Comment: Under starters’ orders

Comment: Under starters’ orders

Britain and the EU began Brexit negotiations on Monday with uncertainty about the shape of Britain’s exit now melded with uncertainty about the direction the UK government will pursue.

Before the June 8 general election at least the attitude of the government appeared clear even if none of the detail was.

Now the meaningless “Brexit means Brexit” has gone the way of May’s other mantra “Strong and stable”.

Westminster is caught on a hook – with a discredited prime minister kept in office by a handful of Unionists in a party founded to oppose civil rights by that voice of restraint, the Reverend Ian Paisley.

The Tories dare not call another election, yet they cannot easily proceed without one and, in any case, could see one triggered at any moment if May can’t keep competing sides in an internal civil war under control.

From the UK side, Brexit now appears to mean whatever the last person in the government to offer an opinion suggests.

Theresa May’s political appointments since returning as head of a minority government are difficult to read – and by the time you read this, she may even be gone.

She was forced to retain the business-friendly, soft-Brexit supporter Philip Hammond as Chancellor, whom she was expected to sack.

Hammond was due to deliver a speech in the City of London last Thursday night, warning of the dangers of a “hard” Brexit.

The speech was cancelled following the West London tower block disaster which ramped up the pressure on May.

Instead, Hammond appeared on TV on Sunday to urge a focus on business and transitional arrangements that would allow an exit “via a slope, not a cliff edge”.

The chancellor is well aware of the need to focus on the economy, with data showing average UK living standards falling and not likely return to the level of 2008 even by 2021.

All change at Dexeu

May brought in the pro-European Damian Green as first secretary of state and her number two, having been forced to jettison her two closest advisors – the Brexit-supporting Nick Timothy and Fiona Hill.

However, Brexiteers Boris Johnson (foreign secretary), David Davis (secretary of state for exiting the EU) and Liam Fox (international trade secretary) kept their roles.

‘Leave’ supporter Chris Grayling stayed on as transport secretary, and the Brexit-backing Michael Gove came back into the cabinet as environment secretary.

At the same time, the government’s Brexit department saw two of its four ministers depart this week.

The Vote Leave-supporting David Jones was sacked and replaced by the Remain supporting Joyce Anelay, apparently without Brexit secretary Davis being told in advance.

On Wednesday of last week, the minister in charge of pushing Brexit legislation through Parliament, George Bridges, quit – reportedly after falling out with May.

He was responsible for the detail of the government’s Great Repeal Bill and, according to “a Whitehall figure” quoted in the Financial Times, “quit convinced Brexit couldn’t work”.

Bridges was replaced by Tory MP Steve Baker, a prominent figure in the Vote Leave campaign and chairman of the pro-Brexit European Research Group.

The government was then forced to deny that the Department for Exiting the EU (Dexeu) was not ready for the negotiations, describing this as “nonsense”. Yet other officials in the department have also gone.

A special advisor to Davis resigned, while Davis’s parliamentary private secretary Stewart Jackson lost his seat in the general election.

The official in charge of overseeing Brexit’s impact on financial services, appointed in March, also left last week.

The departures prompted Dominic Cummings, widely acknowledged as the brains behind the Vote Leave referendum campaign, to describe Dexeu as “a total shambles” and to predict “disaster likely”.

Amid the turmoil, the Financial Times reported: “Ministers are considering options including a lengthy delay in leaving the customs union, which would remove the need for immediate new border controls and tariffs even if it would leave Britain unable to strike trade deals.

“Another option would be a Norway-style deal, with the UK remaining part of the single market but trying to negotiate an emergency mechanism to control excessive immigration.”

A PM left hanging

May’s problem is not just a hung Parliament. The election result shattered the apparent unity in the Tory party which followed the referendum.

The prime minister sought a bigger majority to be able to ignore both the ‘Remainers’ and, more important among the Tories, the virulent Eurosceptics. Now she can’t please either, but is forced to attend to both.

The unnamed head of a City financial services group told the Financial Times: “People who say the election result means the government will want a softer Brexit are assuming it is all down to what the UK decides. They are forgetting there are 27 other countries that have to agree any deal.”

The Financial Times Europe commentator Wolfgang Munchau made the same point: “Brexit, hard or soft, is not the UK’s decision alone. It is not even primarily the UK’s decision.

“The Brexit process is driven by the legal procedures of the EU . . . [and] it does not matter from a European perspective whether the UK has a minority government, a coalition or governing party with a 100-seat majority.”

His fellow columnist and senior economic commentator Martin Wolf made a similar point under the headline: “Sleepwalking towards a chaotic Brexit”.

Wolf wrote; “The likelihood that there will be no deal is now higher than before the election, since a deal depends on accepting the EU’s terms for divorce.”

‘Politicians have to deliver’

What might it mean for travel? The UK industry wants certainty, the continuation of open aviation arrangements, no new border restrictions, and continued access to labour across the EU.

Former UK Chancellor and now editor of the London Evening Standard George Osborne addressed UK travel leaders at the Institute of Travel and Tourism (ITT) conference in Sorrento last week.

By all accounts he gave a more open appraisal of the situation than might be expected. But since he spoke off the record – an odd thing for a newspaper editor to insist upon – those of us not present are none the wiser.

Osborne bears some responsibility for the mess, of course, for all that he advised former prime minister David Cameron against a referendum.

He also bears a grudge against May for terminating his political career. But his description of her (not to the ITT) as “a dead woman walking” is spot on.

Thankfully, EasyJet chief executive Carolyn McCall was more forthcoming last week, at least on what the airline industry wants from Brexit – or, more accurately, what it wants to survive Brexit.

McCall noted, with just a hint of menace: “This is in the hands of the politicians and they have to deliver – or there will be a problem on both sides.”

‎She acknowledged: “There is a lot of talk about a soft Brexit, but what does it mean? If it means a pragmatic, realistic approach to leaving the EU, that would be good for business.

“If it means recognising you need a liberal, de-regulated aviation agreement, that would be a good thing. If it means considering transitional arrangements, that would be a good thing because there is an awful lot to do.”

Speaking at an event in Toulouse to mark the handover of easyJet’s 300th Airbus aircraft and its first A320neo, McCall did not appear discouraged.

But the confidence she exuded was not borne out by the latest survey of UK business by the Institute of Directors, conducted on June 9-11 immediately after the election.

This suggested just 20% of business leaders are optimistic about the performance of the UK economy over the next 12 months and 57% pessimistic.

That minus-37 point balance contrasts with a finding of minus-3% when business leaders were asked the same question in May.

However you regard the prospects for the UK economy and for travel, spare a thought for the pollsters, caught out yet again by voters’ refusal to abide by their modelling.

The election result exposed the pre-election polls as on average skewed in favour of the Tories by 5.5 percentage points – well beyond the two point margin of error generally acknowledged as acceptable.

By contrast, polls ahead of the election in 2015 showed an average 6.5 point skew towards Labour.

That is a 12-point swing in polling error and, according to analysts, you have to go back to 1951 to find an underestimate of Labour’s vote even half the size.

It seems even data can provide no certainty at present.

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