(Title Image: Welsh Government under Crown Copyright)
Last week, the Welsh Government published A Brighter Future for Wales: Why we should remain in the EU (pdf).
The document sets out the government’s assessment of, and official position in the event of, a “No Deal Brexit” having previously argued for a way forward which would respect the referendum result whilst ensuring the Welsh economy isn’t damaged.
The report says that all evidence points towards a “No Deal Brexit” being the most economically-damaging post-Brexit scenario, potentially causing the economy to contract by up to 8% and generating a £60billion black hole in the UK’s public finances.
Ministers from all government departments are set to provide AMs with an update on their “No Deal” preparations this afternoon; I’ll be covering that tomorrow. For now, I’m going to summarise what the Welsh Government’s “Remain and Reform” policy proposes.
Under a “No Deal”: World Trade Organisation (WTO) rules would be applied to UK-EU trade, meaning tariffs on exports and imports. It could cause significant disruption at ports and borders, including Fishguard, Holyhead and Pembroke Dock. The report warns of short-term supply chain issues in manufacturing which could cost the UK sector £18billion, while the market for Welsh lamb would collapse. Longer-term, there could be increased competition with countries that lack social or environmental protections, higher taxes and reduced productivity.
Under the Welsh Government’s “Remain & Reform”: The Welsh Government argue that any form of Brexit will harm the Welsh economy. Remain & Reform could see the setting of ambitious environmental targets, arguments for opening up the single market in services and stronger workers rights across the EU. There’s also a case for reforming the Common Agricultural Policy and improving the transparency of EU decision-making, with national governments legislating alongside the EU Parliament.
Under a “No Deal”: The report said the impact remains unclear as the UK’s new immigration regime hasn’t been properly outlined yet. Free movement would effectively end the same day as a No Deal and new immigration into the UK would be based on skills and earnings (set to be a minimum £30,000 a year) with a Settled Status Scheme for EU citizens already living in the UK. Employers and public services could find it more difficult to recruit skilled workers from abroad (particularly in social care and the NHS) and net migration to Wales is expected to fall by 57% over the next ten years.
Under “Remain & Reform”: EU law already makes it clear that freedom of movement isn’t unrestricted – there is no automatic right to stay in another EU member state longer than 6 months if you don’t have the means to support yourself, but the UK has never properly enforced this. The Welsh Government argues that introducing national ID cards “might be a price worth paying to address concerns about uncontrolled migration” in addition to requiring all EU/EEA migrants to apply for a national insurance number on arrival.
Funding & Investment
Under a “No Deal”: The UK Government hasn’t clarified how they’ll deal with future regional development funding or farming subsidies. There’s the possibility that the UK Government will go back on any promises made regarding guaranteeing structural funding and farming subsidies beyond 2020-2022. Universities would be particularly hard hit if funding wasn’t replaced, as would various employment and skills schemes currently funding by the EU.
Under “Remain & Reform”: West Wales & The Valleys would qualify for the highest level of EU structural support. Wales has a good track record of delivering these programmes and we would also fully participate in EU investment and research programmes like Horizon 2020 and Erasmus+.
Social & Environmental Protection
Under a “No Deal”: It’s unclear whether the UK Government “feels bound by current commitments” and they could be tempted to undercut EU standards to improve competitiveness. Consumer protections, environmental regulations and labour rights are all at potential risk – some of which are currently taken for granted in the UK such a “pet passports”, free medical care and mobile roaming rights.
Under “Remain & Reform”: All current standards would be maintained and it would provide the opportunity to co-operate on major issues such as climate change, with action at an EU level having far more impact than action at UK or Welsh level alone. Regardless of the outcome of Brexit, there would be a need to help heal divisions and “move on”.
The Constitution & Devolution
Under a “No Deal”: The Brexit process has highlighted the inadequacies of the UK’s constitution and mechanisms for joint-working between governments. The powers agreement has “worked reasonably well” to date. There would be a need for constitutional reform and a “No Deal” was likely to see the dissolution of the United Kingdom.
Under “Remain & Reform”: Devolved administrations need to be more fully involved in discussions on trade policy – Brexit or no Brexit – with arrangements similar to those used when the UK Government negotiates at EU level on issues which are devolved (i.e. agriculture, fisheries).
Transition in the event of Brexit
Under a “No Deal”: There would be no transitional period if the UK leaves without a deal and it would be dependent on several “mini-deals” on specific issues. Operation Yellowhammer outlines the potential consequences in more detail.
Under “Remain & Reform”: There would be no need for a transition programme, though the UK’s relations with the EU and its members have no doubt been “damaged by the incompetence and arrogance of the approach of the UK Government”.
“There’s no place like home”
At the risk of stating the obvious, this would’ve been far more useful if it were published in 2016.
There’s no second referendum on the table and the Welsh Government and Senedd have little to no leverage in terms of the mechanics of Brexit itself. As I think I’ve said about a thousand times, regardless of what their Ministerial title might say, or how many great speeches they make in the Senedd chamber, AMs are all passengers and BoJo’s driving the bus.
The report gives the impression of being one last spasm of Remainer angst within Cathays Park – perhaps even guilt at not having properly campaigned during the referendum.
It’s a good effort, but when the best hand you have left contains ideas like national ID cards and non-existent constitutional reforms it’s all a bit “throwing the kitchen sink” at it.
Short of a house landing on BoJo, it’s probably best for the Welsh Government and the opposition to concentrate their efforts towards preparing for the now almost inevitable No Deal, instead of clicking their heels together three times and wishing it will all go away.