John Bruton

Opinions & Ideas

Category: European Union Page 2 of 6

DO TORY LEADERSHIP CONTENDERS UNDERSTAND WHY THERE IS AN IRISH BACKSTOP?

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On June 11, 2019

In BREXIT, European Union, Ireland, Northern Ireland

The Backstop is not just about the border. It is not a technical matter. It is not just about what happens at 200 crossing points.

It is about the people of Northern Ireland, and giving all of them (not just a majority) the freedom to be who they are, and a sense of belonging.

But the present debate in the UK Conservative Party about replacing the backstop, seems to assume that it is all about technical fixes and invisible border posts , and that some yet to be discovered combination of IT and lasers would remove the need for physical customs posts, and that would then solve the entire problem. That is a mistake.

The backstop is about far more than this.  It is a recognition of the fact that, in Northern Ireland there is a population some of whom feet they have exclusively British identity and allegiance, some of whom feel they have an exclusively Irish identity and allegiance, and some of whom combine these allegiances comfortably enough.

The backstop is a recognition of this fundamental divide, which has led to so much suffering in the past, and an attempt to sustain the arrangements that ended that suffering.

The Belfast Agreement of 1998 transcended these divisions through provisions for intense North/ South and East/West cooperation, that would allow all three groups, described above, to feel fully at home in Northern Ireland under any present, or future , constitutional arrangements.

This was easy to envisage as long as both parts of Ireland remained in the EU, because EU rules facilitated and underpinned free and easy cooperation both North/South and East/West.

In such a context, territorial “sovereignty” became less of an issue, because it was overlaid by structures of free cooperation enshrined in EU law.

Brexit changes all that in a radical way. It brings territorial sovereignty back into the centre of stage in a way that threatens the Belfast Agreement settlement in a deeply fundamental way. I believe that Theresa May came to understand this, and that that explains her acceptance of the backstop.

Most of those contending to take her place in the Conservative Party leadership do not seem to do so.

In the agreement of March 2019, the EU side has given the UK very strong assurance of its good faith in seeking to find an alternative to the backstop.

But that will only work if the UK side really understand why the backstop was put there in the first place.

I do not believe that the contenders for Conservative Party leadership have taken this on board.

GIVING THE PEOPLE A DIRECT SAY IN WHO IS PRESIDENT OF THE EUROPEAN COMMISSION

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On June 3, 2019

In European Commission, European Elections, European Union

Who will be the next President of the European Commission?

This is a decision that could set the European Council of heads of government on a collision course with the recently elected European Parliament and set France on a collision course with Germany. The present system is flawed in that it only gives voters an indirect, rather than a direct, say in who is Commission President, and is not truly representative in that it rewards only the biggest party.

Article 17 of the European Union Treaty says

“Taking account of the elections to the European Parliament, and after having held the appropriate consultations, the European Council shall propose to the Parliament a candidate for President of the Commission”.

It goes on to say that the nominee must then obtain a majority in the European Parliament, and if he or she does not, the European Council must then, within a month, propose a new name.

In 2014, and again in the recent European Parliament elections, the Parliament decided to go further.

It endorsed a process whereby the major parties would nominate a “lead candidate”, who would then be supported as President of the Commission.

In a sense this preempted to role of the European Council in picking the nominee.

In 2014 Jean Claude Juncker was the nominee of the EPP and, when the EPP emerged as the biggest single party (219 out of 751), he was nominated. Only Hungary and the UK opposed him in the European Council. He was then elected by a majority vote in the Parliament.

This “lead candidate” system was devised, so as to allow each voter to have a say, through their choice of party in the European Election, in who would be President of the Commission. It was a form of indirect democracy.

For the 2019 election the same process was followed.

The EPP proposed Manfred Weber as their nominee for President of the Commission.

The Social Democrats nominated Frans Timmermans .

The Greens nominated Ska Keller.

The Liberals, who do not like the lead candidate process, group put forward a “team” of candidates including Guy Verhofstadt and Margarete Verstager.

Weber won last week, in the sense that his group has most MEPs (180). So he has a good case to be the nominee. But 180 is even further from an overall majority of the 751 member Parliament  than Jean Claude Juncker was with 219 MEPs in 2014.

A system which says the party with the most MEPs shall have its nominee as President of the Commission  has the deficiencies of the British straight vote, it is a “winner take all” electoral system.

Second preferences do not count.  All one needs to be is the biggest party, to claim the job.  Like the British electoral system that is polarizing by its nature.

Some argue that the lead candidate system also upsets the balance of power between the Parliament and European Council, in that it purports to tie the hands of the European Council on who it may nominate, and also it politicizes the Commission unduly.

Under the Treaty, the Council must “take account” of the results of the results of the European Election in choosing its nominee, but the lead candidate system in not in the Treaty. It does not oblige the Council  to pick the nominee of the biggest party.

On the other hand, credibility will be at stake if the Council now rejects Manfred Weber.

The Council cannot simply ignore the fact that the election was fought on the basis of the lead candidate system, and many voters were genuinely led to believe that, in voting for a particular party, they were also voting for that party’s nominee for President of the Commission.  

Presidential debates took place between the lead candidates, on the assumption that one of them would become President of the Commission.

To replace that open, if flawed, system with a  backroom deal to put forward someone whose name was not before the electorate  at all would be a hard sell, no matter how well qualified the new nominee might be.

And that alternative nominee would still have to win a majority in Parliament, to be elected. The outgoing European Parliament, in a formal resolution, said the Parliament would be “ready to reject” a nominee who had not been a lead candidate.

So the European Council would be taking a big risk if, at this stage, it decides to reject the lead candidate system.

There is a wider argument.

Despite the improved voter turnout, many EU citizens still feel EU decision-making is remote.  

The European Council would need to come up with something much better if it decides to go against the lead candidate method of selecting the Commission President.

In 2001, the EU heads of government asked the Convention on the Future of Europe (of which I was a member), to look at new ways to create a “Europe-wide democratic public opinion” when it drew up a new EU Treaty.

The heads of government specifically asked the Convention to consider the direct election of Europe’s Commission President, not by the Parliament,  but by the voters of Europe themselves.

They also asked  the Convention to consider whether some MEPs should be elected in Europe-wide, rather than in national, constituencies.  This would have given voters an opportunity to vote on European policies, rather than just on the national ones, that tend to predominate in European elections at present.

I regret to say neither of these proposals got serious consideration by the Convention.

I argued strongly there for the direct election by the people of the President of the Commission, on the same day, but on a different ballot paper, to MEPs.  Separating the two votes would preserve the vital separation of powers between Parliament, Commission ,and the Council

The proposal failed to get support because many members of the Convention felt that a  President of the Commission, directly elected by the people, would be politically too powerful, even if his or her legal prerogatives were no more than those of the existing Commission President.

The other idea,  that of electing some of the MEPs on a Europe wide list did not get support either, chiefly because some of the existing MEP seats  would have had to be given over to the Europe wide list, and some existing MEPs might have lost out.

The looming impasse over the Commission Presidency shows we need to devise a better system.

I believe the best solution would be to have the President of the Commission directly elected by the people of the EU, under a proportional representation system with a single transferable vote (PR.STV). It is a simple system, once you get the hang of it.

It is used in by elections in Ireland. It was considered as the replacement for the present UK system, in a referendum in the UK during the Tory/ Lib Dem coalition, but unfortunately rejected. If it had been accepted Brexit might never have happened.

Under PR.STV, people’s second and third preferences are taken into account, if their first choice does not win. The importance of second preferences encourages candidates to appeal to as broad an electorate as possible. This reduces the sort of destructive polarization we now see in UK and US politics.

But the system involves several counts after the elimination of lower candidates. To introduce PR.STV for EU Presidential Elections would need the introduction of a standardized  electronic system for the casting and counting of votes all over the EU, which would require a substantial investment.

But I believe it would be the best, and fairest, way forward for European democracy.

WHY THE EU HAS DIFFICULTIES WITH THE CHEQUERS PROPOSALS

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On September 29, 2018

In BREXIT, European Union, Ireland

The Chequers proposals of the UK Government were a genuine, if belated, attempt to reconcile the expectations of the British people with EU realities.

But they ran into difficulty for the following reasons. If Chequers remained an opening negotiating position, it might have started a useful conversation.

  1. But , under the pressure of domestic UK politics,  Prime Minister May soon made it a “red line” position, and thus no longer negotiable.
  2. From an EU perspective, Chequers was problematic because it would have meant the EU giving up control of its trade borders, and subcontracting that to a non member, the UK. It would have provided for a common rule book for the quality of goods circulating, via the UK, into the EU Single Market, but the UK Parliament would still have retained the option of not passing some of the relevant legislation to give effect to this rulebook. Furthermore, it would not have been bound to accept the ECJ’s interpretation of what the common rules meant.
  3. It would have meant the UK opting into some bits of the EU Single Market, but not all, and that precedent would have created immediate demands for exceptions from other EU members and also from Switzerland and Norway.

It does not require much political imagination to see that these aspects of the UK proposal were going to be a hard sell in the parliaments of some of the 27 countries. And if just one of them said NO to an eventual EU/UK trade deal, there would be no deal. Each has a veto.

GOVE THEN UNDERMINED THE CHEQUERS LINE

To make matters worse, a collectively responsible member of the UK Cabinet, Michael Gove  suggested that the UK might agree a Withdrawal Treaty on the basis of the Chequers approach, but later, once out to the EU, abandon it, and do whatever it liked. This would put Mrs May in a position of negotiating with the EU in bad faith. It also raised doubts that, even if the EU side accepted Chequers, the UK government could not carry it through.

DOUBTS  RAISED ABOUT THE IRISH BORDER COMITTMENTS

Gove’s intervention also cast doubt the genuineness of commitments the UK had given on the Irish border.

In a Joint Report of 8 December 2017, the UK agreed to respect Ireland’s place in the EU and all that entailed, and that there would be no hard border in Ireland. This was to apply

“in all circumstances, irrespective of any future agreement between the EU and the UK”.

When the UK declined to translate this commitment into legal language for the Withdrawal Treaty, the EU side began to wonder if the UK wanted to delay dealing with Irish border problem until the last minute, hoping to table a proposal on a “take it or leave it” basis, and that the EU would not then jeopardize the whole deal over a place as small as Ireland!

Unsurprisingly, this shifting UK approach was not accepted by the UK’s EU partners, when they met in Salzburg.

The UK should not have felt “humiliated” by this. The EU is a complex institution, with 27 different countries.

ANY DEAL WILL HAVE TO APPROVED BY 27 PARLIAMENTS

As I said the parliaments of all 27 of them will have to ratify any eventual trade deal the UK. Let us not forget that EU found it hard to ratify its trade deals with Canada and Ukraine, because of objections in Wallonia and Netherlands respectively.

But before starting to negotiate a trade deal, the UK must first agree the terms of its withdrawal from the EU.

The Irish border question is central to this.

THE HARDER THE BREXIT, THE HARDER THE BORDER

The harder the UK Brexit, the harder will be the resolution of Irish border problem.

The further the UK negotiating demand goes from continued membership of the EU, the harder it will be for it to fulfill the commitments it has given on the Irish border.

If the UK decided to leave the EU, but to stay in the Customs Union, the Irish border questions would have been minimized.  But the UK has decided to reject that, because it hopes to be able to make better trade deals with non EU countries than the one it already enjoys as an EU member.

The UK has also rejected joining the European Economic Area (the Norway option), which would also have minimized the Irish border problems, because it would mean continued free movement of people from the EU into the UK .

In each decision, Ireland was given a lower priority than the supposed benefits of hoped for trade agreement with faraway places, and of curbing EU immigration.  This was short sighted.

Future trade agreements that might be made with countries outside the EU are neither as immediate, nor as beneficial to the UK, as maintaining peace and good relations in the island of Ireland, or as  the 70 or more trade agreement the UK already enjoys as an EU member, which it will lose when it leaves.

EU immigration to the UK, if it ever was a problem, is a purely temporary and finite one.

Already the economies of central European EU countries are picking up, and, as time goes by, there will be fewer and fewer people from those countries wanting to emigrate to the UK to find work.  These countries have low birth rates and ageing populations, so there is a diminishing pool of potential emigrants.

Again, I believe that solving this, largely imaginary, EU immigration “problem” is less important to the UK, in the long run, than peace and good relations in and with Ireland .

If, as is now suggested, the UK moves away from Chequers, and looks instead for a Canada style deal with the EU, the Irish border problem will become even worse. Mrs May has recognized this and this is why she rejects a Canada style deal..

A Canada style deal would mean the collection of heavy tariffs on food products, either on the Irish Sea, or on the Irish border. Collecting them on the 200 mile long land border would be physically impracticable, so the only option would be to do it on the Irish Sea.

Either way, the all Ireland economy, to which the UK committed itself in the Joint Report, would be irrevocably damaged. The economic foundation of the Belfast Agreement would be destroyed.

CONSERVING WHAT WE HAVE SHOULD BE THE GOAL OF A CONSERVATIVE PARTY

It is time for the Conservative Party to live up to its name, to be truly conservative, and conserve the peace we have so successfully built on the twin foundations of the Belfast Agreement and the EU Treaties, to which the UK committed itself in 1998 in the case of the Belfast Agreement,  and in 1973 in the case of the EU Treaties.

CAN BREXIT TAKE PLACE WITHOUT EITHER MAJOR TRADE DISRUPTION, OR SERIOUS DILUTION OF THE EU LEGAL ORDER?

By

On August 12, 2018

In BREXIT, Europe, Northern Ireland, UK

Brexit is a British decision.

It means that Britain is seeking to withdraw from a contract it made with the other EU members, on the basis of which those countries opened their markets to British business, in a way it was not opened to other countries. That was the deal.

In business, if one unilaterally withdraws from a contract, one does not normally expect to continue to enjoy all the benefits of the contract, afterwards.  One expects to have to make good some of the losses incurred by the other party.

But that is not how British public opinion sees Brexit. It IS how it is seen by the 27 partners of the UK in the EU.

This difference in perspective is at the root of the difficulties in the present negotiation.

The EU has developed, and maintained, an integrated Single Market for business because it has a single unified system for making, interpreting and enforcing a single set of rules.

The Single Market is deepening all the time and new fields of business are being made the subject of common rules, thereby opening new markets. This will not stop when the UK leaves.

Common rules are what keeps the EU together.

They derive from the EU Treaties, which is like a written constitution. It is difficult to amend. The UK, in contrast, has no written constitution, and there is no similar constraint on the UK Parliament.

So UK often looks at problems purely politically, while the EU has first to look at them legally. This causes misunderstandings. UK Ministers sometimes think that a political understanding with France and Germany will be enough to overcome its problems with the Commission, but that is not the way the EU works. France and Germany, and the Commission, are all subject to a common set of rules. This rule based system protects smaller countries and has been the secret of the EU’s success.

The recent Chequers decision by the UK Cabinet says the UK will keep to the  common EU rules for goods, but goes on to say that the

“UK Parliament would still have a lock on incorporating these rules in the UK legal order by not passing the relevant legislation”.

This is giving with one hand, and taking away with the other.

So, even if the UK and EU standards were the same at the outset, they could diverge substantially, depending on the vagaries of British politics. Ultimately the UK Parliament can do what it likes.

The UK will not be part of the EU legal order. This builds uncertainty into the proposed arrangement, and is bad for business.

This let out clause means that border controls might not be there at the outset, but might have to be reintroduced.

This is a critical issue for Ireland, where the reintroduction of border controls on the 300 mile boundary would be both provocative and impractical.

That is why the EU wants the Northern Ireland issue agreed before the UK leaves the EU.

The UK wants to take back control, but EU needs to have control too.  This point is not always understood in London.

The EU is 27 countries, and all their Parliaments will have accepted any eventual trade deal with the UK. This makes the sort of” flexibility”, the UK says it would like, difficult to obtain. Getting unanimous agreement of all EU Parliaments to a future EU trade deal with the UK will not be easy.

That was illustrated by the difficulties in ratifying recent Agreements with Ukraine and Canada, when extraneous domestic issues were used in Belgium and the Netherlands to delay ratification.

If the Commission wants a deal with the UK that will pass in all 27 Parliaments, it will have to exercise great care.

Patience will be required. Sound bites will not always be a help.

But before we even get down to detail on trade, there will have to be a Withdrawal Agreement.

80% of the text of the Withdrawal Agreement is already agreed, but 20% remains to be settled. Among the issues that are not settled is the

“backstop” to prevent a hard border in Ireland.

Here the EU has put forward the proposal that

“Northern Ireland remains in a common regulatory area for goods and customs with the rest of the EU”.

It has said it is ready to improve the text of this proposal, if the UK has suggestions to make. But such suggestions need to be within the parameters of what the EU has proposed.

This is difficult for the UK for various technical and political reasons, not least because England and Wales, but not Northern Ireland, voted in the Referendum to leave the EU’s common regulatory area.

Opinion on this in the UK is changing, but only very slowly.

The implications of a hard Brexit are only now being contemplated by most of the people who voted Leave in 2016.

In 2016, these people saw Brexit as an emotional assertion of national identity, rather than as a concrete proposal that would change their lives and livelihoods irrevocably.

I believe UK public opinion needs more time to consider if Brexit is really the best way to express their national identity, and more time to fix some of the inequities in British society that prompted people to vote Leave in 2016.

That why I have argued, in an earlier column in this paper, that the period of negotiation under Article 50 should be extended.

This could happen if the UK asked for it, but asking for it would require both immense courage on the part of the UK government, and a constructive response from the UK opposition.

It is hard to see evidence of either yet, but they could emerge if there is a crisis.

 

 

 

IMMIGRATION FROM AFRICA IS INEVITABLE….

By

On July 3, 2018

In European Union, Immigrants

EUROPE’S CHOICE IS WHETHER THIS IS TO BE PLANNED AND LEGAL, OR ILLEGAL AND DISORDERLY.

It is not immigration, but the political exploitation of immigration, that threatens border free movement within the EU.

Closing down legal migration routes has led to the opening up of illegal routes.

In 2010, 130,000 first time visas were issued to citizens of African countries by EU countries. By 2016, only a mere 30,000 visas were issued.

So denial of a legal immigration route is one contributor to illegal immigration.

African agriculture suffers disproportionately from climate change, but the human contribution to climate change comes disproportionately from the Northern Hemisphere, including from Europe.

Public opinion in some European countries is getting into a panic about immigration from outside Europe, yet these very countries are often the ones that have the least immigration.

A survey of public opinion, in 2016, found that the most negative opinions about immigration were to be found in Hungary, Slovakia, Latvia, Estonia and Romania (all countries with little enough non EU immigration).

The most welcoming attitude to immigration, at that time, was to be found in Sweden, Germany and the Netherlands (who all already have substantial numbers of non EU immigrants).

European countries have a legal obligation to provide a refuge for people who are fleeing in fear of their lives from wars. Europe has provided some shelter for refugees, but Turkey has 3 million refugees in its borders, Lebanon 1 million, and Uganda 1 million. No EU country is shouldering that sort of burden.

Europeans need to look at immigration in a different way.

Because we have decided, over the past  40 or more years, to have fewer children, Europeans will need immigration in future to maintain a proper balance between numbers at work, and numbers in retirement, unless those in retirement are to live a desolate old age thirty years from now.

In a few years time, people of working age will be in short supply.

Globally, the ratio of working age to retired, will fall from 8 to 1 today, to 4 to 1 by 2050. By 2050, the global population aged 65 or over will increase from 600 million to 2.1 billion.

This will create a huge funding crisis for governments, who will not be collecting enough tax from the diminished number of people of working and taxpaying age, to meet the promises it has made, of pensions and health care, to the increasing number who have already retired and no longer earners and taxpayers.

Opposition is principle to the arrival of young immigrants from Africa is short sighted.

This is because the working age population of most EU countries is set to decline, while its post retirement population is set to increase rapidly. Without immigration of people of working age, Europe’s diminished working age population, will imply relatively poorer health care and pensions for its ever growing retired population.

Africa has an abundant supply of what will soon be one of the world’s scarcest resources, young people.

Europe has a birth rate of 1.63 children per family. Iran and China have similarly low birth rates and the US rate is only slightly higher.

In contrast, the birth rate in Nigeria is 5.42, in Mali 5.92 and Niger 7.15.

Nigeria’s population has risen from 45 million, when it became independent in 1960, to 187 million today. By 2050 Nigeria’s population could reach 410 million. The present Nigerian economy is just not capable of finding employment for all these people.

The EU needs to work on a policy that encourages orderly and well prepared immigration from Africa, accompanied by well considered plans to integrate the immigrants into European society.

As much as possible of the preparation for European living should be done before would be emigrants leave their home countries. If Europe opens up legal routes for immigration, illegal routes will become less attractive.

Europe must develop an investment partnership with Africa.

As the European Council said last week;

“  We need to take the extent and the equality of our cooperation with Africa to a new level. This will not only require increased development funding but also steps towards creating a new framework enabling a substantial increase of private investment from both Africans and Europeans. Particular focus should be laid on education, health, infrastructure, innovation, good governance and women’s empowerment.”

 

Bruton calls for Brexit negotiating extension

By

On January 29, 2018

In BREXIT, European Union

John Bruton, Speaking to RTÉ’s Morning Ireland today.

Former taoiseach John Bruton has called for the two-year Brexit negotiating period to be extended.

Mr Bruton, who is also a former EU Ambassador to the United States, said the time limit is too short and any agreement reached will have to be ratified by the UK and EU parliaments, which also takes a lot of time.

Speaking to RTÉ’s Morning Ireland, Mr Bruton said that pressure for negotiations is too great and that mistakes are inevitably made, when insufficient time is given to negotiations.

Mr Bruton added that the time pressure is adding to a “fevered atmosphere” in British politics, with just over a year left before the negotiating period ends in March 2019.

He warned that Ireland would suffer as much as the UK, if the right deal was not reached.

Mr Bruton said there is a provision for the extension of the two-year negotiating period in Article 50.

He said that there are some downsides to the idea of extending the period and it would have to be reached unanimously.

However, he said the possibility of extending the period would allow for more rational discussion and a better outcome.

 

 

TWO YEAR PERIOD FOR NEGOTIATING BREXIT CAN, AND SHOULD, BE EXTENDED

By

On January 29, 2018

In BREXIT, European Union

I am delighted to be invited to speak at this important launch.  I congratulate Skoda on the recent rapid growth in sales in the Irish market.

I would like to talk this morning about Brexit.

I believe that Brexit will do disproportionate damage to the motor industry, which is one of Europe’s premier industries. It depends for its efficiency on complex supply chains, and these will be disrupted if the UK Government persists with its intention to leave the EU Customs Union and Single Market.

The risk of the UK simply crashing out of the EU remains high. The fact that Mrs May has had to postpone her planned speech on Brexit, points in that direction.  So does her slap down of Philip Hammond for saying that the changes in the EU/UK trade relationship would be “modest”. That slap down is hardly consistent with her promises in regard to the Irish border, which still have to be converted into Treaty language.

The gap between popular expectations and practical possibilities remains dangerously wide.

The two year time limit to conclude the negotiation of the terms for UK withdrawal from the EU is, as we are slowly learning, far too short.

The implications of UK withdrawal have not, even yet, been fully discovered by the negotiators on either side. New complications and hypotheses are emerging every day. These arise because we are only now digging down into 40 years worth of trade deals, memberships, and understandings, which the UK can only be part of, so long as it is in the EU.

It would be in the interest of Ireland if the UK were to decides either not to leave the EU at all, or, failing that, decides to rejoin the EU, on terms acceptable to Ireland.

How might this happen? This is the question I am attempting to answer in a paper to be published today by the Institute of International and European Affairs.

The UK hopes to leave the EU on 29 March 2019 but to continue to have access to the EU market for a two year Transition Period, ending on 29 March 2021.This date was presumably chosen because it is before the scheduled date of the UK General Election.

I believe this Transition Period approach is a mistake. I believe it would be simpler and wiser for the UK and the EU to agree to extend the period for negotiation under Article 50 by two or more additional years. This can be done by unanimous agreement.

DISADVANTAGES OF THE PRESENT” TRANSITION PERIOD” APPROACH

At the moment, the UK is seeking a two year transition period, after March 2019, during which, having left the EU as a member,  it would still enjoy the benefits of membership of the EU Single Market, and Customs Union. Some in the European Parliament have said the longest Transition the UK might be granted is 3 years.

If this is conceded, the U K, for the duration of the Transition, would not then have any say in the making, and in the interpretation of the rules of the Single Market and Customs Union, with which it would have to comply. It would still be subject to ECJ jurisdiction, and would still be contributing to the EU budget, on the same basis as if it was a member.

The UK Prime Minister calls this proposed transition period an” implementation” period.

Businesses in the UK and in the EU, and particularly Irish businesses trading with the UK, would presumably be expected to be implementing changes in their business practice to accommodate themselves to the sort of arrangements that would apply, in March 2021, when the UK had actually left both the Single Market and Customs Union, as Mrs May desires.

The difficulty will be that no one would know for sure what to prepare for.

The Transition would be more of a Postponement than a Transition!

This is because the  EU and the UK could only start substantive negotiations of the terms of a future UK/EU trade deal at the beginning of transition period, because the UK must first become a non member of the EU, before it can negotiate a trade deal with the EU.

On the other hand, as a non member and during the Transition Period, the UK would also have to negotiate replacements for the hundreds of  Trade and other Agreements it has with third countries as an EU member, which would cease once the UK had left the EU, on 29 March 2019.

Negotiating the terms of a Transition Period may prove to be very difficult, almost as difficult as negotiating a final agreement. Perhaps more, because there is no precedent to follow.

Of course, the political outlines of a  possible trade arrangement with the UK might have with the EU would be referred to in the “Framework for a future relationship” that, under Article 50, should accompany the Withdrawal Treaty.

The Withdrawal Treaty itself, and presumably the Framework, can be agreed by a qualified majority in the European Council.

But a future trade deal with the UK would face more difficulty. Depending on its content, and whenever it is eventually finalised, it  will  almost certainly require the  unanimous agreement.

If it covered services, many of which are regulated at national as well as EU level and which the UK wants included, it would have to get ratification from all the national parliaments.

So any outline of the trade deal, promised in the Framework accompanying the Withdrawal Treaty, might not survive the substantive negotiation that would take place after the UK had already left the EU

The Framework to be full of good intentions, but not full of the sort of bankable legal commitments that businesses will need to make investment decisions.

So two years may be too short a Transition period for business.

It will also be too short for trade negotiators, who say that a deal as complex, as the one the UK is seeking, would probably take 6 years to finalise, not just 2.

But, politically, a two year Transition, may be as long as the UK can live with, because its government is in such a political rush to leave.

By the time of the next election, the Conservative Party will not be comfortable ,if the UK is still in “transition”, implementing EU laws, contributing to the EU budget, and under the jurisdiction of the ECJ.  So it may be willing to pay a high price to finalise a Framework deal and end the Transition within the two years.

On the other hand, the likelihood is that, in those negotiating circumstances, the deal will be a “bad one” for the UK. But rejecting that “bad” deal will  not be attractive either because without a deal, the UK will be out of the EU, and will only be able to trade with the EU on “WTO terms”, which would be really bad for the UK, and appalling for Ireland.

All of this will be happening on the eve of the UK’s 2022 General Election.

In these circumstance the UK government might be tempted to look for an extension of the two years  Transiion and leave it to a post General election government to take the blame for an unsatisfactory Trade Agreement.

I believe one such time limited prolongation of the Transition Period, if requested by the UK, would be granted by the EU 27. But that would be it.

An indefinite prolongation, or a series of prolongations, would not be offered.

There is so much uncertainty surrounding the content and timeline of a UK/EU Trade deal that the Transition Period will not provide a reliable basis for planning by business.

All the same, the longer is the Transition, the better it will be for Irish business.

But a long Transition will be exceptionally difficult to sell in the UK.

It would offend against the principle of democratic representation. The UK would have to implement and abide by EU regulations, in the making of which it would have had no part. It would have no representation in the European Parliament,  Council or Commission. Any financial contribution it might make during the Transition would be represented by some as “taxation without representation”.

So, I conclude that, as the UK explores the difficulties of its proposed Transition or Implementation Period, it may find itself forced to look at other options.

The only other option on offer is an extension of time under Article 50 (3)

EXTENDING THE TWO YEARS AS PROVIDED FOR IN ARTICLE 50

Article 50 (3) of the Treaties, under which UK withdrawal is being negotiated, says a country that has applied to withdraw from the EU and given notice of intention to do so under Article 50 (2) shall cease automatically to be a  member

“ two years after the notification referred to in paragraph (2), unless the European Council, in agreement with the member states concerned, unanimously decides to extend that period”.

Extending the two year period is a matter for the member states. There is no provision requiring the consent of the European Parliament to such an extension of the two years.

At the moment, there is no official sign that either the UK, or the EU 27, would contemplate using such an extension, or even talking about it.

It is too early. To do so would signal weakness, and would be a poor negotiating tactic.

But the provision for an extension of the two years was put there for a practical reason.

Even with the best will in the world, trade negotiations can take longer that all sides want.

There can be unexpected technical and legal difficulties.

General Elections and government formation delay can prevent decisions from being taken. Look at the example of Germany at the moment.

Rigid time limits can also be exploited by forces that have another agenda, and simply want to maximise chaos.

Politicians can even change their minds, but need more time, than is provided with in the two year limit, to adjust the expectations of their supporters.

Time limits create a fevered atmosphere in which rational calculation becomes more difficult.

Time will have to allowed, at the end of the  two year period, for ratification of the Withdrawal Agreement, and of the Framework for Future Relations by both the British and European Parliaments, and both may look for time for debate and deliberation on the merits of rejecting, or accepting, the proposed Treaty

. Neither Parliament may wish to be confronted with a proposition, which says “take it or leave it, and do so now”.

Allowing time for Parliamentary ratification , on its own, might necessitate an extension of the two years.

An extension of the two year period, under Article 50 (3) would be different, in its effect ,from an extension of the Transition period.

Under Article 50 (3), the UK would continue, for the duration of the extension, to be a full voting member of the EU, except on issues to do with Brexit.

It would still be a member of the ECJ and a British Judge would continue to sit there.

The UK member of the Commission would continue his important work in that capacity.

The UK MEPs would continue to sit in the European Parliament, although from 2019 there would be different MEPs from some of the constituencies.

The UK would continue to be bound by EU law, but that will also be case during a Transition. But in the Article 50(3) scenario, the UK would enjoy democratic representation.

In these senses, an extension under Article 50 (3) would be a better deal for the UK than a Transition Period.

But the Referendum decision to leave the EU would not yet have been implemented. It would still be under negotiation.

An extension of time under Article 50(3) offers a greater degree of certainty to business. The UK would definitely retain all the obligations and advantages of membership for the duration of the extension.

Article 50 (3) offers no guidance on, and does not limit, the period of an extension that could be granted. Nor does it place a limit on the number of extensions that might be granted.

Given that every EU state, and the UK itself, would have to agree, the likelihood is that the initial period of any extension could be quite short.

But if, during that extension, negotiations were going forward in a good and constructive spirit, further extensions could become possible

Under the Article 50 (3) approach, the UK would still be a member of the EU.

Thus, while it could agree a framework for its future relationship with the EU and this could cover trade matters, the UK could not negotiate and finalise a trade deal with the EU or anybody else.

That would be a big negative from the point of view of those in Britain who believe there are attractive trade deals waiting to be concluded.

But, on the other hand, the UK would continue to benefit from existing EU trade agreements, and the extra time would allow it to put much greater flesh  and detail into the Framework for Future Relations with the EU, than will be possible in the time between now and March 2019.

I believe the two year time limits has created a fevered atmosphere in the negotiations. It  has politicised them in a way that makes rational calculation of mutual interest more difficult.

An early agreement to a substantial extension under Article 50 (3) would remove this problem, and would give the negotiators more time and space.

I have the sense that some in the UK are open to this possibility, but there is little appetite for it in Brussels.

If the EU side were unilaterally to offer an extension of the time period, under Article 50 (3), that went beyond the time of the UK General Election, it would thereby place a heavier responsibility for a bad negotiating outcome on the current UK government.

The UK government might want to reject such an offer, but it might not be able to persuade the UK Parliament to agree.

This would not be easily done.

There is a feeling in some continental EU countries that the UK has already taken up too much of the EU’s time. For example, the David Cameron’s decision to prevent the Compact for the Fiscal governance of the Eurozone being incorporated in the EU Treaties, even though they had nothing to do with the UK, has left a very sour taste.

There is a fear that any extension of UK membership under Article 50 (3) could be exploited by the UK to block other EU reforms, and/or to improve the UK’s position in the competition between the EU and the UK post Brexit.

Granting the UK, which had decided to leave and chose the timing of its Article 50 letter freely, an extension of the time limit, would be seen by many as encouraging other sceptical EU states to use the threat of withdrawal as a bargaining tactic, or a means of getting votes in Elections.

In this context, taking a tough line with the UK is not seen as “punishment” of the UK, as much as being “self preservation” by the EU.

An extension of time under Article 50 (3) would mean that UK MEP’s would still be eligible to sit in the next European Parliament, at least until the extension period had expired and the UK was out.

A European Parliament Election in 2019 in the UK would allow the British people to debate the issue of UK withdrawal from the EU in a much more informed manner than was possible in the Referendum of 2016. The campaign, and the result, of the European Parliament in the UK in 2019 would give valuable guidance to negotiators.

It might confirm the decision to leave, or it might signal a willingness to change course.

Either way, under the Article 50(3) time extension scenario, this would happen before the UK had actually left the EU. So the outcome of a European Parliament Election, in the UK in 2019, would be politically meaningful.

If the result was decisive vote in favour of Remain candidates, the UK might have the option of withdrawing its Article 50 letter and staying on in the EU, under existing terms.

An extension of time under Article 50 (3) would facilitate a second Referendum, if that is what the British people want.

The choice would be much clearer than it was in 2016, because Britain would still be in the EU at the time of the Referendum. So staying in the EU in existing terms would be the clear alternative to accepting the Withdrawal Treaty and accompanying Framework document that would be presented in the Referendum.

Reapplying to join under Article 49, which would be the only option if the change of heart took place after the UK had already left the EU would be much more difficult. It would mean a whole new negotiation and different, and less favourable terms of membership, for the UK.

On the negative side, UK MEPs continuing in the European Parliament after the 2019 Election could play the role of spoilers. They could ally themselves with nationalistic and anti system MEPs from other countries, who simply do not want the EU to succeed.

A disadvantage of a time extension under Article 50 (3) is that it would interfere with the plans of a number of European leaders, including the Taoiseach and President Macron, to allocate some of the seats to be vacated by UK MEPs, to MEPs who would be elected from a constituency of the entire European Union. In the European Parliament itself, work is already being done on the allocation of the vacated UK seats, and some existing member states could get more seats. Beneficiaries might be inclined to resist an extension of time under Article 50 (3), but the European Parliament’s consent is not required. But keeping the UK in the EU is more important.

CONCLUSION

If an individual wants to withdraw from a contract, he can do so, but he would normally expect to have to compensate other parties to the contract for the damage his decision might cause. No consideration at all was given, during the referendum in 2016, to the impact, UK withdrawal would have on other contracting parties, notably on Ireland.

For all these reasons, I believe the UK, and the EU 27, need to take time out to think about where we are going with Brexit. Two years is not enough.

The confrontational atmosphere, engendered by the artificial time limits in Article 50, prevents a quiet discernment of mutual interests. It imposes a dangerous straight jacket.

As I have shown there are advantages but also profound difficulties, with all the options I have considered.

But, on balance, I believe the best way to reach a sensible outcome in the negotiation, that will do least damage to the political and economic relations between the UK and the rest of Europe, would be to forget about the Transition option, and agree a time extension under Article 50 (3).

That may not seem politically feasible at this stage, but I believe it will be seen in a different light by next October.

As I said earlier, if the EU side were to offer such an extension, at a moment when the full difficulty of the Transition option was becoming clear, it would change the dynamic in British politics.

If it rejected the time extension option in favour of the Transition option, the UK government itself would have to take the full responsibility

  • for entering what some Brexiteers have described as “Vassal status”,
  • for implementing rules they had  no say in making, and
  • for entering a period in which the UK would paying into EU funds, with no say in how the money was spent.

The rush for an early Brexit, that motivated Mrs May to write her Article 50 letter before her government had done its homework, was driven by a deep fear among the architects of Brexit that, if they did not leave quickly, they, or their voters, might change their mind about leaving at all.

This is, quite literally, an irrational basis for deciding the future of Britain.

It is a deeply dangerous basis on which Britain would impose the costs of its mistakes on Ireland.

It will leave deep and lasting scars.

I believe that an extension of time under Article 50 (3) of the Treaty is the best way to minimise, and possibly to eliminate, the damage.

====================================================

Speech by John Bruton, former Taoiseach and former EU Ambassador to the United States, speaking at the Skoda  Fleet Business event at 8 am on Monday 29th January in Bellinter House Hotel, Navan Co Meath;

 

The EU vote ignored Ireland, but the UK can still change its mind

By

On December 26, 2017

In BREXIT, European Union, Ireland

Let me first try to explain why the handling of Brexit by the UK led to a crisis in Anglo-Irish relations. Treaties between nations are like contracts between individuals. They influence how each party behaves, towards one another and towards the rest of the world. While a contract or a treaty can be withdrawn from, there is a legitimate expectation that this will only be done with careful advance consideration of how this will affect the other parties to the treaty or contract. This is not just a legal expectation, but an expectation of the sort of civility that should apply in relations between people and nations.

One also takes for granted that, if the withdrawing party to a contract wants a new or different contract with the same parties, it will say in advance what it wants that new relationship to be. Even now, Ireland has no clear idea what sort of relationship, compatible with the EU rules the UK helped make, the UK wants with the EU, and hence with Ireland. As the country most affected by Brexit, there is thus deep disappointment in Ireland that our neighbour the UK has not been able, in respect of Brexit, to live up to the normal expectations I have just outlined.

Forty-four years ago, Ireland and the UK signed the same contract with one another, and with the seven other countries that then made up the European Common Market. We each renewed that contract several times, in the UK’s case with the sovereign approval of its parliament. We each expected that the others would continue to honour the contract and we shaped our institutions and our economies on that basis. In particular, when Ireland and the United Kingdom negotiated the Belfast and St Andrews Agreements, to resolve the ongoing conflicts in and around Northern Ireland, we each did so on the unquestioned assumption that the UK would continue to be an EU member.

We each assumed that the freedoms created by membership of the EU could continue to be used to strengthen relations between the two communities in Northern Ireland, between North and South, and between Ireland and Britain.

The renegotiation and referendum process that was initiated by David Cameron, which has led to Brexit, seemed to us in Ireland to have been designed in a way that took no account of the obligations and expectations the UK had created in Belfast and at St Andrews.

During the renegotiation phase, the Irish taoiseach, Enda Kenny, supported Cameron’s attempt to improve the special status the UK already had in the EU, even though some of the concessions the UK were given weren’t in Ireland’s interest.

Irish people saw other problems with the process that led to Brexit. The complex UK/EU relationship was reduced to a simple “Leave” or “Remain” choice. While it was clear what “Remain” meant, no effort at all was made by the government sponsoring the referendum to say what sort of “Leave” it would choose. So “Leave” became a vehicle for fantasies and wishful thinking of the most egregious kind. Explanations of the choices between different forms of Brexit – such as on whether to stay in the customs union and the single market – were left over until the people had already voted.

There was no deliberative process to inform public opinion, something one would have expected of the UK parliament, one of the oldest democratic deliberative bodies in the world. The referendum was not preceded by detailed green and white papers. In the absence of authoritative information, there was no informed debate about the impact of Brexit on the Irish border, and on hundreds of issues.

It is only in the past week that the UK government has started to consider the sort of post-Brexit relationship it will ask for. In doing so, it will have to take account of the fact that the EU works because it is a single legal order, with a single system that makes, implements and adjudicates on the meaning of shared EU rules. The UK has a sovereign right to decide what it would like, but it cannot expect the EU to change its very nature, just to accommodate a country that is leaving.

In preparing its proposal, the UK will need to take into account the Interlaken principles that govern EU relations with third countries, and the EU community customs code, both of which UK ministers helped to draft. When it has done this, the UK government can then compare the special position it already enjoys as a voting EU member, with what the EU will be in a position to offer it as a non-member. Then it can make an informed decision. We are each allowed to change our minds in our private lives if the issue is important enough. Nations might sometimes allow themselves the same privilege.

Opinion @ The Guardian by John Bruton

Eurofound Forum

By

On November 14, 2017

In Europe, European Union

 

It is an honour to be invited to address the topic of convergence at this major event The goal of European convergence will not be achieved by experts or elites.

It will require the whole hearted support of the broad mass of the peoples of the European Union. In what say tonight, I will try to tackle that.

The Minister for Foreign Affairs has outlined to you today Ireland’s approach to the Brexit negotiations. I support all he said.

Tonight I would like to move beyond Brexit.

POST BREXIT EUROPE

I would like to talk about what the European Union might look like in 2025, the date by which I expect the UK will finally have settled on its relationship, as a non member, with the EU.

I do not, of course, exclude the possibility that the UK will change its mind about leaving, but the two year time limit of Article 50 has, unintentionally, created a hot house atmosphere in which a re examination of proclaimed positions is almost impossible, politically.

I have advocated that the 2 year period in Article 50 should be extended to 6, but, for the purposes of this presentation tonight, I will assume that we stick with the 2 years and that the UK will be out in March 2019, and have finally agreed a permanent relationship with the EU by March 2025.

Ireland will remain a full member of the EU, notwithstanding the fact that a large non member country will, from 2019 on, constitute a large geographic, cultural and political barrier between Ireland and the rest of the EU. This geographic difficulty can, and will, be overcome but it will require extra commitment here in Ireland, and in the rest of the Union.

REDUCING CULTURAL BARRIERS WITHIN THE EU

For the service sectors of our economy, this geographic barrier will be manageable, but it will be much less so or the goods sector, particularly for food, where UK and EU tariffs and standards may diverge. Assurances on the permanent arrangements this point from the UK will be a key point for Ireland in any framework for a future relationship that might be agreed with the UK.

The potential cultural gap between Ireland and the rest of the EU is of equal long term significance. Irish people consume their news through English, and what we see that the English language media about the EU  is dominated by suspicious, and often under informed, Anglo Saxon notions about Europe, which go back hundreds of years. Yes, many Irish people do read French, German and Italian papers too, but they are in a minority.

In this context of avoiding cultural isolation, there are  two  of the aspects of President Macron’s excellent Sorbonne speech, which I especially welcome.

One was his setting a goal that all students should speak two EU languages by 2025.

The second one was and all EU 25 year olds should, by 2015, have been assisted to spend six months working in another EU country. This could be described as an “Erasmus for All”.

In practice, in the Irish case as far as language is concerned, that means being able to speak English and a continental European language as well.

If President Macron’s suggestion is taken up by the EU, each EU country should be benchmarked between now and 2025 on how far it is from the 2025 goal and EU funds allocated on a results basis.

As the European Parliament starts work on the next seven year budgetary perspective, it should allocate substantial funds to these goals and to the broader cultural unification of the European Union. We need to build a strong European Union sense of identity among people to go alongside their already strong national and regional identities.

The Erasmus for all idea is particularly important. Ultimately, in building the European Union, we are aiming to build a sense of shared identity among the peoples of this vast continent.

Among the minority of university students who have benefitted from Erasmus, I believe that has been a great success. But these students are part of an elite, and many are drawn from socio economic groups that that are pro EU anyway.

Extending the opportunity of Erasmus across the entire under 25 population would widen horizons for young people, and create a sense that the EU does good for everybody, and not just for the upwardly and outwardly mobile section of the community.

I hope the fact that educational policy is a primary function of the member states ( and in some cases of regions) will not be allowed to be an obstacle to action by the EU on these two activities, from which Ireland could gain,  and from which Ireland  needs more than most, because of the separation from the EU that Brexit will otherwise create.

BUILDING A COMMON EUROPEAN PUBLIC OPINION

It is said that Brexit will also create something of a political barrier between Ireland and the rest of the EU.

The absence of the UK at the table will create some difficulties on some regulatory issues, but even in my time in government, I felt that UK Ministers were beginning to disengage psychologically from the common EU goals, and to adopt a purely transactional, issue by issue, approach.  If everybody had done  that the EU would not last long.

The isolation of Irish public opinion from some of the thinking and ideas on the future of Europe in other countries is relevant.  It is natural that different countries want different thing from the EU, and their needs will change over time.  How much thought do Germans give to Greek public opinion about the EU, or vice versa? What Estonia expects of the EU will differ from what France expects.

If the EU is to work, voters in each country need to begin to understand, and take into account, the public opinion in other EU countries, and not just in their own.

We cannot just leave the job of building that better understanding to Ministers and diplomats alone.

One way of making the public opinions of all 27 member states aware of the public opinions in the other 26 states would be to have a genuine European Election for some of the seats in the European Parliament. This could be done by allocating the seats, soon to be vacated by UK MEPs, to a single constituency to elected on an EU wide basis. These seats could be filled from lists led by prominent figures who would have to campaign in all 27 EU states, and whose electoral programmes would have to be informed by the thinking in all of them too. It would harness democratic competition to build a shared understanding across national boundaries.

SECURITY THREAT AFFECT US ALL

In his speech, President Macron laid great stress on the security threats facing Europe, from terrorism of which France has had more than its share, and from the inevitable, if gradual, disengagement of the United States from European military security. He also raised the threat to EU security from civil wars in our neighbourhood and the resultant refugee flows.

As an island of an offshore island, Ireland has been able to take more relaxed view on some of these matters.

But there are fewer and fewer threats nowadays, from which the sea is a sufficient protection.

Cyber attacks can be used to disable critical infrastructure, to alter medical records, to spy on personell files  and thus to create opportunities for blackmail.

As a highly internationalised high tech and  service economy, Ireland is vulnerable to these threats, especially now that so much of our energy supply will come to us through a non EU member state.

Ireland should work to through the EU and Partnership for Peace to strengthen its cyber defences. President Macron envisaged a European Intelligence Academy, which is also something from which smaller EU states could benefit.

WORKING CONDITIONS

This conference is concerned with working and living conditions. These will come under increasing stress as our population ages, and as proportionately fewer people of working age find themselves  having to pay for the health and pension entitlements of a ever increasing retired population.

Germany, the dynamo of the EU economy at the moment, will be hit by this problem sooner than most of us. The median age in Germany is 47, whereas the median age in the US is 38, and that affects relative dynamism. Like Italy it is getting older faster, and this is not fully taken into account by some commentators when they look to Germany to loosen its purse strings  for the good of Europe.

President Macron suggested a European Labour Office to help achieve fair and equal pay for the same work. I expect your discussions here today will have made suggestions as to what this office might do.

He also recognised the competitiveness challenge that the EU economy faces.

THE NEED FOR INVESTMENT

Competitiveness is enhanced by investment, more so even than it is by wage restraint. In the past ten years in Europe, we have had wage restraint, but not enough investment.

One area of investment for the EU is the electricity grid. If renewable energy is to replace fossil fuels, we will have to greatly enhance our electricity grid across the EU quickly, and in a cost effective way. Ireland has something to learn here.

We will also need to ensure that the EU is in pole position in R and D. That is not the case now. Rand D spending is 2% of GDP in Europe as against 2.8% in the US and 3.5% in Japan.

The spin off from R and D is best if it takes place in clusters. These clusters are usually around big cities, where people can move from job to job, without moving house. And Europe has no technological clusters of this kind, whereas the US had two or three.

President Macron suggested the following, and I quote

“  I want Europe to take a leading role in this revolution through radical innovation.  I propose that, over the next two years, we create a European agency for disruptive innovation in the same vein as the Defense Advanced Research Projects Agency (DARPA) in the United States during the conquest of space.  This must be our ambition.  Today, we have a unique window to do it.  We must drive this ambition, finance research in new areas such as artificial intelligence, and accept risks.  Such an agency would make Europe an innovator and not a follower.”

Objections will be raised to this.

Is a European Agency the best body to pick winning technologies? Will it become prey to national rivalries within Europe? Will firms that have non EU parents, of which there are many here, be eligible to participate?

But the idea is forward looking and its adoption would suggest that Europe is awake to the challenges of the modern world.

INCOME INEQUALITY

Another theme at the conference here today is the growth in income inequality across the world, not just in the west, but also in Socialist China. This divergence has been most rapid since 1988

The European Parliament’s Global Trends Report 2035 puts it this way

“Economic inequality has grown in the United States and Europe for most of the last thirty years in real terms and in political salience. The gap between the rich and poor was described as a “very big problem” by a majority of respondents in France, Italy, Spain, and Greece in a 2014 Pew survey.”

They measured this by comparing the share of income earned by the top 1% with the rest of society. From 1949 to the mid 1980’s that share actually fell slightly, but, since 1988, the gap has widened.

Of the countries surveyed the growth in inequality has been fastest in the United States and the UK, but significantly less in France , Netherlands and Sweden. I believe Ireland would be somewhere in between.

The factors causing increased inequality are identified, by IMF researchers ,as

  •  technological change,
  •  globalisation,
  •  less union protection and
  •  tax policies.

Their view is that this problem will not solve itself over time. In fact it could get worse. New technologies, like artificial intelligence and driverless cars, will hit lower income jobs first.

A big challenge will be designing a combination of tax and social security measures that mitigate inequality without leading to the flight of capital and talent from the countries that take a lead in this field. I do not see the EU taking a prescriptive lead in this matter, but I do believe it should disseminate best practice.

It should also use its competition and state aid policies to ensure that the tax base is as wide as possible. The wider the tax base the lower can be the tax rate.

CAN EU POLICY MAKING BE IMPROVED?

I would like now to say a word about how the EU sets is policies.

Increasingly the agenda of the EU is being set by the 28 or 27 elected Heads of State and Government (HOSG), rather than by the European Commission, as might have been envisaged with the Monnet method.

This is because HOSGs face their electorates in way that Commissioners do not, and because much of the EU’s work combines EU and national action.

But there is a disadvantage, in that HOSG’s are part time Europeans. They have heavy domestic agendas. With 28 of them around the table, it must also be very difficult to brainstorm and avoid the tyranny of a pre set agenda.

Commendably, the Council President Tusk has set out a detailed rolling agenda for all the meetings right up to June 2019.

That gives civil servants time to prepare, but does it allow Leaders enough time to think?

Thankfully President Tusk has also increased the frequency of meetings, and that will give HOSGs more time to think together about the longer term issues.

THE EURO

Finally I will say a word about the euro. A lot has been done to underpin it. But private and public debt levels are still considerably higher than they were before the 2008 crisis.

I do not believe the EU needs an ongoing transfer union to underpin the EU. Transfers are already reaching 4% of GDP in some recipient countries.

But a facility is needed to help euro member countries that are hit by an asymmetric shock (a big migration surge, a technological shock, or even Brexit).

Some form of temporary top up from EU funds for Unemployment Relief might help.

A Limited form of European Bank Deposit Insurance would be good. It should be combined with a restriction of banks buying too many of their own countries bonds and thereby creating the risk of banks dragging down their own governments if they get into difficulty.

It is much better to allow the markets to discipline governments that borrow unwisely through interest rate differences than it would to try to achieve the same goal by threatening fines after the country that is already in trouble.

CONCLUDING REMARKS

I thanks Eurofound for the contribution it has made to the EU since 1978 .

I pay tribute to our late President Paddy Hillery, whose initiative Eurofound was when he was Commissioner for Social Affairs.

I hope the deliberations today will help make a big success of the Social Summit of the EU in Gothenburg next week

Speech by John Bruton, former Taoiseach and former EU Ambassador to the United States,  at the Gala Dinner  of the Eurofound Forum in the State Rooms, George’s Hall, Dublin Castle at 7.30pm on Tuesday 12 November

TIME LIMITS RISK A BREXIT CRASH

By

On October 6, 2017

In BREXIT, European Union, United Kingdom

RIGID TIMELINES COULD LEAD TO A BREXIT DISASTER…..SCOPE AND TIME FOR CREATIVE THINKING NEEDED

In his book “Fateful Choices”, which describes how country after country tumbled into what became the Second World War, the British historian, Ian Kershaw wrote

“The fateful choices that were made were not predetermined or axiomatic. But they did reflect the sort of political system that produced them.”.

A Global War was not anyone’s preferred option, but a combination of ideology, a fear of being encircled or pre empted, and miscalculation of the intentions or reactions of others, gave the world the most destructive war in human history.

Similar blind forces are in play in the Brexit negotiation.

The current UK political system, and the anxieties and obsessions it has generated, determine the UK position on Brexit.

This expresses itself in an artificially inflexible, and brittle, interpretation of the meaning of the 2016 Referendum result.  

The UK Government has so far been unable to convert that into a detailed, legally viable, and constructive, outline of its desired future relationship with the EU.

If it got into detail, the disagreement between Cabinet members is so deep that the Conservative Party would split and the Government would fall. The Labour opposition has a similar problem.

It suits both of them that the EU side in the negotiation is insisting that substantial progress must be made on other issues, before negotiations about the future relations between the EU and the UK begin, because if the UK Government had to set out a detailed position on the future relationship, it is liable to split. UK party and public opinion has been polarised and is unready for compromise. The Conservative Party is consumed with its leadership struggle and cannot be relied upon to make a deal that will stick. The Foreign Secretary’s four ”red lines” make compromise impossible.

Likewise the EU political system determines the EU’s approach. There is quite understandable annoyance that the UK, for whom so many special deals were made in the past, now wants to leave the Union it freely joined over 40 years ago. The EU negotiating position is necessarily inflexible because it has to be determined by 27 countries. It can only be changed by consensus among them, and that can only be arrived at very slowly.

Yet the time limit set in Article 50 of the EU Treaty is very short. It will require immense speed of negotiation, on a vast range of difficult questions, not only between the EU and the UK, but also potentially with the World Trade Organisation and perhaps with EFTA, which the UK would have to join if it wants to be in the European Economic Area, like Norway. All this will have to be done between January and November of 2018.

Both sides in this negotiation should ask themselves this question……Are they at risk of finding themselves on rigid tramlines, heading straight for a cliff, and if so, should some rail sidings be put in place, into which the two trains might pull, for a moment of reflection, before they go over the edge in March 2019?

A  former Judge in the European Court of Justice, Franklin Dehousse recently  argued that separating  trade issues from those concerning the  Irish border  artificially disconnected connected topics, and thus  limited the possibility of constructive tradeoffs.  

But he also insisted that the UK must first come up with “precise proposals on all withdrawal matters”.  

He is right. There is no point in the UK asking for the EU to move on to trade matters,  unless and until the UK itself is capable of spelling  out in substantial detail  what it wants, and says exactly what  trade, environmental, and consumer safety policies it will follow post Brexit. It is because the UK is unable even to say what it wants, in the long term, on these issues, that there has been no progress on discussing Irish border issues.

Meanwhile  the UK Trade Policy Observatory (UKTPO), in an article by Professors Alan Winters, Peter Holmes and Erika Szyscak, has suggested that Theresa May’s idea of a “transition” or “implementation” period of two years, after the UK had left the EU, might be very difficult to implement. If so, the UK will crash out of the EU in March 2019.

They saw several problems with Theresa May’s transition idea. They are not trivial issues..

One was that, when the UK leaves the EU in March 2019, it will also be automatically out of the EU Customs Union too. Therefore they claimed it would have to negotiate a new temporary Customs Union with the EU, for the transition period. It would have to notify the WTO of this new temporary Customs Union, which could potentially lead to protracted negotiations with WTO partners.

The UK and EU would also have to agree on how all EU Regulations and Directives would apply in the UK during the transition period, with complete certainty on how mutual recognition of testing and certification,  and the free mobility of labour, would work.

According to the UKTPO authors, the status of such an agreement under EU law would not be certain, but because it would cover issues on which EU member states retain competence. This might mean that the transition agreement itself might require ratification by all EU member states too. That would take time, and meanwhile the UK and its EU trade partners would be in limbo. The UK might be already out of the EU,  while its transition deal had not yet been ratified and was inoperable.

Given the delays ratifying the EU/Canada deal, which got bogged down in the politics of the French speaking part of Belgium, this is a daunting prospect.

Imagine going through all that for deal that might only last two years, and then going through the same process ALL OVER AGAIN for the final deal!  

So negotiating and ratifying a transition deal could be almost as difficult as negotiating the final permanent deal!

The UK needs to engage itself seriously with the complexities of Brexit.  If it looks at all these complexities thoroughly, sense is that it may then conclude that, despite Boris Johnson’s anxiety to leave quickly, the time limits are far too severe and that more time is needed.

If the UK was wise, it would ask its EU partners to extend the negotiation time from two years, to (say) six years.  That extension of the negotiating period could be done by unanimous agreement among the 27 EU states and Britain.

With a longer negotiation period, the UK would need no transition deal and would remain a member of the EU, until the final exit deal was done. There would be only one deal to negotiate and ratify, the final deal.

There are really no good options here.

.It would be politically difficult for any UK government to ask for an extension of the negotiation time. “Leave” supporters would suspect betrayal.  There would be very deep reluctance on the EU side to grant such a request.. Some EU states would feel that extending the period was being far too easy on the UK, and that the UK needed a reality check.  Others would argue prolongation of the exit negotiation might destabilise other EU members, and distract the EU from other urgent work.

These are valid objections, but they are arguably less damaging than the real likelihood that the UK will crash out of the EU without any deal.

Lengthening the period to six years would, however, allow the UK electorate to consider, in a more informed way, the full implications of the course they are following.

The present tight time frame minimises the opportunity for creative thought.

Instead, it maximises the influence of blind bureaucratic and political forces.

It increases the likelihood of miscalculation, and of the UK leaving the EU with no deal at all. That would be very bad for Ireland, or for the EU as a whole.

 I hope more negotiating time can be agreed.  If not, the tempo of the negotiation must be immediately and dramatically increased.

Unfortunately, there is little sign that the current UK government, the originator of Brexit, sees this.

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