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Withdrawal Agreement Stalls Again

 

With the clock ticking, Government has once again decided to re-open Brexit negotiations with Europe. Read Jack Simpson's thoughts on what happened this week.

With under 60 (SIXTY!) days to go, Government has announced that it will head back to Brussels to renegotiate the Withdrawal Agreement, which it has spent two years negotiating, and the same Agreement that both the Prime Minister and heads of EU member states have described as “the only deal”.

This is the Agreement that would allow us to leave the EU and talk about our future Relationship, and you can read our Chamber dissection of it here.

The Vote

Following the monumental defeat of the Withdrawal Agreement two weeks ago (202-432 MPs), Theresa May was forced to propose a ‘Plan B’, which would then be voted on. A proposal by Conservative MP, Sir Graham Brady, was passed that said Parliament will support the Agreement if “the Backstop can be replace by alternative arrangements” (Protocol to avoid a Hard Irish border).

This sounds simple in writing, but it is hard to imagine this being fulfilled without a full working solution to the Irish Border. Theresa May herself said she will get “not a further exchange of letters but a significant and legally binding change to the withdrawal agreement”. What's more the Government itself backed this proposal, meaning it's much harder for them to 'fudge' their way out without seriously upsetting their own party.

The Conservatives were tearing themselves apart (and making some ludicrous headlines) about a year ago on how to solve the Irish Border. While technological solutions have been suggested, estimates say we are still ten years off proper development and implementation. It is very unclear what “alternative” practically exists to create an invisible yet working border.

Theresa May has promised a Meaningful Vote on the renegotiated deal (how many is this now?) by 13th February, and will make a statement to Parliament if she fails to do so.

However, the heads of the EU states, especially Republic of Ireland, have already ruled out re-opening the negotiations, and ay herself must know this would be the case. So, other than kicking the can into the long grass, I struggle to see what this delay will actually achieve.

Continued Uncertainty

Needless to say, this has done nothing to offer business the certainty and clarity they need to trade confidently internationally. Consider that Government promised Brexit clarity by last March, a work framework by the Summer, with a deal completed in October, here we are, still unable to actually agree to leave.

Business figures, both Leave and Remain supporting, have become increasing frustrated at the progress of Brexit, and re-opening the negotiations of the Withdrawal agreement so close to the Brexit date, only further increases uncertainty and the threat of a Hard and disorderly Brexit

We are already beginning to see this uncertainty bite. While it is true that international trade has grown in the region since the referendum result, according to HMRC, the North East experienced a decline in exports both on the quarter and the year, including a 9% drop in exports to the EU.

In addition, the results to our Quarterly Economic Survey from the end of 2018 showed that both planned investment and recruitment were down for the region, and Brexit was cited as a key reason.

While members are planning, they are unable to act. It simply isn’t logical for a business to commit what resources they have towards an outcome that may never happen. Business instead have started stockpiling, which in turn is diverting growth from elsewhere.

Time is clearly running out, and it is beginning to harm our economy now, as well as our long term prospects. With a predicted GDP drop of 3-16%, if we are unable to secure long term confidence and investment in the region, then we will be threatened with an economic decline, potentially worse than the financial crash of 2007-08.

Put on Pause

That is why the Chamber is calling on Government to stop playing the martyr over Brexit, and extend the Brexit negotiations, rather than threatening its own allies and citizens with a No Deal that we ourselves are woefully underprepared for.

Our members have told us No Deal is completely unacceptable, and that they wish for a deal that allows them to continue trading competitively and undisturbed by Brexit changes. We will continue to use our current relationship with the European Union as a measuring stick to judge any future relationship.

By extending Article 50., Government would be given the chance to put a stop to the party politics, take a step back, and engage with the business, amongst other, communities, on their Brexit concerns. This will afford our politicians the chance to work constructively towards a deal that addresses the real and practical concerns of the business community, and put an end to this Brexit madness.