Analysis

Labour may need to make common cause with Rees-Mogg

by Hugo Dixon | 13.07.2018

It is not clear that pro-European Tories will vote against Theresa May’s castration Brexit. If so, the hardliners around Jacob Rees-Mogg, who are rightly up in arms about the UK being turned into an EU colony, may provide an alternative route to achieve the same goal.

The most desirable way of defeating the prime minister’s plans would be to form a coalition between all opposition parties and at least 10 pro-European Tory MPs. But, at least for the moment, many pro-Europeans seem inclined to rally behind May in her hour of need – even though it means signing up to a miserable proposal that would damage both our prosperity and our power.

The first test will come next week when both the Trade Bill and Taxation (Cross-Border Trade) Bill are due to come back to the House of Commons. Anna Soubry, who has been fighting valiantly against a destructive Brexit, has put forward an amendment to the Trade Bill calling for us stay in a customs union with the EU. (See NC1). If only a few fellow Tories support her, the rebellion will fail.

Rees-Mogg’s wrecking amendment

There is an alternative way of defeating the government. The opposition could leverage the Moggites’ fury over what May is planning. The Taxation Bill offers a specific opportunity because Rees-Mogg and Priti Patel have put forward a wrecking amendment to the prime minister’s customs proposal. (See NC36).

The government’s scheme – known as a Facilitated Customs Arrangement (FCA) – is riddled with flaws. The one Rees-Mogg is homing in on is that we would be required to collect tariffs on behalf of the EU while it wouldn’t have to collect tariffs on our behalf.

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The Moggites are right to be outraged. This grotesquely asymmetric proposal would mean the EU could pocket money that is rightfully ours on any goods that come to the UK via the rest of Europe.

What’s more, the whole arrangement would mean that countries in the rest of the world would have little incentive to cut trade deals with us. They could, after all, get backdoor access to our market via trade deals with the EU – without us having access to their markets in return.

Donald Trump has just spotted this flaw, saying the proposal would probably “kill” a UK/US trade deal and lead to America doing a deal with the EU instead.

Rees-Mogg’s amendment says we can’t collect tariffs on behalf of the EU unless it also collects tariffs on behalf of us. Although this proposal is fair, it would still wreck the FCA – because there is no way the EU would agree to collect tariffs on our behalf.

The FCA is a bureaucratic nightmare, as we would have to track goods and components that enter the UK, to make sure they don’t end up in the EU without paying the right duty. The EU might just about humour the prime minister and say she could tie our industry in knots so long as it can be satisfied there will be no fraud. But the chance that the other 27 countries would agree to tie themselves in knots as well is zero.

Rees-Mogg presumably hopes that, by wrecking the FCA, he will get the hardest of hard Brexits. But that’s not terribly likely because he has the support of only a small band of extremists. If the FCA is killed off, it’s much more likely Parliament will force the prime minister to stay in a customs union.

Labour’s two opportunities

This is what provides Labour with its first opportunity. It could support the Rees-Mogg amendment and so drive a horse and coaches through the government’s Brexit policy.

Some might consider this a pact with the devil. But given that Rees-Mogg’s proposal is a fair one and that Labour wants a customs union, such a tactic would be defensible.

If Labour still finds this too hard to stomach, it has a second opportunity to wreck May’s customs policy. It could wait for the amendment to be defeated and then hope the Moggites join it in voting down the unamended bill.

Whatever happens on the Taxation Bill could be a dry run for the much bigger battle, probably towards the end of the year, when and if the prime minister reaches a deal with the EU. At that point, the best option would be for the pro-European Tories to help sink it. But, if they are unwilling to, the opposition may have to rely on the Moggites. Next week is a good time to test the ground.

4 Responses to “Labour may need to make common cause with Rees-Mogg”

  • It’s the classic dilemma faced by those who are suicidal: how to make a clean job of it, and avoid the risk of ending up totally dependent and unable to express one’s wishes – which is even worse.

  • The point of the white paper is that it is a PROPOSAL. I.e., subject o negotiation and amendment. Over the last few weeks INFACTS seems to have changed sides somewhat ?? I voted to stay in the EU. That a small majority voted otherwise is largely due to ignorance (an AWFUL lot of people don’t know WHAT the EU actually is) and a deliberate misinformation campaign on both sides (to say nothing of the gutter press) and a desire to bloody DC’s nose. Well, he’s gone, and good riddance, but we’re left with this dreadful mess. Just think how life would be like if we’d voted to stay in. GO ON, THINK ABOUT IT. We’d be doing OK, just like we’ve done OK over the last 47 years. Instead of which, either way the negotiations go, we are screwed.

  • A very costly exercise that we and the EU are paying to demonstrate, once and for all, that the euro sceptics have been wrong during the past many decades. Our best place really is at the heart of the EU improving it. Rather than allowing the never ending destructive skirmishes carried out by the euro sceptics to take place. Indeed, various governments have used these attacks to further their own political agenda without consideration of the UK’s well being as a whole by choosing to do so.

    The monetary costs could be calculated (and will not be) but the costs to the well being of the population as a whole are incalculable and criminal.