Backstop, Boris Johnson, Brexit, Employment law, Labour Law

Deregulation is the beating heart of #Brexit.

This blogpost was written on Sunday Oct 27th

Delors TUC Conference

With each passing day it becomes clearer and clearer that Brexit is not just about the UK leaving the European Union. The real debate, often hidden but which breaks through into the light every so often, is around what sort of society the UK wants to become and what sort of economic model it wants to pursue if and when it does leave the EU.

Now, for those with eyes to see, there are hints in Withdrawal Agreement currently before parliament as to how Johnson’s Conservative Party plans the future. “Singapore-upon-Thames” it is.

A week ago, Saturday morning, October 19, Johnson opened a Commons debate on the new agreement he had just negotiated with Brussels. Initially, the deal was seen as little different from the one that Theresa May, the former prime minister, had laboriously worked out over the past two years, though with two major differences.

First, the all-UK backstop, which would have seen the UK stay in a customs union with the EU at the end of the transition period if a trade agreement had not been negotiated by then, was dropped in favour of a Northern Ireland-only “frontstop”.

De facto, the “frontstop” would see Northern Ireland remain in the EU’s custom union and single market, though single market membership would be limited to goods and not services. (The question of how you differentiate between goods and services in a modern, digital economy has yet to be answered).While it voted to remain in the EU by 56/44, because of the nature of politics in Northern Ireland only the ultra-unionist Democrat Unionist Party (DUP) take their seats in the House of Commons, with Republican Sinn Féin “abstaining”. Because of this, many in the UK see the DUP as the “voice” of Northern Ireland and that “voice” was angry at what it saw as Johnson’s betrayal of the “Union”.

For Johnson’s deal would require a border in all but name between Northern Ireland and the UK while eliminating the need for a border between Ireland and Northern Ireland. Gone, at a stroke, was the DUP’s hope that Brexit would see new barriers between Ireland and Northern Ireland, new walls behind which unionists could rest secure. Dublin’s “interference” in Northern Ireland, as provided for in the Good Friday Agreement, would not now be rolled-back.

That anger became even more intense when it emerged during the week that costly paperwork would be required for the export/import of goods between the UK and Northern Ireland. First, the UK government denied the need for such paperwork and when that line became unsustainable, said it was nothing more than a minor administrative matter. “Heaven forfend”, to borrow a Boris Johnson phrase, that such paperwork should be seen as a “customs declaration”. (See here)

Then it emerged, in a story broken by Buzzfeed, that before he cut the deal with Brussels Johnson had actually been made aware of the need for customs paperwork between NI and the UK once the “frontstop” came into play. But he went ahead and inked the deal anyway.

To put it bluntly, there is no escaping the obvious conclusion. Whereas Theresa May had been prepared to curtail Brexit ambitions to defend the “precious, precious Union”, Johnson was more than happy to break the Union to deliver Brexit. English nationalism, for which Brexit is the prize, trumped British Unionism.

Scotland took note, here. “Sinn Fein” is Gaelic for “Ourselves Alone”. Johnson’s Conservative Party is now England’s “Sinn Féin”.

If Brexit means breaking the Union could the DUP switch from backing Brexit to supporting the UK as a whole remaining in the EU as a way of saving the Union? Stranger things have happened. What all of this may mean for the future of the island of Ireland is brilliantly analysed by Fintan O’Toole here.

The second major difference between the Johnson and the May deals is that the non-binding and aspirational Political Declaration attached to the Johnson deal calls for a much “thinner” future relationship between the UK and the EU than May envisaged. Presumably, the UK thinks that the barriers to trade in goods and services that this thinner relationship will create will be more than compensated for by all those trade deals the UK is just about to negotiate across the globe.

But back to Saturday, October 19. Johnson and his people had made it clear that he wanted the deal put through the Commons, done and dusted, within days so that he could keep his promise that the UK would leave the EU on October 31 next and he wouldn’t have to “die in a ditch”.

Suspicious that there was more to his deal than met the eye and in order to thwart his timetable opponents put down an amendment that the final vote on the Brexit deal could only be taken once all the relevant legislation had been tabled and adopted. The amendment was accepted by the Commons.

As there was no deal agreed between the UK and the EU on October 19th then, in conformity with the Benn Act, Johnson was forced to write to the EU asking for an extension to the Article 50 timeline. He did so grudgingly and with ill grace, sending the letter but refusing to sign it.

Last Monday, the government published the Withdrawal Agreement Bill (WAB), the legal text which would transpose the Johnson deal into UK law. Johnson offered three days of parliamentary time for MP’s to read, digest and debate the 500 plus page legislation. On Tuesday, MPs actually voted to back the Johnson deal in principle, but also voted to reject his proposed timetable of pushing the Bill through parliament within the week.

Once MPs had the WAB in their hands some “hidden delights” in the text were quickly found.

First, it became clear that statements from Johnson, and commitments by other government ministers to certain Labour MPs, that EU-derived workers’ rights would be safe after Brexit may not have been as solid as they seemed. As the commentator, Chris Grey put it:

The second issue to emerge was over workers’ rights protections. It was already controversial that these had been moved from the Withdrawal Agreement (WA) to the non-binding Political Declaration (PD). In the legislation, a bizarre pair of clauses has it that a minister introducing any future legislation must state that it doesn’t reduce such rights compared with EU provision or that the minister is unable to state that but wants to proceed with the legislation anyway! I suppose it is conceivable that this was a drafting error but if so, given the political charge of the issue, an extraordinary one.

In other words, there was no guarantee on workers’ rights other than a minister would make a statement in the future saying that legislation might, or might not, protect such rights. Smoke and mirrors.

On Friday last, Jim Pickard of the Financial Times reported on a leaked DEXEU paper on employment rights after Brexit. According to Pickard:

The British government is planning to diverge from the EU on regulation and workers’ rights after Brexit, despite its pledge to maintain a “level playing field” in prime minister Boris Johnson’s deal, according to an official paper shared by ministers this week.

The document said the UK’s and EU’s “interpretation of these [level playing field] commitments will be very different” and that the text represented a “much more open starting point for future relationship negotiations”. It added that London believed that binding arbitration would be “inappropriate”. The document boasts that “UK negotiators successfully resisted the inclusion of all UK-wide LPF rules” in the previous Theresa May deal.

Pickard quotes Jenny Chapman, Labour Brexit shadow minister as saying:

 “These documents confirm our worst fears. Boris Johnson’s Brexit is a blueprint for a deregulated economy, which will see vital rights and protections torn up”.

The only surprising thing about any of this is that is should come as a surprise to anyone. A deep hatred of European social and employment law lies at the very heart of the Brexit project. In fact, it is what kickstarted the project in the first place.

In 1988 Jacques Delors, then EU Commission president, delivered a speech to the Trade Union Congress (TUC) annual meeting in the UK. Delors stressed the importance of the social dimension in European thinking and the need for a legislative program of labour laws to deliver on that dimension.

While the TUC responded to the speech with wild enthusiasm, Margaret Thatcher reacted with cold fury. Within weeks, she went to the College of Europe in Bruges and set out a vision of a “Europe of the Nations” as a counterpoint to Delors “ever closer union” roadmap. The birth of Tory Party Euroscepticism, which later hardened into Brexit, is widely credited to Thatcher’s Bruges speech.

At the same time, the UK government was challenging the need for British employers to inform and consult with employees’ representatives over collective redundancies and the transfer of undertaking in the European Court of Justice.

The UK was also arguing that the transfer of undertaking legislation should not apply to public sector outsourcing. In a separate action the UK government questioned the legal basis on which the Working Time Directive had been adopted. The UK lost on every count in each of these cases.

Then, in 1992, Thatcher’s successor as prime minister, John Major, secured his opt-out from the Maastricht Treaty’s social chapter. “Game, set and match” UK newspapers headlined shouted. The opt-out was only reversed when Labour returned to government under Tony Blair in 1997.

Brexit gives the Tory Party the chance to throw off the shackles of “overbearing and costly” European labour laws. Whether you think this is a good thing or a bad thing will depend on your own political preferences. But to deny that this is part of the Tory Brexit agenda is folly. Deregulation is the beating heart of Brexit. As Lord Lawson commented: “Brexit allows the completion of the Thatcher agenda.”

Since Pickard’s story broke the government has denied the truth of it. But as the Nye Bevan, the post-war Labour politician once said: “You don’t have to gaze into a crystal ball when you can read an open book.”

MPs also discovered that the WAB sought to lock-in the Johnson-preferred direction of travel on the future relationship between the UK and the EU as set out in the Political Declaration. While the Withdrawal Agreement will have the force of an international treaty, the Political Declaration does not have that status. This led many to believe that perhaps Brexit could be softened during the relationship negotiations in the transition phase. The WAB seeks to close this option down by building Johnson’s agenda into UK law.

Johnson wants a hard, deregulatory Brexit. Which makes the chances of a trade deal between the EU and the UK anytime soon close to impossible. Which brings us to the final “delight” MPs have discovered in the WAB.

It seems that the WAB would prevent MPs instructing the government to seek an extension of the transition phase if no deal was in sight. Such a request would have to be tabled by July 2020, some eight months away, to take effect from December 31, 2020. I have yet to find any knowledgeable commentator or trade expert who believes that even a “bare-bone” agreement (bone singular, not even plural) can be done in the time available.

If that is the case then it would be solely in the hands of the government to decide on the next step, which could include taking the UK out of the EU with no-deal. The WAB does not eliminate “no-deal”, merely postpones the possibility and takes the power to stop it away from MPs.

Yet, who knows what the composition of the UK government will be in the next few weeks, never mind the middle of 2020?  After MP’s rejected his turbo-track WAB timetable, Johnson announced that he was again going to try to force an election. However, the Fixed Term Parliament Act (FTPA) takes the actual power to dissolve parliament and call an election out of the prime minister’s hands. To dissolve parliament, he needs a two-thirds majority of all MPs. As I write, it seems very uncertain that he can get that number.

But no sooner had I written that last sentence than a “breaking news” story appeared on the screen. It seems that the Liberal Democrats are prepared to offer Johnson an election deal if the EU offers the UK a three-months Brexit extension to allow the election to be held.

If true, we could see an election in the UK in December. Then again, things may have changed again by the time you read this.

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