It is increasingly apparent even to the right-wing press that Brexit isn’t working. It is difficult to see how Labour’s mission to “make Brexit work” could provide more than a very partial solution to the problems created by the Conservative government’s implementation of a hard Brexit. But recent data show that, contrary to received wisdom, a policy of reinstating freedom of movement and rejoining the EU single market could pay dividends.
Brexit is damaging
Brexit has inflicted serious damage on the UK economy. A recent (June 2022) report from the Centre for European Reform has estimated that UK GDP is 5.2% smaller than it would otherwise have been, investment is 13.7% lower, and goods trade 13.6% lower. The LSE Centre for Economic Performance estimated in 2020 that the eventual cost of Brexit to the UK economy is likely to be more than double that of the Covid pandemic, a view shared by the chair of the Office for Budgetary Responsibility.
The Resolution Foundation has estimated that Brexit will cost each UK worker £470 every year over the coming decade. And the Office for National Statistics has reported the worst balance of trade figures since records began.
This is before taking into account the cost of living crisis and the destructive effects on the UK economy of policies advanced by the Truss and Sunak governments. And without including full implementation of the trade and cooperation agreement, which the minister for Brexit opportunities said would be an act of national self-harm.
The impact of Brexit is felt particularly severely in Wales, which prior to Brexit exported more to the EU (61%) than did the rest of the UK (48%). As a consequence, the Welsh Centre for Public Policy has estimated a £1.1bn hit to Welsh exports, with a particular impact on machinery exports owing to ‘rules of origin’ requirements, and a 30% decrease in traffic through the Welsh ports of Fishguard and Holyhead.
Small businesses in sectors such as agriculture and tourism have been hit by the failure of the UK Government to honour its promise to match the loss of EU funding, at a cost estimated by the Welsh Government to amount to a further £1.1bn. As recently as September 2019, the Welsh Government argued strongly that the UK should remain within the EU, in order to safeguard not only the economy, but also social and environmental protections and the devolution settlement, all of which are at now at risk.
The damage caused by Brexit is widely recognised: opinion polls on the question of whether Brexit is going well or badly have shown a steady deterioration in public support, with well over three times as many now thinking that Brexit is going badly than think it is going well (54% to 16%). There is now a consistent majority (around 55% of those expressing a view) saying that Brexit was a mistake. The veteran pollster Peter Kellner has concluded that: “Given how slowly public opinion has changed, this looks like a verdict that is as settled as anything ever is in politics. Britain is no longer a pro-Brexit country.”
Can Brexit be made to work?
The failure of Brexit is particularly salient to Labour supporters, over 80% of whom think Brexit is going badly compared to only 3% who see it as succeeding. In response, the Labour Party has adopted a policy of “making Brexit work”. Can this be done?
Certainly, there are some steps that that could be taken to improve the situation. But in setting out his proposals, summarized in Table 1, Keir Starmer acknowledged that “outside of the Single Market and a Customs Union we will not be able to deliver complete frictionless trade with the EU”.
After a Labour government has implemented these changes, there will still be long queues at the border and a massive hit to the economy and family budgets. There will also remain costs and lost opportunities for UK citizens, such as the 90-day limit on Schengen visits, separation of families, means tests, and visa and roaming charges, to name but a few. The only way to close these gaps outside the Single Market and Customs Union would be to create a multitude of separate treaty arrangements, comparable to those negotiated by Switzerland, which the EU have stated unequivocally would not be acceptable.
|Labour Party||European Movement|
|a new veterinary agreement for agri-product trade||negotiate common veterinary arrangements|
|a system for low-risk goods to enter Northern Ireland without checks||sort out trade with Northern Ireland|
|“flexible labour mobility arrangements” for people making short-term business trips between the UK and EU, and for musicians and artists embarking on tours||visas for lorry drivers and other essential workers|
|mutual recognition of professional qualifications with the EU and a new policing and security arrangement with Brussels||re-join the Erasmus study programme for universities|
Alongside the Labour proposals, Table 1 also lists very similar proposals from the European Movement. But after plucking these low-hanging fruit, the two sets of proposals diverge. The European Movement plans represent only a first step, to be followed by rejoining the EU Single Market and Customs Union. But Labour has ruled out Single Market and Customs Union membership. Why?
A striking feature of the reluctance of the Labour Party to campaign for single market membership is the conspicuous absence of a plausible explanation as to why such a simple and powerful solution is being rejected. But a reason is apparent from a steady stream of rhetoric over the past six years that has coalesced into a settled dogma: single market membership would mean the return of freedom of movement which, it is believed, would so anger leave voters that they would withdraw support from a party advocating it. But new data show that this assumption is incorrect.
Freedom of movement is NOT toxic to leavers
We conducted a large (>2K), nationally representative survey, asking participants how acceptable they would find five scenarios for the future of the Brexit process. Participants were identified as leavers, remainers, or neither from their responses to a short questionnaire, with three leave-supporting and three remain-supporting items (e.g. ‘I identify strongly with people who voted to leave/remain in the European Union’).
Alongside hard Brexit and second referendum options, we included three visions of ‘A new deal with Europe’, involving either free trade, freedom of movement, or both. Each scenario was presented with a detailed explanation, and a rationale. In Figure 1, the acceptability of each scenario is broken down according to participants’ Brexit identities. Unsurprisingly, the hard Brexit option (‘An Independent Sovereign UK’) was unacceptable to remainers (Figure 1A), while the idea of a second referendum (‘Rethink Brexit’) was unacceptable to leavers (Figure 1B).
However, the three ‘new deal’ options were all similarly attractive to leavers as to remainers (Figure 1 C,D,E). For both groups, each of free trade, freedom of movement, and the combination of both elements was acceptable to more than 50% of participants and unacceptable to less than 20%. Participants who did not express a Brexit identity also reported very low (10%) levels of unacceptability for all of the ‘new deal’ options.
These data suggest strongly that the conventional wisdom is mistaken. When the meaning is spelled out, freedom of movement is not toxic to leavers, who are almost as positive about it as remainers. Moreover, almost identical levels of support were found for the third ‘new deal’ option which envisages both free trade and freedom of movement – a close approximation to single market membership.
Freedom of movement and single market membership could be vote winners
Opposition to freedom of movement and single market membership are policies that risk alienating millions of remainers and appear to be equally unpopular with leavers. Reviewing recent polling data, Peter Kellner points out that Labour polls at its worst, at 14% (well below the Conservatives), on “Which party would handle Brexit best?”, and argues that “Labour’s ultra-cautious stance on the EU isn’t working … Labour has irritated many pro-Europeans while failing to persuade more than a small minority of pro-Brexit voters that it knows the right way forward. … If Brexit (starts) to matter as the campaign unfolds, then Labour’s manifest weakness on the subject might cost it dearly.”
The LibDems have agreed on a roadmap to rejoining the single market, a policy that is also supported by Plaid Cymru. But Keir Starmer stated in his ‘make Brexit work’ speech that a Labour government would not seek to reintroduce freedom of movement or rejoin the single market because this would not “help stimulate growth or bring down food prices or help British business thrive in the modern world”.
Since single market membership would almost certainly stimulate growth, reduce food prices, and reinvigorate British business, these are questionable grounds to rule out policies that – according to our data – could command wide support across the Brexit divide.