David Gauke is a former Lord Chancellor and Justice Secretary.
November 2020. An all-day Cabinet Meeting had concluded. The decision had been reached and an anxious Prime Minister was preparing to address the nation from the Downing Street lectern. The meeting could have gone worse – only three resignations – but there was no concealing the fact that the Prime Minister and the Government were in a tight spot. The honeymoon had finally come to an end.
Prime Minister Boris Johnson had had a good few months. He was the first leader of the Conservative Party since Margaret Thatcher to win a comfortable majority last December. Even though he had lost a few seats in London and the Home Counties (one particularly eye-catching shock in Hertfordshire), the fear of Corbyn and a desire to ‘get Brexit done’ had been enough to breach the red wall and return a majority of over 30.
His Withdrawal Agreement Bill had been rushed through Parliament and, on 31 January, the UK finally left the European Union. It was a moment of great historical significancem even if the moment itself was much of an anti-climax. After all, the terms of the implementation period meant that nothing very much changed on 1 February.
Labour and the Liberal Democrats, although receiving a majority of the votes between them in last year’s general election, had entered into a period of introspection. A few elder statesmen warned of the consequences of leaving the EU on the terms agreed, but no one was listening. After all, the people had spoken in both a referendum and a general election. Who cared what a few out of touch Jeremiahs had to say?
That spring, the economy continued to drift on comfortably enough. It is true that the oft-promised tidal wave of investment that was supposed to flood the country did not materialise (after all, investors wanted to know about the future relationship), but many businesses remained sanguine that, now that Brexit had been delivered, the Prime Minister would pivot to finding a sensible accommodation with the EU.
The Prime Minister had said that he would get a comprehensive free trade agreement before the Implementation Period expired, but would not extend the Implementation Period beyond 31 December 2020. There was more than a little scepticism about this position and some confidence that these were pledges not to be taken literally.
At least, that was the position until the political excitements of May. Alarmed at the lack of progress towards reaching a free trade agreement, sources close to Sajid Javid had suggested to The Times that ‘EU intransigence’ meant that it may be necessary to extend the Implementation Period by 12 months.
The reaction soon put paid to that idea. Within hours, a letter of objection had been submitted by 25 newly elected Conservative MPs – all of whom had become members of the ERG – pointing out that they had won their seats on the basis of ‘getting Brexit done’ and that ‘extending vassalage wasn’t getting Brexit done’. Senior Cabinet Ministers briefed that they would resign rather than allow the Implementation Period to be extended. Lord Farage threatened to form a new party.
By the end of the day, the Chancellor had made it abundantly clear that he was resolutely opposed to any extension of the Implementation Period and that he had not authorised any briefing to the contrary. The pound fell.
Progress towards a trade deal remained slow throughout the summer. The UK said that a deal should be easy because the parties began the process aligned on a large range of matters. The EU pointed out this was all very well if the intention was for both parties to remain aligned. An agreement could be quickly agreed if the UK accepted ‘dynamic alignment with EU regulations’. The Prime Minister said that this didn’t constitute Brexit.
The EU also offered a ‘barebones’ deal, but it required all sorts of concessions from the UK that appeared politically impossible. The French made some threatening noises about fish; Scottish Conservatives MP (who had happily seen off the SNP last year) demanded that our fishermen should not be betrayed; the Prime Minister deployed the Royal Navy, the practical purposes for which were not entirely clear.
Meanwhile, discussions with the US about a free trade deal had run into the ground. The Prime Minister won much praise for robustly dismissing demands from the US for acceptance of their food standards and increased drug prices. Donald Trump said that the Prime Minister had been ‘very, very mean’ and withdrew an invitation to the Prime Minister to visit Washington. None of this did the Prime Minister any harm with the public, although he was forced to admit that no progress was going to be made in reaching an FTA with the US until after the Presidential election.
The Opposition made a push towards extending the Implementation Period in June but Johnson saw off all Parliamentary manoeuvres with ease. He had the numbers. And he remained confident that a trade deal was in sight. The markets were not so sure. The pound fell.
Party conference was a triumph. It is true that the economy seemed to show signs of slowing as uncertainty grew. Clearly, Brexit had not been entirely ‘done’ but the Prime Minister delivered a barnstorming speech attacking the European Union for being cumbersome and bureaucratic, and that its delays in signing up to an agreement just demonstrated how right we were to escape the clutches of this sclerotic entity. The audience loved it. And the pound fell.
Post-conference, the mood began to change. Inflation picked up as the consequences of the depreciation in sterling worked its way through the system. Living standards were starting to fall; business investment was now falling fast.
Much of the country blamed the EU for the failure to reach an agreement. But much of the country did not. ‘Get Brexit done’ was now a phrase only used ironically.
A clip of the Prime Minister being harangued by an angry first-time Conservative voter from Wakefield went viral. “You promised us you’d get Brexit done but all we hear about is Brexit”, Johnson was told. “Why should I ever trust you Tories again?” To be fair, it was the only interrogation the Prime Minister had received for some weeks after he had declined broadcast interviews for weeks.
Not long afterwards, the deadlock in the EU negotiations was broken. The UK had been curiously reluctant to set out its positive demands for an FTA and it was left to the EU to take the initiative. It brought back the proposal was a ‘barebones’ agreement. It addressed tariffs and quotas which mattered to the EU.
But it did nothing for services, left the UK as rule takers in a host of areas and, when it came to fish, required that the demands of the French and others were accepted in full.
‘What else are you going to do?, the Prime Minister was asked after a testy exchange with the President of the European Commission. ‘You have weeks left before the Implementation Period comes to an end. This is the deal. Sign it or Great Britain leaves on WTO terms.’
That takes us to our emergency Cabinet meeting. So what does the Prime Minister do? Agree to a deal that, on any fair assessment, gives the EU all that it wants but fails to deliver any of the UK’s negotiating objectives. Or leave on WTO terms having, one year previously, acceded to the EU’s objectives on the divorce payment, citizens’ rights and Northern Ireland.
Two very bad options. The Treasury advises that the economic hit of both choices will be considerable but that, in this case, a bad deal will be better than no deal. Politically, the Prime Minister ponders whether he could sell such a deal as a triumph. It evidently isn’t a triumph, but that hasn’t always stopped him in the past.
Either way, the honeymoon is properly over. A general election may have been won on promises to put Brexit behind us and move on, that getting a comprehensive free trade agreement would be easily achieved and that our post-Brexit future would be filled with opportunities to trade with the rest of the world. A year later, those promises collide with reality. There is a price to be paid.