The Government has finally published its proposal for a ‘backstop’ arrangement to avoid a hard border in Northern Ireland, to come into effect if no other solution to the problem can be found. The proposal would mean the entire UK continues to comply with EU rules on customs processes and tariffs, for a time-limited period.
But, as usual when it comes to Brexit, it isn't that simple.
There are three issues the UK has fudged about how the UK intends to avoid a hard border:
The paper explicitly only deals with customs processes, which are just one part of the checks that would be needed at the border. Regulations on goods, particularly agricultural products which make up around 40% of cross-border trade, are particularly stringent in the EU – and there will need to be some kind of solution on them to avoid border infrastructure. Today’s paper trails a subsequent paper on regulation – but there is no indication of when we can expect that or what it might say.
The UK needs to make a clear proposal as to how it intends to avoid regulatory checks at the border, and it needs to do so soon if it wants the backstop proposal to be agreed at the European Council at the end of the month.
The Prime Minister and David Davis were reported to have clashed over whether the customs proposal should be indefinite or time-limited. Brexiteers feared that an unlimited proposal would be Brexit in name only. It seems that the Brexit Secretary got his way: in a late addition to the paper, which was last edited minutes before it was published, paragraph 26 of the paper says that ‘[t]he UK is clear that the temporary customs arrangement, should it be needed, should be time-limited’.
However, it also says that the time-limit will only expire when ‘the future customs arrangement can be introduced’. It ‘expects’ that this will be by the end of 2021, but there is no guarantee of that – the head of HMRC has said that it will take five years for one of the new customs options to be fully implemented. So, the time-limit has no fixed end date, and no clarity on who will decide when (if ever) it is no longer needed. Once more, the UK is serving up fudge to keep the show on the road, rather than advance a firm negotiating position.
The focus in recent days has been on what the different wings of the Government think. It is sometimes easy to forget that the UK is actually negotiating with 27 other countries and the European Commission. Michel Barnier has cautiously welcomed today’s publication from the UK, but it is far from clear that the proposal will satisfy the EU.
The time-limit question will be a critical issue for the EU; the backstop is supposed to be an insurance policy, to be used if all other options fail, so the possibility of it running out will be unwelcome. It may be a sensible negotiating tactic for the UK to propose this, both to placate Brexiteers and to have something to concede when this is discussed with the EU, but we should not expect it to last long.
There is, though, a more fundamental question of whether the EU will accept the idea of the whole UK continuing to effectively remain part of the customs union. They were prepared to allow this for Northern Ireland, because of the unique circumstances there and the relative size of its economy. But keeping the whole UK inside the EU’s customs arrangements would be a different ball game. Member states might welcome it as it would keep trade flowing relatively freely. But the Commission, as guardians of the EU’s rules, may be more sceptical. It makes sense for the UK to ask for this, but there may be further concessions ahead if it is to achieve its objective.
It is important to remember that we are still only talking about agreeing the fallback solution. Neither side wants the backstop to actually become the future arrangement for Ireland.
The UK’s paper today says that the ‘future partnership framework’, due to be concluded alongside the Withdrawal Agreement in October 2018, will set out the detail of the future customs arrangements which will replace the backstop.
This seems unlikely: the EU has rejected both of the UK’s proposals for the future customs arrangements, and the future framework in October will probably be light on details, with negotiations on the future continuing for months, if not years, after the Withdrawal Agreement is concluded. Any future relationship will be judged against what it means for the Irish border, which means this question is not going away any time soon.