IPPR - May and Johnson’s Brexit Deals compared: A harder deal, less alignment and more barriers to trade

18 Oct 2019 11:16 AM

IPPR analysis finds Johnson’s deal points to harder Brexit than May’s

New analysis of the revised UK-EU Withdrawal Agreement and Political Declaration by the IPPR think tank finds that Boris Johnson’s deal with the EU is designed to facilitate a harder Brexit – with more trade barriers, greater regulatory divergence, and weaker protections for workers’ rights and the environment.

The IPPR analysis cuts across four areas of policy – Northern Ireland, trade, social and environmental protections, and governance arrangements.

Northern Ireland

The revised Irish protocol is now restricted to Northern Ireland – the previous UK-EU customs union has been removed from the text. As with Theresa May’s proposals, Northern Ireland is subject to a range of EU single market rules for goods, as well as the EU’s customs code. Moreover, given there will be no customs union between the UK and the EU under the new proposals, this is likely to lead to additional trade barriers between Northern Ireland and Great Britain.
The revised Irish protocol states that Northern Ireland will remain part of the UK’s customs territory. However, in practice Northern Ireland will be subject to the Union Customs Code and all necessary checks on goods will take place between Great Britain and Northern Ireland, rather than at the border between Northern Ireland and the Republic of Ireland.
The Irish protocol contains new provisions to limit tariffs being paid on goods moving from Great Britain to Northern Ireland. Where a good is not at risk of subsequently entering the EU via Northern Ireland, tariffs will not need to be paid. There will also be arrangements allowing for the UK to reimburse tariffs for goods brought into Northern Ireland, under certain conditions.
The Irish protocol is now in effect the ‘default’ arrangement for Northern Ireland after Brexit; references to replacing the protocol have been removed or played down.

Trade

The revised Irish protocol erases the UK-EU customs union from the original text. The ‘fallback’ trading arrangements for Great Britain and the EU if no future economic relationship is reached during the transition period are therefore equivalent to a ‘no deal’ scenario.
The new Political Declaration removes references to alignment with EU rules and explicitly recognises the need for checks on rules of origin as part of the future Free Trade Agreement. It also removes reference to a “spectrum of different outcomes” for future checks and controls on UK-EU trade. It therefore points towards a harder Brexit than May’s Political Declaration – involving less alignment with EU rules and so greater barriers to trade.

Workers’ rights and environment protections

Given the Irish protocol no longer includes a UK-EU customs union, it also no longer references ‘level playing field’ protections for social and labour standards (i.e. workers’ rights) and environmental standards.
The Political Declaration references how both parties should “maintain environmental, social and employment standards at the current high levels provided by the existing common standards”, a similar wording to the original text of the Withdrawal Agreement. But the Political Declaration is merely a statement of intent, not a binding commitment.
This means that ‘level playing field’ conditions are now at risk. They will be a central focus of the next stage of the Brexit negotiations, but for now, without the protections in the Irish protocol, there is less certainty that labour and environmental standards will be maintained after Brexit.

Governance

There is now an additional mechanism for the Irish protocol to secure democratic consent in Northern Ireland. This requires a majority of Members of the Northern Ireland Assembly to give their consent every four years after the end of the transition period - or every eight years if the decision has cross-community support.
The Political Declaration indicates that the Boris Johnson government envisages a weaker governance arrangement for the future relationship compared with the Theresa May government. The text no longer says that the arrangements for dispute resolution and enforcement will be based on the text of the Withdrawal Agreement and makes explicit where the Court of Justice of the European Union should not be involved in resolving UK-EU disputes.

Tom Kibasi, IPPR Director, said:

“This deal opens the door to a decade of deregulation. It puts workers’ rights, environmental protections, and consumer standards at risk. It places the whole British economy and the NHS on the table for trade negotiations with Donald Trump. So the deal may satisfy the ERG but it should terrify everyone else.”

“Even if the deal passes, which looks unlikely, Britain now faces years of difficult negotiations with the EU to conclude a trade agreement. This is only the end of the beginning of Brexit.”

Marley Morris, IPPR Associate Director for Immigration, Trade and EU Relations, said:

“Boris Johnson’s new deal with the EU paves the way for a rupture with the EU. The new political declaration reveals he is heading towards a more distant UK-EU relationship than Theresa May proposed, involving more trade barriers and less cooperation. And the Withdrawal Agreement removes the arrangements for a UK-EU customs union, thereby eliminating a key barrier in his ambitions for a hard Brexit.”

CONTACT

Robin Harvey, IPPR Digital and Media Officer, r.harvey@ippr.org

NOTES TO EDITORS

IPPR is the UK’s pre-eminent progressive think tank. With more than 40 staff in offices in London, Manchester, Newcastle and Edinburgh, IPPR is Britain’s only national think tank with a truly national presence.