LONDON – Theresa May on Thursday afternoon published the UK government’s plans for its future relationship with the European Union after Brexit.
The 98-page document calls for a relationship which is “broader in scope than any other that exists between the EU and a third country” and reflects “the EU’s deep history, close ties and unique starting point” with the UK.
To save you the hassle of reading 98 pages, here are the five key things you need to know about May’s new Brexit plan.
May wants to stay close to the single market
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Under May’s plan, the UK will cease to be a full member of the single market but will choose to effectively stay inside it for goods. This means the UK will continue to follow EU standards for the trade of goods after it has left the bloc. This is described as a “common rulebook” in the white paper. Goods account for around 20% of the national economy.
The UK government could in the future decide not to follow some EU rules. However, there would be harsh penalties for doing so, including reduced access to the single market, which would have costly consequences for UK businesses. This plan therefore effectively permanently ties Britain to EU rules.
Brexiteers don’t like this part of the plan because it means EU rules would continue in the UK despite it no longer being a member state. It would also make free trade deals with countries with different standards, like the USA, much less likely.
It is also doubtful whether the EU will agree to a Brexit deal which would give the UK privileged access to their markets without signing up to the same responsibilities as members. Last month, a senior EU official said this would be unacceptable as it would undermine the integrity of the single market.
For pro-EU MPs and City of London figures, the proposal doesn’t keep the UK close enough to the single market, as there is no mention of single market treatment for services. Services accounts for 80% of the UK economy.
She also wants the UK to collect EU tariffs
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May wants to form an unprecedented customs relationship with the EU in which the UK would collect EU tariffs for goods headed for the EU before they get there. This, the UK government believes, would go some way to preserving the open Irish border, as there would be no need for customs checks on the UK-EU border. Put simply, the EU would outsource some of its customs checks to the UK, meaning UK customs officials would have lots of extra work to do.
Again, it is doubtful whether the EU would agree to this.
As one person close to Cabinet discussions told BI last week: “The NCP [new customs partnership] poses the fundamental question to the EU of whether to allow a third country to collect their tax revenue.
“It would be like the Chancellor giving Iceland the power to collect tax revenue on our behalf. We’d have no way of ensuring it was enforced properly.”
There are also concerns back home about the deliverability of the model.
The model – described in the white paper as a”Facilitated Customs Arrangement” – is so complex that it probably will not be ready in time for the end of the proposed transition period in December 2020. This is partly because the technology needed to make the system work doesn’t currently exist.
The UK would stay in various EU agencies
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The prime minister wants the UK to continue participating in EU agencies covering aviation, medicines and chemicals. This comes amid fears that a clean break from agencies like the European Medicines Agency and European Aviation Safety Agency could have apocalyptic consequences, like planes being grounded and vital medicines harder to get hold of.
May has previously admitted that the UK will have to make financial contributions to the EU in order to stay in its agencies. Also, these agencies are policed by the European Court of Justice, meaning the UK will not be totally free from European judges after it has left the bloc.
EU immigration wouldn’t drop hugely
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The white paper states that the free movement of people – the right of EU citizens to travel, work and live freely across the bloc – will cease to apply to the UK after it has left.
However, it says the UK government wants to negotiate “reciprocal mobility arrangements,” suggesting that EU citizens could be given preferential treatment in a future immigration system.
May is under pressure to pursue a liberal post-Brexit immigration system amid staff shortages in the National Health Service and other industries.
The UK would not be free of European judges
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May has repeatedly claimed that Brexit will, among many other things, end the ECJ’s direct jurisdiction over the UK. However, under her plan, in disputes relating to the “common rulebook” of cross-border trading standards mentioned previously, UK judges would be obliged to follow the lead of the ECJ, as only EU judges can interpret EU law.
This particular detail has not gone down well with pro-Brexit MPs. Conservative MP Jacob Rees-Mogg said this proposal would subject the UK to the “greatest vassalage” seen in over 800 years.