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The year in Brexit   

Despite endless promises of post-EU jam tomorrow, Rishi Sunak’s government has been forced to eat humble pie over the last 12 months

Image: The New European/Getty

The past 12 months have been littered with grandiose claims about the benefits of Brexit and the ability of the UK to demand what it wants from the EU. But the sad and inescapable conclusion is that none of those benefits exist and that the UK has been forced into a number of embarrassing retreats and compromises.

A prime example was the Windsor Framework, which was announced in February, and negotiated and signed by Rishi Sunak. This deal with the EU was an attempt to clear the log jam of political, economic and business catastrophes that Boris Johnson had managed to create with his Northern Ireland Protocol. The Windsor deal is not perfect and the DUP has decided to boycott Stormont until it is removed. But it did end the long-running dispute between the EU and the UK.

The origins of that dispute lie within the deal that Johnson signed with the EU, which put a border down the Irish Sea. The intention was to keep Northern Ireland in both the UK and the EU’s Single Market. The PM described this arrangement as “the best of both worlds”, a strange claim since it suggests that the best thing for the UK to do now is to rejoin the Single Market – something that Sunak strongly opposes. Logic is not this government’s strong point.

As a result of the Windsor Framework, the EU lifted its block on the UK returning to Horizon, the huge European research programme. But then Sunak spent months pathetically trying to haggle over the costs of rejoining, while proposing some UK research system that would have been nothing but a pale imitation of the EU’s scheme. British industry and British universities were left pulling their hair out while the PM played games, probably an attempt to show the europhobes in the Tory party that he was reluctant to join anything run by Brussels. In the end, he bowed to the inevitable and the UK rejoined Horizon, as we all knew it would.

Perhaps an even bigger climbdown was the one over the EU’s CE mark, which appears on almost every product you own and proves that it has passed the EU’s rigorous testing standards and can be sold anywhere in the European Economic Area. The government had been proposing to introduce its own UKCA mark, which would show that a product met all UK standards and could be sold anywhere across the country.

British business rightly pointed out that the CE mark already did this. Introducing a second mark would mean retesting every product, at huge cost. They would still have to use the CE mark as well, which would mean testing everything twice. In the end the government backed down, the UKCA is therefore pretty much dead in the water and British industry will keep the CE mark, but with no say on the rules and regulations a product must meet in order to earn it.

It is, in short, the complete opposite of what Brexiteers promised, and it destroys their argument that Brexit would benefit British industry. Instead, it ties the UK to EU standards forever and reduces UK influence and control over those standards to zero. Even so, it is better than the alternative of having a UK-only testing regime that no one wants, respects or needs.

Much the same happened during the summer, with the introduction of the Retained EU Law Act, which Jacob Rees-Mogg wanted to use to abolish all EU laws still on the UK’s statute book. In the end most of them were left intact. The obvious problem – obvious to everyone except Mogg, it seems – was that changing every law, statute, rule and regulation overnight would have created pandemonium. It would have overwhelmed the Civil Service and heavily damaged the British economy.

Common sense prevailed at last, and this piece of legislative idiocy amounted to very little. The government also scrapped the role of minister for Brexit opportunities, which Mogg held. It is almost as if it knows there were never any opportunities out there, but is afraid to say so publicly.

But the country cannot rest easy with the comforting thought that the UK has abandoned all ideas of diverging from the EU. This will happen by a process of inertia unless the government adapts UK law and regulation to match changes taking place in the EU. A steady wearing away of the UK’s regulatory alignment with its largest market would spell huge trouble for almost every sector of the economy, for years to come.

Britain can’t afford much more of that kind of economic damage. Throughout 2023, the UK economy showed clear signs of suffering from the long-term and painful economic consequences of Brexit, with lower growth and even worse productivity, higher taxes, higher borrowing and a crumbling public sector.

Meanwhile the UK’s relationship with Brussels has been reduced to the odd technical discussion. It’s a pathetic situation that we will look back on fondly if the government ever goes through with its threats to leave the European Court of Human Rights, a move that would threaten the Good Friday Agreement, the Windsor Framework and large parts of the deal negotiated by Johnson.

Some time during 2023 the UK also postponed tests on all food and agricultural produce entering the UK from the continent. I have lost count of how often and when they have done this, it happens so often. It is possible that they delayed the checks for both the fourth and the fifth time this year.

No matter, the delays are needed because the logistics industry fears they will cause chaos, and food shortages. They will also increase food prices and inflation and the government seems incapable of building the infrastructure necessary to make them work. The checks are now due to be introduced in 2024, but don’t hold your breath. Experts still doubt it can be made to work; so either another delay is on the cards or we will just have to expect empty shelves and higher prices.

Meanwhile, without tests, the country remains vulnerable to adulterated and rancid food imports and the outbreak of major animal diseases, like foot and mouth. While British agriculture and food manufacturers are at a serious disadvantage as their exports are checked at the border, their EU competitors’ imported products aren’t.

The one policy that it seems safe to say was only possible this year because of Brexit is the scrapping of the cap on bankers’ bonuses. These bonuses were capped because they played such a large part in encouraging the reckless risk-taking that led to the Financial Crisis of 2008, which nearly destroyed the global economy. A Brexit win there for the UK.

Meanwhile, Foreign Direct Investment in the UK was down for the fifth year in a row and inflation was higher – both because of Brexit. But on the other hand, the UK’s free trade deals with New Zealand and Australia came into force. Those deals are so bad that the UK’s farmers are up in arms about them, our antipodean cousins are laughing at us about them and the economic benefits are so small as to be almost unmeasurable. The same is true of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership which the UK managed to join in July, even though it is a free trade agreement for Pacific nations. Unfortunately for the government, its claim that the deal would benefit the UK economy by increasing growth by 0.08% over 15 years turned out to be far too optimistic. The Office for Budget Responsibility now says the figure is half that, a mere 0.04% over 15 years; not exactly the Marshall Plan.

Kemi Badenoch, the trade secretary, has even been reduced to negotiating and signing Memorandums of Understanding with individual US states, and then pretending they are trade deals that will compensate for lost trade with the EU. It would be laughable if it were not so embarrassing.

Finally, the latest Brexit shortage is of MPs. The government seems to have run out of members of parliament, or at least ones capable of being ministers. So, it has recalled David Cameron, the former PM who was stupid enough to call the EU referendum in the first place. As foreign secretary he now has the job of trying to rescue something from the wreckage he helped create – fitting really, even if it is an impossible job.

It says all you need to know about the quality of the Tory government in 2023 that he has actually brought some heft and gravitas to the cabinet. Brexit seems not only to have irreparably damaged the UK but to have hollowed out the Tory party to a quite remarkable degree.

The “bastards”, the gammons and the swivel-eyed loons may have got their way on Europe – for now – but 2023 has made clear that they turned out to be a bunch of inadequate, incompetent third-raters who cannot face the reality of what they have done. They cannot find any real Brexit benefits because there aren’t any and so have had to compromise on their fantasy policies and unachievable aims, and overinflate the benefits of minor trade deals that they negotiated so very badly and which are costing the country dear.

Read more from Jonty Bloom on Substack

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