The bombshell ruling by the UK Supreme Court (UKSC) last week totally demolished the government’s policy of shipping asylum seekers off to Rwanda. The shock wave reverberated through Downing Street, little more than a tantrum’s throw to the north. Had Rishi Sunak not sacked Suella Braverman on Monday, there is no doubt she would have gone on Wednesday.
The former home secretary’s vituperative letter to Sunak accused him of “failing to deliver” not only on his vow to do “whatever it takes” to stop the boats but also on cutting legal migration using the points-based system introduced in late 2020. The fact she was responsible for implementing both policies seemed to have slipped her mind.
Figures for all types of migration have rocketed since Brexit, and since this was a key pledge and under the direct control of committed Brexiters for the last three years, many will view it as a serious downside. Braverman and Patel owed their ministerial jobs to Brexit, something that probably amounts to a pretty serious downside in any case given their record of incompetence.
Sunak proposes to bend reality
Sunak’s response came within hours. It was entirely in keeping with the whole Rwanda policy and therefore profoundly unserious, designed solely to buttress his teetering premiership. He announced talks had already started on a new “treaty” and he would pursue “emergency legislation” to declare Rwanda a safe country, something the SC had expressly said it was not.
Presumably, the prime minister thinks if parliament declares something to be contrary to reality, it is reality which must bend. Even Lord Sumption, a former UKSC judge himself and an advocate of the UK leaving the European Convention of Human Rights, wasn’t amused. The chair of the bar council, Nick Vineall issued an immediate rebuke:
“If parliament were to pass legislation the effect of which was to reverse a finding of fact made by a court of competent jurisdiction, that would raise profound and important questions about the respective role of the courts and parliament in countries that subscribe to the Rule of Law.”
As far as I can see nobody believes the emergency legislation has a snowball’s chance in hell of becoming law this side of an election and even less on the other side.
Against the backdrop of the continued chaos, we noted twelve downsides the week, so pretty light.
The economy
Perhaps one of the most depressing surveys of recent times was conducted by the European Movement (declaration of interest, I am a member) which collated the responses of 1,774 small and medium sized enterprises (SMEs). The result showed no less than 1,660 (93.6%) reported that Brexit had affected them negatively. The single biggest obstacle for businesses was said to be the paperwork needed to trade with the EU, in other words, the non-tariff barriers.
This was across all regions and all sectors and was a clear indictment of the decision to quit the EU in 2016.
And in yet another move revealing the pointlessness of Brexit, the FT are reporting the UK intends to emulate the EU’s carbon border adjustment mechanism (CBAM), in order to avoid creating what the paper calls more “damaging trade barriers”.
Imports from countries with lower carbon costs faced new levies under the EU’s emissions trading system. Chancellor Jeremy Hunt will now apparently ‘mirror’ the EU’s carbon pricing.
Sectors demanding alignment have been joined by meat processors as the industry trade body calls for an SPS (sanitary and phytosanitary) agreement with the EU. The British Meat Processors Association (BMPA) says the UK food sector is complying with EU standards anyway, but still has to jump through all the certification and SPS control hoops to prove it.
An SPS agreement would save hundreds of millions of pounds a year they say.
Funding
Regions that were expecting pledges by Brexit-backing ministers like Michael Gove to be honoured are slowly coming to the conclusion they are in fact worthless.
The two most recent stories are from Wales and Cornwall. During a debate in the Welsh Senedd, the economy minister, Vaughan Gething, described the UK government’s shared prosperity fund as being smaller, less flexible, and narrower in scope than the EU funding mechanisms it replaced.
Gethin warned that universities, colleges, businesses, and charities have had to scale back services, costing jobs in the process.
Cornwall opted to quit the EU with a 56% majority but now the county council has confirmed that the government funding stream that replaced the EU’s regional development money is set to run out next month, leaving a £230mn shortfall.
The council’s shadow cabinet member for economy described it as “devastating”. As recently as 2021 ministers had pledged that “total funding through the UK shared prosperity fund (SPF) will at a minimum match the size of EU funds in each nation and in Cornwall each year”.
In reality, Cornwall received just 43% of the EU funding it was expecting.
Northern Ireland
Once again, Northern Ireland figures in the dossier. The House of Lords European Affairs Sub-Committee has been told the Windsor framework has not corrected a “fundamental flaw” in the Northern Ireland protocol.
James Webber, a partner at the legal firm Shearman and Sterling, told MPs that the “deadweight costs of trying to work out which rules apply to you and in which direction divergence is affecting your business is likely to discourage investment” and will over time reduce competitiveness, productivity, economic and wage growth.
Webber’s fears maybe true in future years but for the moment Northern Ireland is forecast to do rather better that most UK regions, according to the professional services firm Pricewaterhouse Coopers.
They claim the Northern Ireland economy will grow at the second fastest rate in the UK this year, exceeded only by London. PwC says this is due to the province benefiting from “greater certainty through the Windsor framework and a large public sector”. Northern Ireland remains in the EU’s single market for many goods and intra-Island trade has doubled between 2016 and 2022 (see Dossier No 1419).
With equal access to both Great Britain and EU, the Northern Ireland economy could be said to provide a counterfactual for the UK had it voted in 2016 to remain a member of the single market, highlighting the low post-Brexit growth of nearly all other regions.
Border checks
Baroness Lucy Neville-Rolfe, a junior Cabinet Office minister has confirmed that checks on goods entering Britain from the EU will go ahead as planned in January next year. Delayed five times previously due to fears that EU suppliers were not ready to handle the necessary red tape, the Baroness said new technology would reduce paperwork “saving businesses over £500mn a year”.
She did not say what the total extra cost would be. The new checks are still expected to increase costs for UK importers and consumers, adding to inflation.
Marco Forgione, DG of the Institute of Export & International Trade, told The Grocer magazine last week that the constant delays were causing an “environment of distrust” amid business.
Research
The Telegraph reports that 60 or so British scientists working on ITER (The International Thermonuclear Experimental Reactor Project) at Cadarache in France have opted for French citizenship allowing them to continue working in France but “decimating the UK fusion research community.”
Once one of the lead nations in ITER, the UK has now signed an agreement with the US to work together on nuclear fusion after British attempts to rejoin the project foundered. The JET (Joint European Torus) fusion experiment at Culham in Oxfordshire, previously funded by the EU, will close at the end of the year.
Harmful chemicals
Campaigners are warning the UK is “lagging far behind the EU” when it comes to controlling potentially harmful chemicals. Under government plans, EU derived laws are to be loosened, according to The Guardian. Hazard information required to register substances in the UK is to be cut to an “irreducible minimum”.
The EU has introduced eight rules restricting the use of hazardous chemicals since Brexit, and 16 more are in the pipeline while Britain hasn’t banned any substances at all. The government is considering just two restrictions, on lead ammunition and harmful substances in tattoo ink.
Pharmaceuticals
Generic medicine manufacturers producing low priced copies of brand name drugs after expiry of the patents have invested around £4bn in almost 40 new or expanded generic pharmaceutical plants in the EU since Brexit, compared to almost none in the UK.
Mark Samuels claims the trade and cooperation agreement means the UK accepts EU regulations, but the EU does not accept ours, “sinking the UK’s manufacturing competitiveness and international influence on pharmaceutical regulation”.
Citizens
Travellers hoping for cheaper train tickets to European destinations may be disappointed. Three companies including the entrepreneur Richard Branson, are said to be looking at launching cross-Channel services rivalling those of Eurostar.
They may however be disappointed according to The Independent not because the high-speed Channel link lacks capacity but due to issues at St Pancras International station. Eurostar itself is forced to run services at 70% capacity to allow post-Brexit passport checks, a situation the paper claims is unlikely to improve when biometric security checks are introduced as early as next year.
