An interim deal to bridge the gap
Sir Simon Fraser opened his speech by explaining the three key deals he believes the UK will have to make with the European Union: one to exit (Article 50 of the Lisbon Treaty), one to secure our future, and one to fill the gap in between.
The first two are accepted as conventional wisdom, and the last – ‘the interim deal’ – continues to be debated. Fraser believes an interim deal, bridging the gap between leaving the EU and concluding a permanent deal, is inevitable. But what that interim deal would look like is far less certain.
The EU, he feels, is yet to ‘absorb the shock of Brexit’ and is not yet thinking deeply about the future. With 27 member states and three key institutions, its side of the negotiations will be incredibly complex – hence concluding a permanent deal in 2019 is highly unlikely.
The Great Repeal Bill will provide the legal foundation for an interim deal that extends our current membership terms. Any deal seeking to alter these terms would require a whole raft of additional negotiation.
The build up to negotiations is about positions and posturing
For Fraser, the ‘hardening’ of positions in both Westminster and Brussels over the last month had been no surprise – this was a typical dynamic for a pre-negotiation period. But he believes talk of identifying ‘red lines’ was premature – it is too early to be so definitive.
Nonetheless, work should be underway behind the scenes in Whitehall on the relative importance of different UK priorities – and he believes the economy must come out top. The Government’s apparent lack of interest in the economic consequences of Brexit was explicable, given the Leave campaign had focused on issues of migration and sovereignty. Fraser believes that economic considerations may be carrying more weight in private.
Parliament will have ‘some sort of vote’
Fraser is clear that the Government has a democratic responsibility to engage the public and Parliament during negotiations. Despite having experienced first-hand the frustration of having positions leaked during negotiations, he advocates complete transparency and the close involvement of Parliament.
Given the length of negotiations, and how incredibly important the outcome is, he believes Parliament will have ‘some sort of vote’ on the final deal. Those who assume responsibility for the Brexit process, Fraser says, will need hard-headed pragmatism to be successful – but he believes that they can count on the loyalty and professionalism of the Civil Service.
Timelines after pulling the Article 50 trigger
When Article 50 is triggered next year, it will kick-start the first set of formal negotiations with the EU. The two-year countdown will be underway, but French and German elections either side of the summer will mean that serious top-level engagement will go on hold – until the end of 2017.
In terms of timelines in Whitehall, Fraser believes that we can expect the UK to set out its aims next spring, after which the EU will formally begin internal discussions on how to structure negotiations and agree their position. The public line has been that these conversations will only begin once Article 50 is invoked, but Fraser feels it is highly likely that conversations are already underway.
Much of next year will be dominated by the French and German elections, but Fraser points out that during that time, officials from both the UK and EU will still be working on technical detail. This work is necessary preparation to underpin the ministerial-level conversations that will follow.
The future relationship is key
Although some overlap between the negotiations is inevitable, once the ‘terms of separation’ are agreed, the focus will turn to the UK’s future relationship with the EU.
Fraser warns of ‘incredibly difficult, tough and complex’ talks, with the EU seeking to dissuade others from leaving by making it ‘absolutely clear there is a price tag attached’ to departure. But he believes that the UK does have some strong cards in its hand.
The nature of our shared economic interests means neither side would benefit from an abrupt exit. Having been the most senior civil servant in the FCO, Fraser is uniquely placed to comment on the areas of EU policy that would diminish without UK involvement, namely foreign policy, defence and security. He described the UK as having ‘more international levers than any other comparable country’.
The key to playing these cards successfully will be avoiding any antagonistic and entrenched political positions. Negotiations should be played straight – anything the UK does to seek unfair advantage over the EU in negotiations will be met with reciprocal action.
He concluded the event by repeating the words former President of the European Council, Herman van Rompuy: ‘We can only take this incrementally, step-by- step, we are on a journey to an unknown location.’