26 February 2019

EPC: Extending Article 50: One step too far for the EU?

The closer the UK gets to Brexit day the more likely it will be that an extension of the Article 50 period will be required to avoid a chaotic no-deal outcome. But despite the cost of this worst-case scenario, it is far from clear whether a substantive extension is in the EU27’s best interest.

Even if the prime minister is forced to ask for an extension, it is not a foregone conclusion that the EU side will readily agree to any option: it all depends on the length of and reason for an extension. While the EU27 would not outright reject a UK request for an extension of Article 50, not least because they would not want to be considered responsible for any chaos following a no-deal exit at the end of March, a longer political extension beyond the date of the European Parliament (EP) elections (23-26 May) would be risky for the EU for several reasons.

First, it would mean that the UK would almost certainly have to participate in the European elections. This would affect the configuration of the European Parliament as, conditional on Brexit, 27 of the UK’s 73 seats have been redistributed to other member states (the remaining 46 seats are held in reserve for future enlargements). If the UK were to participate, one option would be for these member states to give up their claim, which might be technically difficult as it would require changing domestic election laws and politically contentious if the UK still leaves after a few months. Another option might be to increase the size of the EP by adding the UK’s 73 seats to the new allocation, but that exceeds the maximum number allowed by the treaties, which means the treaties would have to be changed.

Letting the UK participate could also lead to a further increase in Eurosceptic MEPs, with adverse consequences for the balance of power in the EP and even more negative repercussions in the UK political system. If Brexit is delayed substantively, Leave supporters would worry about the UK not leaving after all, and are likely to see this as a betrayal of democracy. Remainers’ hope of reversing Brexit could be rekindled. As a consequence, both sides could effectively turn the European elections into a quasi-referendum on the UK’s relationship with the EU. At the same time, those with moderate views on a range of topics, not necessarily focused on Brexit, would find it difficult to vote for either of the big parties. The result would probably be an increase in support for hardline Eurosceptics and for a people’s vote, while the big parties would struggle, making finding a resolution to the UK’s conundrum even more difficult.

Second, extending Article 50 up to or into the next EU Multiannual Financial Framework (MFF) for 2021-2027 would require new budget contributions from the UK, which would be highly contentious domestically. If London ultimately agreed to make contributions, it would be very tempted to make these conditional on a Brexit deal. This would be unacceptable to the EU.

Third, granting a long extension would remove the EU’s, as well as Theresa May’s, leverage to push for a deal now. The Withdrawal Agreement has the best chance of getting through the UK Parliament if MPs face a binary choice, staring down the cliff edge: the deal, or a chaotic no-deal exit. Removing the immediate threat of no deal would mean giving up this leverage.

Fourth, and related to the previous point, it would make the EU look desperate to avoid no deal. This would be a gift to Brexiteers. From a game theoretical perspective, the Brexit negotiations are a game of chicken, with both sides trying to convince the other that they are not willing to back down. Granting a 21-month extension would be seen as a signal of weakness on the part of the EU and it would cost Brussels leverage and credibility in future negotiations with the UK.

Fifth, extending Article 50 would change nothing about the fundamental options available to the UK. While some argue that there might be a greater momentum for a people’s vote, there is nothing stopping Westminster from backing a 2nd referendum now. The reality is that the numbers are not there. A substantive extension is likely to merely delay painful but inevitable decisions, with only a very small chance of a reversal of the Brexit decision. Businesses would still be in limbo and see any plans they have already made for Brexit disrupted, most probably for no better outcome.

Postponing the inevitable

For these reasons, the EU27 are unlikely to grant the UK more than a single technical extension of several weeks, up to the European elections. UK media reports quoting unnamed EU officials that suggest that one option under consideration is to replace the transition period with a 21-month extension of Article 50 could potentially be an attempt to influence the UK debate rather than a real offer on the table.

But if a longer, political extension is being considered in earnest, it is important that the EU27 accept the full consequences: a loss of leverage, and fuel to the Brexiteers’ argument that there is no real cliff edge; a toxic EP election campaign in the UK with further political fragmentation; the re-opening of Article 50 discussions on issues such as the UK’s financial contributions and the backstop. It might even increase the probability of a no deal if the intense pressure of a hard deadline is taken away. Given the very small chance of Brexit being permanently reversed, is it all worth it?

Full article on EPC

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