The global economy is quietly on the upturn. That promises well for Britain outside the European Union, but requires an even tougher negotiating position from Theresa May if the opportunities afforded by global trade are to be delivered.
As this column has consistently argued, there are much greater influences on the United Kingdom’s economic performance than its membership or otherwise of the European Union. The price of oil and gas; the absence of major wars; the growth of China and India as major economies; the free-trade approach of the United States of America; the stability of the Euro; the benefits of soft power delivered through the Commonwealth, our overseas aid programme, one of the most effective system of ambassadors around the world, more by chance than be design, the ever-greater adoption of English as the language of international trade and commerce; our lack of productivity and infrastructure investment; and inadequate skills in the labour market.
Brexit will have little or no negative impact on most of those factors; but it will provide positive opportunities to reduce burdens of excessive regulation on businesses and our massive financial contribution to the EU’s seemingly insatiable appetite for ever more money. Regaining control of our own agriculture and fisheries, avoiding the net £10billion annual contribution we make to the EU budget and the removal of unnecessary external trade tariffs are estimated to give our national economy a post-Brexit boost of 6 per cent.
The tens of thousands of regulations on industry from Europe that will have to be dealt with are going to be a hurdle, but it is one our Government and its Civil Servants must address head-on with determination and speed. The plan, of course, as already announced is that in the short term most of the existing EU regulations are already the basis of British laws, or will need to become so in order that industry has certainty and security in its medium term planning and investment decisions.
The second stage to be addressed must involve the systematic review and repeal of those regulations which impose unnecessary burdens from the point of view of genuine consumer health and safety and reasonable protection of employees. The rest need to go. It was in 1994 that Michael Heseltine, glorifying in the title of President of the Board of Trade, promised a “bonfire of regulations” through which thousands would be examined and all those that were not justified would be repealed. It never happened, of course, and Lord Heseltine is still today one of the great remainers arguing against the outcome of the referendum and seeking to keep Britain in the over-regulated, economically stagnant backwater of the European Union.
Similar promises have been made by every government since Heseltine first promised to light the bonfire, and yet the number of regulations has grown, and grown and grown every single year. Piled up, they are now a mountain, not a bonfire and speedy, decisive action is required. That is where the problem lies. British civil servants are not used to speedy, decisive action, and they have a tendency to delay, to water down, in short to obfuscate and thwart the wishes of their political masters. The only civil servants better than ours in causing such delays are those in the European Union trade negotiating department who never actually delivered anything in terms of a significant trade deal between the EU and another major economy.
The other major issue alongside the challenge of delivering momentum to the deregulation drive is the fact that when any single regulation is considered, there will be winners and losers from its repeal or amendment. We can expect the two sides to squabble, giving an excuse for further delay.
There is, however, a solution. It would be a bold and challenging move, but it is deliverable. The Government could ask Parliament to ensure that the mountain of European law to which we are subject, either directly imposed by Europe or turned into domestic legislation already, is subject to a ticking time bomb of automatic repeal on a specified date if by that date the case, and a strong case at that, has not been made and accepted for the retention of a particular regulation.
Such a move would give civil servants, industry, and trades unions, as well as Parliament and other stakeholders, a real incentive to get on with the job of examining those regulations and making clear recommendations based upon tests, which would need to be defined now, not at some time in the future, as to their necessity in terms of economic, national or consumer protection. Just such an approach has been proposed by the Institute of Economic Affairs, and it could give Britain a huge economic boost immediately Brexit is delivered.
Announcing such a move, now, would strengthen Theresa May’s negotiating position tremendously in her coming talks with the European Union. It would make it quite clear that there is a vision for vibrant British economy outside the Union, that we can as a nation thrive as an independent, free-trading nation, and that it is in the EU’s interests as much as Britain’s for the exit negotiations to be conducted constructively to deliver the best possible outcome for both sides.
As others have observed, it was David Cameron’s failure to have such a Plan B, clearly set out in advance, that meant the European Union’s political elite were confident that they could offer him no “renegotiation” of any substance whatsoever and that he would still go back to the British people and argue for continued membership of the European Union. The EU called his bluff, but then so did the British people.
Theresa May, and the three lead Brexiteers, Liam Fox, Boris Johnson and David Davis, must not allow themselves to fall into that trap. The hand they should reveal is not the one that says what compromises Britain will make in the negotiations. It’s the trump hand, the one that we will play to win the game resoundingly if we don’t get a better offer from Brussels as we depart the EU.
Brexit is coming, and to get the best out of it, Britain, through Theresa May, needs to be bold and decisive.
This article first appeared in The Catholic Universe of 7th March, 2017.
Cllr Chris Whitehouse KCSG is Chairman of Westminster’s leading political consultancy, www.whitehouseconsulting.co.uk, Secretary of the Catholic Legislators’ Network, a Trustee of the Right To Life Charitable Trust, and a Member of the Isle of Wight Council (Cons. Newport West).