely unsurprisingly, the Charter Cities idea – which has spawned various think tanks and lobby groups – is strongly supported by a whole swathe of right-wing, free market libertarians. Equally unsurprisingly, there is much overlap in membership between the groups specifically focused on Charter Cities and many of the generalist think tanks of the free market right, including those within the UK. And, once more unsurprisingly, many of those individuals and think tanks are very pro-Brexit and very influential with the Government and with individual Conservative politicians. For, as we might expect from so seismic an event, Brexit has already spawned a wide array of novels and ‘the Brexit novel’ has become almost a genre in its own right, with at least one postgraduate research thesis having been written on it, and no doubt more than one. And, whilst I certainly have no pretensions to be a literary critic, I have long been interested in ‘Brexit novels’ both as manifestations of Brexit and as ways of understanding it, having, for example, been delighted to have been one of the speakers at the launch of my former colleague Bob Eaglestone’s edited book, Brexit and Literature. This has not happened suddenly. It began to emerge early in the Brexit process, and by October 2017 I was writing that Brexit was “becoming a battle for Britain’s political soul”. At that time, that may have seemed like hyperbole, or at least pessimism. Seven years later, it seems almost a truism.
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It has become increasingly difficult to separate out Brexit as a topic from British politics generally, and the politics of the Conservative Party in particular. That has been true for a while, but brought home with force this week with yet another outbreak of the Tories’ long-running civil war. It is a war in which Brexit features as both cause and consequence and, whilst it may have begun with a relatively genteel skirmish between ‘Eurosceptics’ and ‘Europhiles’ in the Tory Party, it has now become a full-blown culture war which has spread way beyond the party, or even Westminster politics. Even before the week’s later events, I felt that this was a questionable reading. Sunak came to power on the basis of being competent and offering stability after the Truss meltdown, and he has sometimes kept to that script. That’s especially so as regards Brexit, where agreeing the Windsor Framework and effectively dropping the scrapping of Retained EU Law were pragmatic, sensible steps which, of course, infuriated the Brexiters. The same goes for re-joining Horizon, effectively scrapping UKCA marking, and other decisions. However, he has consistently been inconsistent, if that is not a contradiction in terms, in that in other ways, especially in his prioritization of ‘stopping the boats’ and his de-prioritization of net-zero policies, he has embraced Brexitist populism. In practice, it isn’t actually clear that these new Freeports will differ in any significant way from those allowed under EU law. The Government claims the UK Freeports will allow more subsidies to business than as an EU member, but the evidence for that is disputed. Apart from that, the new Freeports differ from those the UK used to have in two main ways, but neither of them required Brexit.
Subsequently, eight Freeports have been approved in England. In effect, they combine features of long-familiar Enterprise Zones, regional development policy and ‘classical’ Freeports. Discussing those damages is still largely taboo for both the Tory and Labour parties but, to coin a phrase, the people have spoken, at least to the extent of successfully petitioning parliament to debate a call for the government to hold a public inquiry into the impact of Brexit. The debate will be held on 24 April, and whilst little can be expected as a result it is at least something that Brexit will actually be discussed and not treated as an embarrassing medical condition that shouldn’t be mentioned in public. The Brexit fever may have broken, but the nation is still ill.But for hard core Tory Brexiters, the loathing of Cameron goes far deeper than that. Even before the referendum, many of them regarded him as ‘not being a real Conservative’, meaning too socially liberal, too green, too metropolitan, too globalist. Before Brexit, that was still perhaps a relatively marginal view, but the Conservative Party now is very different even to that of 2015 or even 2017. Brexit saw most of the more centrist and socially liberal Tory MPs expunged or marginalized, and Brexit itself has now morphed from just being about leaving the EU into Brexitism or Brexitist populism.* The more the UK approaches each of these issues as discrete policy questions in their own right, rather than via support for or opposition to Brexit, the more politics will have been ‘de-Brexitified’. If we get to that point, then we will be at the end of the chapter which, arguably, we are now just starting with the adoption of the Windsor Framework. Brexit will be less toxic and simply less ‘present’, something also aided by the passing of time and, with that, of the leading Brexiters and many leave voters.
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