Gary Sambrook: The Government is delivering on its promises to reform Britain’s broken immigration system

22 Oct

Gary Sambrook is the Conservative MP for Birmingham Northfield.

For many years, members of the public have repeatedly asked politicians to reform our broken immigration system and introduce an Australian-style points based one. In constituencies like mine people were tired of MPs talking tough, and delivering little change. But from January 1 we will have that new points-based system, which will be firm but fair. Today the Home Secretary has set out new measures which will introduce new tougher rules for EU citizens at the border, in line with existing rules for non-EU citizens.

This parity will send a clear message to British people that this Home Secretary means business.

When I talk to people in my constituency, which returned a Conservative MP last year for the first time in 27 years, they are concerned about crime and safety in their communities. That’s why replacing these softer EU rules with stronger border controls will make the UK a safer place and fulfil our pledge to deliver on the people’s priorities.

EU rules currently require the Home Office to demonstrate that EU criminals present a genuine, present and sufficiently serious threat affecting one of the fundamental interests of society (these include social harm, maintaining public order, and extremism) in order to restrict their free movement rights. This decision cannot be based solely on the criminal conviction, even if it was for murder or rape.

These new rules will mean:

  • Foreign criminals sentenced to at least a year in jail will be banned from entering the UK.
  • Foreign criminals sentenced to less than a year in jail could still be banned, with the Home Office considering on a case-by-case basis their full criminal history and whether they have ties to the UK such as family members.
  • Foreign criminals who haven’t received a prison sentence could also be banned from entering the UK if they have committed persistent sexual offences, or committed a crime and want to enter the UK for the first time

It is absolutely right that we take these tough measures to help keep our streets safe, reduce crime and bring trust back into the immigration system.

EU rules have forced us to allow dangerous foreign criminals, who abuse our values and threaten our way of life, onto our streets for far too long, and people have had enough.

Regardless of nationality these rules will mean the UK is safer thanks to firmer and fairer border controls where foreign criminals will be treated the same, no matter what country they originate from.

An example of where these tough new rules will help keep the UK safe. Person A is a non-resident EU citizen with a conviction for rape in 2010 where they were sentenced to eight years in prison. Today, they could be admitted to the UK because they have not offended since and it can’t be demonstrated that they currently pose a present and sufficiently serious threat to society as required under EU law. However, next year, they can be refused entry to the UK because they have had a custodial sentence of at least a year.

Or another example: Person B is a non-EU citizen with numerous convictions for low-level offending over a period of years. Under the current rules, discretion can be exercised to grant them entry, but under the new rules, as a persistent offender, they would be refused entry to from the UK.

Not only is the Government making the UK border safer and more secure, it is providing the police with more powers to protect the public in new powers granted by the Extradition Act. It gives them the power to detain international criminals without having to apply for a UK arrest warrant first.

As Parliament nears the end of its scrutiny of the Immigration Bill, it is crucial that we remember why we are introducing this new system. Last year the people of the United Kingdom gave us a clear, and substantial, mandate for change. Leaving the European Union, as many of us have made the case before, will give us an opportunity to do things differently and there is no clearer example than immigration.

The British public can be assured that this Prime Minister, and Home Secretary, get it. And are delivering on those promises.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

Stephen Booth: Why the row about the Northern Ireland Protocol suggests that the EU’s position isn’t quite as strong as it likes to think

17 Sep

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

It is often said that Brexit is low on the list of the EU’s priorities. That national capitals have not been fully engaged in a process which they have delegated to Michel Barnier and the European Commission. The introduction of the Government’s Internal Market Bill has certainly got the EU’s attention.

The events of the last two weeks have upped the ante, but the two sides continue to talk and a deal between the UK and the EU is still possible, if the political appetite is there.

As I noted in my previous column, the negotiations over a new UK-EU free trade agreement have been locked in a stalemate over fishing and state aid for weeks, and a compromise can only be unlocked by high-level political intervention.

At the same time, a parallel, and up to now seemingly boring, process has been underway to implement the Withdrawal Agreement and the Northern Ireland Protocol. It has long been clear that the UK and the EU have significant disagreements to resolve in the Joint Committee, the forum established under the Withdrawal Agreement empowered to iron out the practical details of the Protocol’s implementation.

In its May 2020 Command Paper on the subject, the UK identified its practical concerns. For example, under the Protocol, Northern Ireland is subject to the Union’s Customs Code, which requires exit summary declarations for goods leaving the area to which the rules apply.

However, the UK’s view is that export or exit summary declarations should not be required for NI to GB trade (since Article 6 of the Protocol states that nothing in the Protocol should prevent NI businesses from having “unfettered access” to the rest of the UK).

Removing this requirement should not be particularly controversial, since Northern Ireland will remain in the UK’s customs territory (as stipulated in Article 4 of the Protocol) and therefore any risk of complaints about the arrangements in terms of international obligations should rest with the UK, rather than the EU.

Another, more significant issue is the status of goods travelling from GB to NI deemed to be “at risk” of entering the EU (and therefore subject to EU tariffs). The Joint Committee is tasked with defining which goods are “at risk” and therefore broadening the scope of goods that would not be subject to tariffs. However, the default is that goods are “at risk”, unless the Joint Committee agrees otherwise.

The powers taken in the Internal Market Bill are advertised as an “insurance policy” to be used in the event of failure to address the UK’s concerns about the Protocol (which include the state aid provisions as well as exit summary declarations) via agreement within the Joint Committee and/or via a free trade agreement. There are reports that the Government plans to use the forthcoming Finance Bill to give itself similar powers with regard to tariffs.

Leaving aside the legalities and the domestic politics for a moment, why might the UK have decided to initiate a row with Brussels now and pre-empt the Joint Committee process? Of course, we cannot divine the precise motivation. Perhaps no deal is now seen as an inevitable, or at least probable, outcome by some in Government? But the logic of the negotiations offers another plausible rationale.

Implementation of the Northern Ireland Protocol and the wider free trade negotiations are theoretically on distinct tracks. While the Withdrawal Agreement committed both parties to seek to negotiate a free trade agreement in good faith, the Protocol comes into effect at the end of the transition period irrespective of any UK-EU trade agreement.

However, it is clear from the way the negotiations have been structured (at the strong insistence of Brussels) that the trade negotiation and the practical functioning of the Protocol are linked, and this gives the EU leverage over the trade negotiations. Since EU negotiators are not obliged to reach compromises in the Joint Committee on the issues causing the UK concern, they are able to hold the process up in order to apply pressure to the UK in the wider trade negotiation. Just because the EU is within its rights to do so, does not mean it should.

What the Government is doing, for better or worse, is to suggest to the EU that its leverage is not quite as strong as it would like to think. Ultimately, under the Protocol it is UK officials and agencies who will be tasked with enforcing EU rules. Realistically speaking, how plausible is it that the UK would do so zealously in a scenario where not only have the UK and the EU failed to reach a trade agreement, but the EU is also insisting on its maximalist interpretation of the Protocol?

The UK might have made this point more subtly if it had made clear that any measures it takes in the future would be strictly consistent with Article 16 of the Protocol, which allows either party to take unilaterally “appropriate safeguards” if the application of the Protocol leads to “serious economic, societal or environmental difficulties”, and its pre-existing commitments under the Good Friday Agreement.

Equally, it should also be noted that the UK is not declining to implement other important aspects of the Protocol. Indeed, as Michael Gove noted in closing Monday’s debate and Brandon Lewis repeated in committee evidence yesterday morning, the UK is erecting border-inspection posts for sanitary and phytosanitary (SPS) checks on goods entering Northern Ireland, which in an ideal world it would not have to and despite the opposition of the DUP.

Ultimately, what this row demonstrates is that a negotiated settlement on the Protocol and the wider trade issues should be preferable for both sides compared to an acrimonious breakdown in the UK-EU relationship. Indeed, the UK legislation introduced this week would be redundant if compromises can be reached.

A Protocol that is politically sustainable is in the EU’s interests. Equally, a UK-EU trade agreement would not remove all of the irritations thrown up by the Protocol but it could certainly help to smooth over some of the important issues. If there are no tariffs between the UK and the EU, there is less risk to the EU of goods entering the Single Market at a lower tariff. If the EU and UK reach agreements on SPS, like the EU has with New Zealand, then paperwork could be simplified. Equally, establishing a UK domestic subsidy regime, recognised by the EU in a free trade agreement, would help prevent the “reach back” of the state aid provisions in the Protocol that are also of concern to the UK.

Only time will tell if this episode is the beginning of the path to a deal or the point when things turned sour.

David Skelton: Brexit can unleash a new era of reindustrialisation. But only if we are free from state aid laws.

17 Sep

David Skelton is the author of Little Platoons: How a revived One Nation can empower England’s forgotten towns and redraw the political map.

Brexit provides the UK with an opportunity to build a new, high-skill, high-productivity economy. A bold agenda of reindustrialisation can revive regional economies and see the levelling-up agenda made flesh. But we can only make the most of these opportunities if we aren’t unnecessarily restricted by the EU’s state aid laws. As a sovereign nation, we should be free to follow an industrial policy that is best for Britain. We mustn’t have the ability of the British state to support innovation to be hidebound by the EU’s strict state aid rules.

There were many reasons that we voted to leave the EU. The ability to set our own laws and have them made by people who were elected and could be held accountable was a crucial part of the decision to Leave. A clear message was delivered in the referendum from long forgotten “post-industrial” towns across the country that we needed to tackle regional inequality. The EU’s apparent insistence on maintaining state aid rules after Brexit would ride roughshod over the first and make tackling regional inequality much more difficult to achieve.

I’ve long taken the view that the restrictive state aid rules imposed by the EU were one of the major obstacles to us achieving a new economic settlement that benefits the whole of the UK. The pursuit of a level playing field for the EU meant that the parts of the country that I talked about in Little Platoons, which were heavily impacted by deindustrialisation, became stuck in an economic cycle of low innovation, low skilled, low wage work.

This was bad for post-industrial parts of the country, but also bad for the economy as a whole, with the UK’s low productivity problem being particularly pronounced in those parts of the country that had seen economic decline for decades. The recycling of UK taxpayers cash (a reminder that we were a net contributor to the EU budget for decades) through much trumpeted structural funding was no substitute for the fact that state aid rules bound our hands and prevented us from a more ambitious strategy to reverse decades of decline.

Now we have left the EU, it’s essential that the EU isn’t able to bind our hands again as we look to shift the economic paradigm to that of a high-skills, high-productivity, high-wage, tech-driven economy. Freedom from EU state aid rules represents an important opportunity for us to deliver that altered economic settlement and to pursue a bold strategy that focuses on a high-tech reindustrialisation of our economy. This should emphasise the importance of manufacturing (including green industry) in reframing our economy.

Crucially, manufacturing is generally higher skill, more productive and more export driven than other sectors. Whereas manufacturing accounts for less than eight per cent of the jobs in the UK, it accounts for around two thirds of our R & D investment – the kind of investment that is crucial to future growth and prosperity. This R & D emphasis also underlines the importance of manufacturing creating what Shih and Pisano have described as the “industrial commons” – skills and knowledge networks and clusters that drive innovation further.

An industrial strategy free from the constraints of state-aid policy means that we can support the businesses and sectors that are at the forefront of the new industrial revolution and also use the power of government to create innovation hubs in the regions, along with government-supported and business-backed centres of industrial excellence. A new industrial policy, free from state-aid restrictions, could aim to deliver high innovation industrial hubs in regions where the transformative power of a government accelerated industrial commons could have an enormously positive impact.

Any discussion about the positive impact of industrial policy and the importance of a state-aid regime that supports it is normally accompanied with the construction of straw-men or, more accurately, straw “lame-ducks” and the argument that any industrial policy will inevitably go down the route of Britain in the 1970s.

This is an ideological worldview that regards the bailing out of British Leyland as trumping any international experience in the decades since.  However, what that international experience has shown is that by far the biggest risk for the UK lies in us not pursuing an intelligent industrial strategy.

International experience shows that state aid and industrial strategy can not only help to turn around lagging regions but also place countries at the forefront of emerging technologies. And successful international experience illustrates that an ambitious industrial strategy shouldn’t be about “bucking the market”, but, instead working with the market and using market signals to maximise the impact of government investment.

In many parts of Asia, including Korea, Japan, Taiwan and Singapore, industrial strategy has used market feedback to develop a sectoral industrial strategy that has seen living standards and productivity surge. In all cases, the feedback mechanism of the market has allowed governments to identify sectors for future growth and provide government investment that has allowed these countries to be leaders in key sectors.

The mid-century United States, seen wrongly as a laissez-faire bastion, also provides an example of gains that can be made when business and government work together. The hero of that story is Vannevar Bush, who saw the importance of the government strongly investing in and incubating innovation and helping to transfer ideas from the initial invention to the marketplace.

His importance has been summed up recently in the excellent work of Safi Bahcall. Bush understood that innovation and invention is key to future growth and prosperity, but also that early innovation is fragile and risky. Without government support, such innovation might well perish, but government support, through the likes of the National Science Foundation and DARPA allowed innovation to be nurtured at a crucial stage and resulted in a stream of inventions that transformed the economy.

Such a model, in which government nurtures innovation at the most important stage and invests in those companies at the cutting edge of key emerging technologies could be transformational for the UK economy, which already has a world-leading research base but often lacks the ability (or often means due to distorted or inefficient funding models) to maximise the commercialisation of innovation.

Government is in a position to support innovation at the most fragile stage of the innovation process in a way that the market simply cannot. An effective industrial strategy could maximise the UK’s strengths and use the directional sway of government to promote long-term growth outside of the South East. Such an ambitious policy would not, however, be fully possible under the stricture of EU state aid rules.

Brexit represents a remarkable opportunity for an economic renaissance in the UK. We no longer have to have ambition or imagination restricted by the EU’s state aid rules.

This renaissance could place the UK at the vanguard of the most industries and technologies over the coming decades. It could also bring about a lasting and meaningful transformation of parts of the country that have long been characterised by economic decline. This requires a sensible and strategic role for government, based on an independent economic policy that isn’t limited by the narrowly restrictive nature of EU state aid limits.