Brexit: the new reality for the UK

stuart thumbnailStuart Nathan

Features editor


In post-Brexit Britain (or Brexiting Britain if you prefer) one of the many challenges we’re now facing is the sheer complexity of leaving the EU.

I wrote yesterday that Brexit is like pulling a bramble out of a shrubbery – it’s even worse than that. I’m put in mind of Prince Charming trying to hack through the thorns that had enveloped the castle of Sleeping Beauty during her century-long snooze.

I’m not even going to get into how complicated it will be to negotiate a new trade deal with the European Union, let alone the 53 other international markets, but even the matter of triggering our exit from the EU isn’t simple. I’ll try to explain why, and I hope readers will forgive the departure from purely engineering matters. I urge readers to do their own research on this: I am not a lawyer, and neither is anyone else who works on The Engineer. This is what I have gleaned from reading over the past few days.

We’ve all heard of Article 50 by now – it’s the mechanism in the Lisbon Treaty for a country to leave, and it fires the starting-gun on a two-year process for the exiting nation to negotiate a settlement with the rest of the bloc. That two years is fixed, by the way: it can only be extended by the unanimous decision of the Council of Ministers, excluding the ministers from the exiting country. If there’s no deal when it expires, the leaving country has no deal; will have to trade according to WTO rules, which are much less favourable than the terms we currently enjoy; and if, for example, the EU owes us money, we wouldn’t get it back.

The rules by which Article 50 is invoked are set out – it has to be invoked according to the constitution of the exiting state. It’s often said that the UK has no constitution, or at least no written one, but this isn’t true. What we don’t have, unlike very many other countries, is a single document called ‘The Constitution’. Instead, our constitution is spread through many statutes, clauses of statutes and so on, accreted over the centuries. A statute, for those who don’t know, is a written law. This is why the job of a constitutional lawyer is so much harder in the UK than elsewhere: they don’t just have to interpret the constitution; they have to find the damn thing too.

But the way we invoke Article 50 (or activate it, or trigger it; nobody even agrees on the terminology) is clear: it has to be done through ‘The Queen in Parliament’, which is how we do things in the UK. Let’s be clear that this can’t be avoided: if Article 50 isn’t invoked, we don’t leave the EU. This is important; the important word is ‘Parliament’, and the reason it’s important is that it isn’t ‘government’. You’ll notice used the word ‘important’ three times. That’s because it’s really important.

This decision can be taken by passing an Act of Parliament; in this case it would probably be one to repeal the 1972 Act that took us into the EEC, as it was then called. This isn’t instead of invoking Article 50; this is how we invoke Article 50. That means a debate and a vote of MPs, which itself presents a problem: the vote can’t be along party lines, because the main parties’ policies were both to stay in the EU. Even if it’s a free vote, where the MPs vote according to their own opinions, it doesn’t work, because very many MPs (including my own) hold personal opinions that are at odds with those of their constituents. And even once this is sorted out, the act has to go through parliamentary committees, the House of Lords (with all the lack of democratic accountability that implies), and back to the Commons. Neither quick nor easy.

There’s another option called Royal Prerogative. Despite the name, in practical terms it doesn’t involve the Queen. It’s a series of powers that are wielded by the prime minister which used to belong to the monarch but were gradually devolved as the principle of parliamentary supremacy became entrenched. As I understand it, Parliament could empower the PM to trigger Article 50 by a vote. But there’s another problem: by long-established precedent, Royal Prerogative can’t take away rights granted by Parliament (this is the sort of thing we fought a civil war over). Some of those rights include working in any EU member state, and being able to stand for the European Parliament and vote in European elections. The paradox is obvious.

The problem is that the referendum had no constitutional power. The UK typically decides things in Parliament, not by referendums; as a result, it just doesn’t have the mechanisms to put referendum decisions into practice. Effectively the referendum was just a very comprehensive opinion poll with a self-selected sample size of 33.6 million. Countries where referendums are more common arrange them very differently from the way ours was, and inconveniently differently from each other too: some require a ‘supermajority’ of over 50 per cent to make constitutional changes; and Australia, for example, will only accept the result of a referendum if all of the states agree on the outcome. It should be obvious that last week’s referendum fails on both counts. But re-running the same referendum on different rules sounds like an affront to democracy and would almost certainly be seen as such by the Leave campaigners and voters.

In the meantime, it’s incumbent on practical people like engineers to try to find ways through the situation and find ways to ensure the UK and its population prospers. As our readers will know, virtually all the industry bodies and a very large majority of companies were pro-Remain, and we rounded up some of their responses last week. One of the few big industry bosses in favour of Brexit, Lord Bamford of JCB, said: “European markets are important to many UK businesses, including JCB, and this will not change. We should look ahead to opportunities to trade more freely with the rest of the world, as well as building on existing trading relationships with customers and suppliers in Europe.”

Meanwhile the picture in other sectors is not looking disastrous. Adam McGiveron, a partner with legal firm Shakespeare Martineau, which represents clients in the advanced manufacturing sector, commented on Friday: “Despite huge volatility on the stock and currency markets, we have not seen immediate disruption to deals, and those that were due to complete today are still completing.” However, he added a note of warning: “Political and economic uncertainty is seriously detrimental to medium and long term investment plans. Our clients have been disappointed by the level of political debate before the referendum and we call on politicians now to turn the debate to a grown up discussion about our trading relations with the rest of the world.”

As it happens, this morning The Engineer’s editor, Jon Excell, is attending a summit on the future of the automotive industry, Britain’s biggest manufacturing exporter and one of its biggest employers of engineers. The summit is being held by the Society of Motor Manufacturers and Traders, and was scheduled before the referendum was held.

Through the awesome speed of modern communication networks, Jon tells me that the tone of the event so far is that the manufacturers expect (and will no doubt request) that the UK continues to trade freely with the rest of Europe, and will also allow European engineers with the appropriate skills to work in the UK, so our skills gap will be no more of an issue than it was before we voted to leave the EU (that is to say, an urgent problem which requires a strategy to address it, but at least we would be able to recruit people).

Eric Jonnaert, head of the European motor industry body the ACEA, said that he didn’t expect the situation to affect sales of UK vehicles. SMMT chief executive Mike Hawes commented: “our industry is deeply integrated in Europe, it's the single most important relationship we have,” and encouragingly, both Johan Van Zyl of Toyota and Adrian Hallmark of Jaguar Land Rover have talked positively about continued investment in skills and technology, the opportunities presented by developing low-carbon vehicle technologies and more efficient manufacturing processes.

According to Jon, nobody at the event is even prepared to speculate about what happens if Europe does not consent to tariff-free markets and free movement of qualified people. But as our politicians have all mentioned this as a plank of post-Brexit discussions and, as Lord Bamford has said, trade with the UK is important to the rest of Europe too, we must hope this comes to pass in whatever settlement we achieve – assuming, as we must, that we are to leave the Union.