Saturday, 25 June 2016

We've voted to leave. So...

Welcome to the new blog. We've moved past the campaign and the vote and as attention moves to executing a Brexit from the EU so it is the blog should move with it.

The political fallout of Thursday's stunning vote to leave the EU is a long way off settling. While the recriminations, denials and shock continue, we have to start looking at the next steps and their timings.

Regardless of claims to the contrary from some political figures, who have been badly misled about what is actually legal and what is in Britain's best interests, there is only one legal and treaty-bound way of beginning the withdrawal process - and that is sending a formal notification to the European Commission that the United Kingdom will be leaving the EU. This is set out in Article 50 of the consolidated treaties.

David Cameron claimed that in the event of a vote to leave he would make that notification immediately, triggering a two-year negotiation period with the EU. Thankfully, Cameron decided to resign instead so that someone else could perform the withdrawal duties he was loathe to do.

The media has been reporting that European leaders want negotiations over Britain's separation to start immediately. Some have suggested we are obliged to give the notification without delay. But the fact is there is nothing in the treaty that says when  the government has to give notification to kick start the two-year period. The decision regarding when to invoke Article 50 rests exclusively with Britain. And there are also some very good reasons not to rush to notification yet.

First, the UK is not anywhere close to being ready for the formal negotiation, and before it is triggered, the government and its negotiators need to speak individually to each member state to clarify what we and they want to achieve. Second, next May sees the French presidential election and between August and October the Germans will be electing their new government. If we invoked Article 50 now, we would be starting negotiations with people who may be replaced by others who may pursue a different approach, possibly rendering the first year of talks a waste of time and running down the clock.

While we wait for the French and Germans to deal with their elections we should be talking to other member states. It's the opportunity to reassure them about our intention to be a close friend and neighbour and to cooperate in mutual interest, beginning with a continuation of single market participation to the benefit of all parties.

We should also be preparing an application to join the European Free Trade Association (EFTA). EFTA member states are able to individually participate in the single market and having left the EU we would need to be in EFTA to be able to maintain market participation. This will be reassuring to businesses, non-EU investors and the financial services industry as it would mean no change to our current economic and commercial dealings.

The government should be getting ready for what comes next, both in terms of approach to the impending negotiations with the EU and EFTA, and also the training and readiness of civil servants who will need to upskill rapidly as Britain resumes responsibility for future dealings with other countries and speaking with our own voice on global bodies. That's plenty to be getting along with in the coming months.