Albert Weale applies elementary principle of bargaining theory to demonstrate that the Withdrawal Agreement and Political Declaration currently on the table are the best deal possible for the UK government given its own red lines and its starting-point.
The withdrawal agreement and declaration on a future relationship are regarded by both sides of the Brexit debate as a bad deal for the UK. For Brexiteers, it leaves the country as a rule-taking ‘vassal state’ on single market rules, requires payments into the EU budget during the transition period, and has no freedom to implement free trade agreements with other countries until the end of the back-stop. For Remainers it will lead to the UK being worse off than it would be in the EU or in a Norway type arrangement, quite apart from any damage to the UK’s reputation. The temptation is to put this down to Mrs May’s poor negotiating skills. However, given her initial red lines, the outcome is quite positive. The UK is outside the jurisdiction of the ECJ, it has its own immigration policy and has continued customs arrangements, the last of which is far from being an EU plot to keep the UK as a vassal state, but is instead a concession to UK cherry-picking.
Still, it is not good to be a rule-taker, whilst paying into the budget, and with so little protection for UK services. More importantly, it leaves the UK weak in negotiating the terms of the future arrangements given the vetoes that EU might exercise by way of leverage. So, how did a UK government get to this position? Some elementary principles of bargaining theory provide an answer.
As agreement is reached with the EU, Theresa May’s Brexit deal will come before parliament. In this contribution, Benjamin Martill, Dahrendorf Forum Post-Doctoral Fellow at LSE, breaks down the parliamentary arithmetic and assesses her options.
My Kingdom for a Deal
Theresa May has, at long last, reached agreement with the EU on the terms of Britain’s impending withdrawal from the Union on 29 March 2019. The deal is politically controversial and seems to have pleased no one, especially the hardline Brexiters. This is because it could see the UK remain within a single customs territory with the EU, precluding the need for a hard border on the island of Ireland. Northern Ireland would also remain in key elements of the single market for goods, for the same reason. This ‘backstop’ has proven to be the most contentious element of the Withdrawal Agreement, dragging out negotiations which were almost 80 percent complete at the beginning of 2018.
What is clear from recent political developments is that the UK is at a crossroads. According to Kirsty Hughes, whether a deal passes or not in the House of Commons in December depends now not least on whether enough Tory Brexiter MPs will vote against Theresa May’s Brexit deal, an irony considering this could lead to Brexit not happening at all. As time is running out, this second post discusses whether the deal can pass while the first one explained the deal itself and its dilemmas.
While many are predicting it cannot pass the Commons – and that certainly looks tough for now – the political dynamics of the coming weeks are not easily predicted. Theresa May could yet face a leadership challenge. But she is aiming still to head to Brussels for the EU summit on 25th November, sign off the deal and see if she can get it through parliament perhaps by the second week of December. And the EU will be clear that it’s this deal or nothing (although Tusk has helpfully said that the EU is best prepared for no Brexit at all). It’s also been suggested that, even if the deal is rejected, May might then ask the EU27 at the 13-14 December summit for some amendments to the deal and ask the Commons to vote again in January.
But this starts to look unlikely – a clear rejection of the deal by the Commons would open up a major, destabilising political crisis. Where the Brexit saga would go next is unclear – an election, a people’s vote including a ‘remain’ option (with an extension of Article 50), a renegotiation for a ‘soft’ Brexit, a national unity government?
What is clear from recent political developments is that the UK is at a crossroads. According to Kirsty Hughes, whether a deal passes or not in the House of Commons in December depends now not least on whether enough Tory Brexiter MPs will vote against Theresa May’s Brexit deal, an irony considering this could lead to Brexit not happening at all. As time is running out, this first post explains the deal itself and its dilemmas while the second one discusses whether the deal can pass.
Deal contained in the very long withdrawal agreement and the short (but to be lengthened) political declaration is a messy one. It covers – as the March draft did – the rights of citizens, the UK’s financial payments, transition – and now with clear governance proposals and a new variant of the backstop to ensure an open border in Ireland.
The transition period, when the UK stays in the EU’s single market and customs union – a powerless rule-taker – still ends in December 2020 but can be extended if the UK asks for it to be by July 2020. When it may end is left open for now in the draft text – “20xx”.
Doris cleaner to the chattering classes
A new UCL European Institute series of cartoons by Ros Asquith featuring Doris, a cleaning lady that witnesses the divides of a society shaken by Brexit. This series will be composed of a monthly cartoon shedding light on a particular issue around the British society and Brexit from July 2018 till the departure of the UK from the EU in March 2019.