No evidence of a better deal outside EU

by Jack Schickler | 02.03.2016

Foreign Secretary Philip Hammond today said he wants to “smoke out” Brexit campaigners, and get them to set out what the UK’s future relationship with Europe could be. Quite right, too. Brexiteers can’t say with any certainty what agreement will emerge if Britain leaves the EU. They can only imagine the kind of deal they would like to see.

On the other hand, we know for sure the deals other countries outside the Union have made. We have no need for guesswork.

Today the government published its views on the alternatives to EU membership. It sets out 3 broad models. First, the Norwegian option of European Economic Area membership. Second, bilateral agreements as pursued – to varying degrees – by Switzerland and Canada. Or, third, reverting to a relationship based on the rules of the World Trade Organisation (WTO).

The government examines the economic and security implications of each – noting that all require trade-offs. It concludes that “no existing model … comes close to providing the same balance of advantages and influence” that the UK has under the status quo of EU membership.

InFacts broadly agrees with the government’s analysis. The Norwegian option requires accepting the free movement of people, applying EU laws with no say in them, and paying about as much into the EU budget as we do now. The Switzerland option excludes one of its most important sectors, financial services – while Swiss attempts to limit free movement of people have met with a frosty response from the EU. The Canadian option of a free trade agreement means less access to the single market, higher tariffs, and would make Britain subject to the authority of a new court. Falling back on WTO rules would offer third-tier access, while doing precious little for the services which account for 78% of the British economy.

Work and Pensions Secretary Iain Duncan Smith has dismissed the government’s report as a “dodgy dossier”. He protests that the UK “won’t copy any other country’s deal”, but will have “a settlement on our own terms”. Fellow Cabinet minister Chris Grayling appears to agree.

They are almost certainly right. The other models are just that – models – and our deal would be different. But the real question is whether it would be better.

They cannot possibly be sure that it would be. Even if Brexiteers could agree on the best solution, the final deal would have to be thrashed out with European partners.

The arrangements of Switzerland, Norway and others will not determine the shape of a post-EU UK deal. But they are the best available evidence of the kind of trade-offs that have to be made in such negotiations.

That evidence shows that the fewer trade barriers you want, the more you have to accept other things Brexiteers don’t like – budget contributions, open borders, supranational courts and the like.

Edited by Victor Sebestyen