Lord Frost was not only an effective negotiator but also one
of the few UK ministers to fully grasp the intellectual case for Brexit.
His resignation looks to have resulted, at least in part, from the UK
government backsliding on the Northern Ireland protocol and failing to
take bold moves in areas like regulation to realise the potential
benefits of Brexit. There is now a real danger the UK will drift into a
damaging position of de facto alignment with the EU across a range of
areas.
Make no mistake – the resignation of Lord Frost as UK Brexit
minister is a massive blow for Brexit supporters and a huge victory for
the EU and for UK Remainers and crypto-Remainers. It represents a major
risk to the achievement of a genuine and enduring Brexit.
Frost proved himself an effective negotiator, as the near-universal
dislike he provoked in Brussels showed. But perhaps more importantly, he
was perhaps the only UK cabinet minister to fully grasp the
intellectual case for Brexit and how Brexit needed to be implemented for
it to work. His loss leaves a massive gap that is most unlikely to be
filled by his replacements.
Although the reason for Frost’s departure has been officially claimed
as covid restrictions, it seems very likely that the real cause was
Brexit-related. The main issue is the Northern Ireland protocol. In the
months leading up to last November, Frost had repeatedly warned the EU
that he was prepared to use Article 16 of the protocol to suspend some
of the provisions damaging the Northern Irish economy, if the EU did not
agree to changes via negotiations.
But from November, the UK government line softened and negotiations
were allowed to drag on, fruitlessly. The EU had called the UK
government’s bluff and the government had caved in. Worse still, Frost’s
negotiating position was publicly undermined by a series of ‘briefings’
by UK officials that suggested the UK was no longer pursuing key aims
such as ending the role of the European Court of Justice (ECJ) in
Northern Ireland.
The second, linked, issue has been raised
by Frost himself – the failure of the UK to take advantage of the
economic freedoms offered by Brexit. From an economic perspective, the
potential benefits of Brexit are largely about doing things differently
and better, especially in the areas of trade and regulation. But the UK
has moved very slowly in both areas.
It is true that a trade agreement has now been signed with Australia,
and another in principle agreed with New Zealand. But at the same time,
the government has presided over the creation of a trade and
agriculture commission stuffed with protectionists and EU supporters
which may dilute the benefits of these deals and prevent new ones.
More importantly, changes to regulation have been minimal. This is
where the really big gains from Brexit are likely to be found – there
are big upsides to be had from removing the most damaging EU regulations
in industries like financial services. Yet almost nothing of note has
been done here. Various bodies have been set up to study possible
changes in regulation, in a classic bureaucratic delaying tactic, but
there are few signs that their suggestions will be acted on. Instead,
the government has tried to fob Brexiteers off with trivial suggestions
such as bringing back pint bottles of Champagne – spin over substance.
On top of this, the government has also taken the baffling step of
raising taxation to a decades-high level even before the UK has fully
emerged from the covid downturn, has done nothing in the desperately
urgent area of tax reform, and has proposed a raft of eye-wateringly
expensive green policies. So structural or supply-side policy more
generally has gone in precisely the wrong direction. The prospect of the
current policy direction leading to a dynamic post-Brexit economy over
the long run looks remote.
There could be even worse to come. Frost’s departure opens the door
to the UK caving in to various Remainer lobbies on a variety of fronts
and drifting back into alignment with the EU in a range of areas –
doubtless all done in the name of ‘pragmatism’.
The first of these will be Northern Ireland. The government has
already signalled a climbdown on the role of the ECJ, indicating its
willingness to accept a model of dispute resolution similar to that
previously proposed by the May government and used in the EU’s agreement
with Ukraine – basically a one-sided vassal state position where the
ECJ will take all the important decisions behind the scenes, as Martin
Howe has set out.
Briefings for Britain
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