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Analysis

‘Temporary’ customs union is May’s latest con

by Hugo Dixon | 06.05.2019

What on earth is a “temporary” customs union? Is it a longer transition? Or just the notorious backstop by another name? Or a new unicorn?

The prime minister plans to propose a “comprehensive but temporary” customs union with the EU lasting until the next election to get Jeremy Corbyn to support her Brexit deal, according to the Sunday Times. The idea seems to be to pacify her own MPs by saying the arrangement won’t necessarily last while winning over Labour by suggesting that it would be permanent if they win the election.

Forget for a moment that a permanent customs union is a thoroughly bad idea. Even if Corbyn falls for the prime minister’s temporary wheeze, it may not get through the House of Commons.

But there’s a more fundamental problem. If Theresa May is really proposing a “comprehensive” customs union lasting until the next election, she is living in fantasy land. The EU has got better things to do than negotiate yet another short-term deal with an unstable government.

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Longer transition?

But surely the other countries would be happy to give us a longer transition? They’ve already said we can stay in the customs union and single market – plus the EU’s other programmes – until the end of 2020. We can extend this for another two years if we pay a fee, likely to be around £13 billion for each year.

If this is what the prime minister means, she should say so. She should be honest not just about the financial cost. She should admit we would follow all the EU’s rules during this extended transition without a vote on them – making a mockery of the “take back control” slogan. And she should acknowledge that it would mean the continuation of free movement – which so many of her own supporters hate, despite it being beneficial for the country.

If this is what May means, there’s another problem. The EU won’t start negotiating a permanent arrangement until after the election – and will only do that if there’s a stable government with a realistic proposal. Even in the best scenario, it will take years to complete the talks – and the uncertainty that is paralysing the political system, sucking the life out of the economy and angering voters would go on and on. What’s more, unless we persuade the EU to extend the transition again – at yet more cost – the backstop will kick in.

Backstop by another name

Recall that the backstop is a bare bones customs union designed to keep the Irish land border open if all else fails. It has two main elements: the whole UK follows EU customs rules; and Northern Ireland also follows the EU’s rules on goods and agrifoods. Under the withdrawal agreement, we go into the backstop at the end of the transition unless we have agreed a trade deal by then.

So maybe what the prime minister means by a “temporary” customs union is merely the backstop by another name. Maybe she doesn’t even envisage a longer transition but thinks we’ll just go straight into the backstop at the end of next year. Maybe she doesn’t have a clue as she knows she won’t be prime minister by then anyway.

In any event, if May is trying to dress up the backstop as a temporary customs union, she should be honest about it. She should admit that this would not be “comprehensive” as there would still be regulatory checks between Great Britain and the EU. These would gum up our manufacturers’ supply chains. She should also acknowledge there would be regulatory checks between Great Britain and Northern Ireland – and that could undermine the unity of the UK.

If she’s just offering Labour the backstop by another name, it’s not much of an offer. It’s a con. Corbyn should just say “no”.

Correction: the first paragraph of the section “Longer transition?” was amended to make clear that the UK already has the right to ask for an extra two years rather than one.

Published and promoted by Hugo Dixon on behalf of Referendum Facts Ltd., Millbank Tower, 21-24 Millbank, London SW1P 4QP