Ian McConnell: Conservatives’ attitude to the EU is ever more aggravating

In this column in recent weeks, it has been argued at length that the talks between the UK and EU on the post-Brexit future must be put on hold amid the coronavirus pandemic.

Amid the Covid-19 tragedy, the focus is, and must be, on saving lives.

The UK Government and its counterparts across Europe, and around the world, are facing huge challenges as they fight this pandemic.

Further massive challenges lie ahead in terms of trying at the right times to reboot economies, and thus minimise the ultimate damage to living standards and longer-term health.

The UK Government has thrown tens of billions of pounds at supporting incomes of furloughed workers and the self-employed in an attempt to minimise the economic damage.

Stability will be key in coming months. The UK is thankfully fortunate enough to still be in the European single market, having implemented in reality a largely technical Brexit on January 31. Crucially, the UK’s economy, citizens and businesses remain cushioned from the big effects of Brexit by the transition period that runs until the end of this year.

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Prime Minister Boris Johnson of course made a great deal, in the run-up to the December General Election, about how he would not extend the transition period. And the Conservative Government subsequently legislated to this effect. It remains difficult to see why it was so seemingly keen to box itself into a corner. Whatever the reason, though, all of this was before the coronavirus crisis.

And, if ever there was a time to re-think such arbitrary positions, it is now, with the pandemic having created a world that few if any could have envisaged at the end of last year, when Mr Johnson was banging the drum about leaving the single market.

In recent weeks, the scale of the economic dislocation that has accompanied the coronavirus tragedy has become ever clearer for all to see. It is a backdrop that calls for taking control of what you can, to enable a focus on the developing coronavirus pandemic and its aftermath. Extending the transition period beyond December 31 looks like such an obvious early step and, if it were not for the lack of flexibility over Brexit in recent years from the Conservatives, it would be difficult to conceive of this sensible decision not being taken in short order.

However, Mr Johnson’s return to work this week seems to have coincided with a further hardening of the tone from the UK side.

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There has been a signal from Downing Street this week about the EU, in the eyes of the Conservative Government, not recognising the UK enough as an “independent state”. This points to a continuing preoccupation with ideology rather than the economic good in the ongoing Brexit folly, even amid the coronavirus crisis, and this does not bode well. Of course, the UK was in any case an independent state when it was part of the EU, and remains so in the single market during the transition period, so the semantics from the Government remain most difficult to fathom.

Addressing MPs on the Committee on the Future Relationship with the European Union on Monday, Minister for the Cabinet Office Mr Gove emphasised that the suffering caused by the Covid-19 virus was “in the forefront of all our minds” and paid tribute to health service workers.

However, asked whether it was still right to work to the deadlines that existed before the coronavirus crisis, Mr Gove told MPs this week: “We believe it is still entirely possible to conclude negotiations on the timetable that has been outlined.”

And he said he thought the Covid-19 coronavirus crisis should “concentrate the minds of EU negotiators”, reinforcing “the vital importance of coming to a conclusion”.

However, the collective minds of national governments throughout Europe and across the world, including the UK, and of the EU and its institutions, are rightly concentrated on dealing with the coronavirus tragedy. And there is nothing vitally important about concluding talks to enable a December 31 single-market exit for the UK, given the transition period can simply be extended.

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And the last thing households and businesses need, amid huge uncertainties created by the coronavirus crisis, is further turmoil related to the Tories’ seemingly unbending desire to take the UK out of the European single market at the year-end.

Households and businesses are, understandably, craving any and all possible stability as they try to weigh up the outlook for the economy, jobs and living standards. People remain rightly focused on the health and well-being of family, friends, colleagues and neighbours. This is the case in countries around the world.

The UK, sadly, faces the additional uncertainty created by the Conservatives’ Brexit folly. This is currently overshadowed by the frightening uncertainties created on so many fronts by the coronavirus pandemic. However, the uncertainties over the UK’s future relationship with the EU will, unless the Conservatives take the sensible course of action by extending the transition period for the maximum two years, make a grim situation worse. We should not underestimate the impact of a no-deal departure from the single market on the UK economy. An economy that is likely to need all the help it can get amid the coronavirus crisis.

Yet the Conservative Government, which claims it wants a comprehensive free-trade agreement with the EU, continues to stick stubbornly to its guns on its timetable for European separation.

Of course, it is worth remembering that a no-deal departure does not in any case seem to pose the same worry to Mr Gove as it does to millions of households and many thousands of businesses the length and breadth of the UK.

Back in the summer of last year, Mr Gove was talking about how the UK Government “must operate on the assumption” the UK would leave the EU without a deal. This triggered a tumble in the pound and, at that time, Mr Johnson appeared to distance himself from Mr Gove’s comments. The Prime Minister declared that his assumption was the UK Government “can get a new deal”.

In the intervening period, a post-Brexit deal appears to have become ever less likely. And that is saying something.

Last Friday, at the end of a week of negotiations between the UK and EU conducted through video-conferencing, Michel Barnier, the EU’s chief negotiator, said the aim of tangible progress had only been “very partially met” and declared the “UK did not wish to commit seriously on a number of fundamental points”.

He observed that “more than ever the clock is ticking” and that the UK was, in terms of its rejection of any extension to the transition period, imposing a very short timetable for negotiations and at the same time not moving on matters that are important to the EU.

The challenges of securing a trade deal with the EU within the timescale set out looked huge even before the coronavirus crisis hit and comments on Monday from Mr Johnson’s spokesman appear to really underline these difficulties.

The spokesman said: “We are ready to keep talking but that does not make us any more likely to agree the EU’s proposals in areas where they are not taking into account the UK’s status as an independent state.”

Sadly, this reinforces the impression that the debate continues to focus on ideology and nationalism, rather than on the economy and living standards.

The continuing differences between the UK and EU will only fuel fears that Britain continues to hurtle towards a no-deal Brexit. This is the last thing households or business leaders in the UK need. And, if senior members of the Conservative Government were able to put their ideology aside for a moment, it might even occur to them that this is the last thing they need as they fight the coronavirus pandemic and endeavour to deal with its consequences.

Forecasts drawn up by the Theresa May government show major damage from leaving the European single market, even with a comprehensive trade deal.

The country would obviously, even with a trade deal, lose the huge economic benefits of free movement of people between the UK and EU, and this will take its toll over years and decades.

And, even with a deal, the UK will lose the benefits of truly frictionless trade.

Of course, a meaningful deal looks unlikely on the timeframe set out.

Business leaders are already focused on, and will remain absorbed with, how to deal with the coronavirus crisis and its consequences. This will be very challenging, and involve much detailed planning. The last thing they need is the additional burden of putting in place contingency measures to cope with a no-deal departure from the single market.

And, from the viewpoint of the UK population at large, surely the Government could be good enough to stop another blow to people’s living standards in the form of a departure, under any scenario, from the European single market on December 31?

What comes after Brexit in terms of the future relationship with the EU is something that should be put off for another day – when the UK is perhaps able to take stock and reflect on its priorities – by extending the transition period. The world has changed and the coronavirus tragedy has underlined the importance of the UK working together with its European neighbours.