The chancellor, along with a number of his cabinet colleagues, appears to be swinging round to the view that more than two years is going to be required for Brexit. This may be unnecessarily dangerous territory both for us and the EU 27. And it’s an unnecessarily long timetable too.
When we joined the Common Market in 1973, we made huge changes to our trading arrangements, as our trading partners shifted from being the Commonwealth to Europe. There were massive changes to agriculture and fisheries. We had to alter our tax system radically from the old Purchase Tax system to VAT. And we decimalised our currency at the same time too.
All these changes were accomplished within about a two year period because the political establishment wanted to make joining the Common Market a success. Half the reason for the present prevarication is that too many Remainers are involved who are not really on side. We need more of a can-do attitude and less harping on how difficult it all is.
There is clearly a case for getting the Brexit negotiations concluded as soon as possible. The only significant economic downside to the EU referendum vote so far has been some signs of a fall-off in investment for which uncertainty must be part of the cause.
As long as we are in the EU, we run up costs of £250m a week, which obviously we must avoid if we can. So we need to get negotiations completed within the two year period, which may well mean within 18 months, allowing for a period of time for ratification. What can we do to make sure this happens?
First, having a relatively tight deadline will concentrate the minds of the negotiators. The longer the time available, the longer it will take. This will not make problems easier to solve. It will just provide an excuse for putting off tackling the difficult issues.
Second, we need to ensure that negotiations on the arrangements over our leaving the EU run concurrently with discussing what will happen after we have left. It makes no sense to run these two aspects of Brexit consecutively, wasting time which is in no one’s interest.
Third, we need to keep it as simple as we can, building on well-established existing trade arrangements instead of creating new ones, unless, in a few cases, these are absolutely essential. If – as will probably happen – we finish up outside the Single Market but with a free trade deal, all the necessary alignments of standards, for instance, will already be in place.
Fourth, where there are unavoidable complications, we need to carve them out. There may be some loose ends at the end of the two year negotiation period where transitional arrangements may be needed, but this does not mean that a permanent deal covering most aspects of Brexit cannot be in place by then.
Finally, there are many areas which do not involve trade but where we have common interests with our near neighbours – on everything from anti-terrorism activity to aviation, and from armaments procurement and military co-operation to education programmes such as Erasmus. There should be no big problems about all these mutually beneficial programmes continuing, albeit on an inter-governmental basis rather than as part of the EU’s overarching political project.
When Norway voted not to join what was then the European Economic Community in 1972, it took less than eight months for the Norwegians to negotiate a trade deal to replace full membership, which their referendum had rejected. We need to take a leaf out of their book. If they could do it swiftly and efficiently, then so can we.