12 Dec

Brexit – what’s next?

This article was first written by Luke Petherbridge, ABTA for Travel Law Today issue eight, which can be download at abta.com/travellawtoday

The 31 October deadline has come and gone, yet the UK remains a Member of the European Union. The country now cannot depart the EU without a deal before 31 January 2020. So what happens next?

The usual caveat applies; everything below relies on reason and logic winning out and that’s not a given in UK politics right now.

Brexit fatigue has certainly been heightened by a further delay. However, for weary business leaders and consumers, there does appear to be the promise of positive news when we examine the positions of the political parties heading into the first December election in nearly 100 years. For, whatever the result of the election, a no-deal outcome at the end of January 2020 seems a more remote possibility than was the case ahead of Halloween.

As the General Election campaign gets underway, the governing Conservative Party has a comfortable poll lead of around nine points according to the latest BBC ‘poll of polls’, which collates all available polling data. This would translate into a comfortable double-digit majority if borne out on polling day, although there are many factors at play to suggest it won’t be quite so simple.

Of course, should the current prime minister, Boris Johnson, emerge victorious, there is an existing deal ready to sign off, which has already received broad support from his MPs. Under that deal the UK would enter a standstill transition period until at least December 2020.

Meanwhile, the official opposition Labour Party has promised to renegotiate with the EU before holding a ‘confirmatory referendum’ between a so-called ‘credible leave’ option and remaining in the EU. This would likely require a further extension from the EU until July 2020. That position does carry the theoretical risk of a Member State veto, which would force us out in January, but it is difficult to see the EU wanting to interfere in the UK’s domestic politics in such a dramatic fashion in the direct aftermath of a national election.

If you consider the previous objection to an Article 50 extension from France’s President Macron, for example, it was predicated on the lack of a visible solution – a promise to hold a further referendum would provide clear evidence that the UK is moving towards an end point. And, the Liberal Democrat position is even more clear cut – revoke Article 50 and remain in the EU. Their leader, Jo Swinson, has adopted the simple slogan “make it stop” to appeal to people who just want the whole Brexit debate to disappear. It’s also difficult, given the positions above, to see how any coalition of these parties would not also result in a referendum with two possible outcomes, deal or remain.

Looking beyond the large UK-wide parties, the above conclusion would also appear to hold true for any coalition involving the pro-remain Scottish National Party, which is expected to increase its representation in Westminster. The big unknown factor is the Brexit Party, but the current chance of their candidates being elected in sufficient numbers to be a major force post-election remains minimal. The two viable remaining paths to a January no-deal would appear to be (1) a complete policy reversal from the prime minister, abandoning his deal – but there is no reason to see why this would happen and it would mean accepting the blame for whatever might follow or (2) the re-election of a Parliament with no stable majority at all, but in that scenario, MPs have previously moved to block no-deal where no agreed deal has been possible.

That’s the positive news for avoiding a no-deal Brexit, but it might only be that way for the short term. Perhaps the more concerning longer-term scenario is the risk of a no-deal in December 2020 at the end of the envisaged transition period. Under the current Withdrawal Agreement, we would have less than a year to negotiate our future trading relationship. Just looking at travel, the list of outstanding items is daunting. Everything from a new Air Service Agreement to reciprocal healthcare access for citizens remains unresolved and up for discussion. And, we’re only one sector. Is there adequate time to do the deal that is needed in the time given? The answer would clearly appear to be no.

Yet, the current position of the Conservative Party is to reject the available extension to transition, which the UK Government would need to activate in July 2020, and which would extend the standstill arrangement until the end of 2022. It can only be hoped that a comfortable majority would alter the prime minister’s attitude to this transition period – and bring about the room to manoeuvre to a more pragmatic position on the time required for future trade talks. So, all eyes could soon be on extending transition next July. If not, we could well be headed for another period of no-deal uncertainty at the end of next year.