Theresa May’s flip-flops are coming thick and fast. The prime minister is expected to use her big speech on Europe next week to say we should stay in the single market and customs union in all but name during the so-called transitional period after we quit the EU and before we reach a new long-term deal with the club.
This would be just the latest in a string of climb-downs by the prime minister. Remember the dementia tax and the freeze on public-sector pay? Or, within the Brexit dossier, the red line about ending the European Court of Justice’s jurisdiction?
Drum beats to suggest that May is preparing for a u-turn on the need to change virtually nothing during the years immediately after we quit the EU are getting louder. The next round of negotiations with Brussels have been postponed by a week to let the prime minister make her speech, the contents of which seem to be leaking.
Philip Hammond, the chancellor, told a House of Lords committee yesterday that Britain will seek a Brexit transition deal that “looks a lot like the status quo”, maintaining single market and customs union membership in all but name. David Davis, the Brexit secretary, told the House of Commons last week that “we need to be as close as we are to our current arrangements” during the transition.
It is good that May is coming to terms with reality. She seems to accept that we won’t be able to negotiate a brand new trade deal in the little time we have left before the Article 50 clock stops ticking. She seems to recognise that, if we don’t reach a transitional deal, the economy will fall off a cliff. She may now have cottoned on to the fact that the only half-decent transitional arrangement we could agree is to stay in the single market and customs union – or something that amounts to virtually the same thing. Presumably, the prime minister has also realised that we won’t be able to maintain the status quo without following the EU’s rules, paying into its budget and keeping free movement of people.
While such a position would be realistic, it would also clearly be inferior to our current deal. We are now one of the EU’s most powerful rule-makers. During such a transitional deal, we would become a rule-taker. That would be neither good for national pride nor in the national interest.
Whatever deal is done on transition will merely pave the way for our future arrangements with the EU. The government thinks we should quit both the single market and customs union. But is it really going to be able to hold that line? After all, at the end of the transition, it will face a familiar dilemma: if it really downgrades trade with the EU, the economy will suffer; but if it wants to maintain the same benefits as we now have, it will have to become a rule-taker.
Labour is already coming to the conclusion that the priority is to save the economy. Perhaps May will eventually make a climbdown on that too. But, if it really makes sense to stay in the single market and customs union, it’s surely an even better idea never to quit the EU. Pro-Europeans need to keep making this point in the months ahead.