With the Brexit clock ticking, it can be hard for businesses to distinguish between rhetoric and substance in the negotiations and understand what really matters for them.
That is why techUK brought together some of the leading Brexit experts last week for a Breakfast Briefing to give business leaders a high-level perspective on its implications for the tech sector. Charles Grant, Director of the Centre for European Reform and leading authority on the UK’s relationship with the EU, gave a key-note address. He was joined by Nina Schick, Director of Data and Polling at Rasmussen Global, and Tim Durrant, Senior Researcher at the Institute for Government, for a panel discussion that was chaired by techUK’s Giles Derrington, Head of Policy – Brexit, International and Economics.
The event provided a fascinating insight into the state of play from those in regular contact with key players in the UK and Europe. Following the Prime Minister’s Mansion House speech (read our comment on the speech here) we have greater clarity on the Government’s objectives for the UK’s future relationship from the EU. However, the speakers were all agreed that British ambitions are being met with significant legal and institutional scepticism in Brussels, Paris and Berlin.
Given the day-to-day coverage of Brexit in the UK, it is easy to think that the world revolves around Brexit, but Charles Grant pointed out that Brexit simply is not top of the agenda for many European Governments. It is not receiving anywhere near the same level of attention, and if the UK wants an ambitious deal it will have to do the ‘deep thinking’ on how that could work itself. What’s more, the panel made the crucial point that fears that a good deal for the UK could spur others to reconsider their membership remain surprisingly high, particularly in Germany.
As Charles made clear, the task of securing a deal which meets UK ambitions is tougher due to Theresa May’s own red lines on the Customs Union, which she is determined not to soften because of the vision of the UK as a leading trading nation – though the UK has its own cards to play in security cooperation.
With concerns over gridlock, spurred by the Irish border question, our panellists were asked by attendees what the UK needs to do to progress negotiations with the EU. They were agreed that there will need to be further softening of red lines, the UK needs to be realistic about the process and what will be acceptable and, underpinning it all, improve its diplomatic efforts.
Tim Durrant pointed out that the UK is at risk of becoming a ‘rule-taker’ even before leaving the EU. With British efforts focused almost exclusively on the Brexit process, the EU and other member states continue to make progress on areas, such as the Digital Single Market, which will continue to impact on the UK long after it has formally left. The UK is seen as having one foot already out the door, its ability to influence in Brussels is diminishing as it heads for the exit. This highlights the importance of the Government continuing to engage in these developments while it is still a member. Tim suggested that the UK would need to significantly increase its presence in Brussels post-Brexit in the same way as Norway who have a large diplomatic mission to keep track with the work of EU institutions in Brussels.
It is expected that the end of March should see an agreement on a transition period but Nina Schick emphasised that it is far from certain that will be the case. The last crunch point, in December when ‘sufficient progress’ was agreed, took significant diplomatic efforts to get over the line. Whether that feat can be repeated this month remains to be seen. Even then, as Tim Durrant made clear, whatever final deal is negotiated the Government will face the hurdle of getting approved by the devolved administrations, as well as the UK Parliament.
If an agreement on transition can be reached it would at last provide some certainty that techUK’s members have been asking for. However, what was clear from our Brexit Breakfast is that there are plenty of twists and turns yet to come before any deal on Brexit is reached and businesses can truly determine the long-term impact of the deal.