Oliver Norgrove is a spokesman for EFTA4UK, a non-partisan campaign group. He is a journalism graduate, former civil servant, and blogger, who worked on communications for Vote Leave during the referendum campaign.
If she were alive today, what advice might Mrs Thatcher be privately sharing with her successor on the issue of Brexit?
While the UK’s first female Prime Minister is no longer with us, we don’t need to speculate on this matter, as she clearly stated her views in her final book, Statecraft: Strategies for a Changing World:
“There are…useful precedents. In 1992, Norway, Iceland and Liechtenstein – concluded negotiations with the EU which established a European Economic Area (EEA). These countries now enjoy free trade with the European Union; that is the freedoms of movement of goods, services, of people and of capital. They also enjoy the unhindered access guaranteed by the operation of the European Single Market.
But they remain outside the customs union, the CAP, the CFP, the common foreign and security policy and the rest of the legal/bureaucratic tangle of EU institutions. But Britain is in a different league from countries like Norway (population 4.4 million) or Iceland (population 270,000), let alone Liechtenstein (population thirty-two thousand.) We could press for Britain to be represented in the drawing up of all Single Market Legislation.”
She went on to write:
“Switzerland is unique in many ways. But whatever Switzerland has secured in its dealings with Europe, Britain too could certainly obtain without great difficulty. Switzerland enjoys free trade with the EU. The EFTA model is perhaps not ideal: but it is certainly an acceptable option.”
There is no doubt then, that Thatcher would be urging the UK to apply to rejoin the European Free Trade Association (EFTA), which the UK helped to establish in 1960.
The EFTA states are not subject to the EU’s Common Agriculture and Fisheries Policies, the Customs Union, the Common Trade Policy, the Common Foreign and Security Policy, the Justice and Home Affairs policies, or European Monetary Union.
In addition, they speak freely for themselves at the World Trade Organisation and other global ‘top tables’, something the UK cannot do as a member of the EU. Finally, they are not subject to the European Court of Justice, but rather to the separate EFTA court.
According to Professor Carl Baudenbacher, the President of the EFTA court:
“Our setup [the EFTA court] is more sovereignty friendly than the EU’s. There is no written obligation on any court of last resort to make a reference to us, and our rulings in these reference cases are strictly speaking advisory. There is no direct effect and no primacy of EEA law, and if you do not implement an infringement judgment there is no possibility to impose a penalty payment. That shows greater flexibility.”
The Scottish and Welsh governments have expressed strong support for a smart, EFTA-style, Brexit. If the Prime Minister also endorsed this approach, it would be a strong signal to the devolved administrations that their ideas and wishes were being taken on board.
It would be possible for the UK to have a more regulated, ‘managed’ form of freedom of movement with the EU, with additional checks and balances within EFTA – as EFTA4UK has outlined.
The EFTA countries enjoy unparalleled access to EU goods and services markets. In addition, the EFTA States have 27 free trade agreements, covering 38 countries including Canada, and are close to signing an FTA with India.
Unlike the EU, EFTA has a unique ‘two-track’ trade deal system. EFTA’s negotiators work to negotiate trade deals for the bloc as a whole, while allowing member states to negotiate their own bespoke trade deals. An example of this is that all of EFTA has a trade deal with Hong Kong, but EFTA member Switzerland has a separate trade deal with China.
EFTA has many experienced trade experts and negotiators on the payroll, while the UK is now currently scrambling to recruit sufficient personnel. Britain could become part of the EFTA trade network and still sign her own separate deals when we have re-established the necessary negotiating teams; a win-win situation for the UK.
The UK can continue to co-operate with the EU member states in the fight against crime and terrorism via Interpol and the UN Office on Drugs and Crime. The current EFTA states have also signed operational agreements with Europol to deepen their co-operation in this area.
The EFTA approach would provide for a smooth and orderly Brexit. In addition, the UK would likely make substantial savings as an EFTA member compared to EU membership costs. As a report by the House of Commons Library stated:
“If the UK left the EU and instead contributed to the EU budget on the same basis as Norway, its contributions would fall by around 17 per cent. EEA countries and Switzerland contribute to the costs of EU programmes in which they participate, and to programmes to reduce economic and social disparities within the Union. Norway, an EEA country, contributed around £106 per capita in 2011, while Switzerland contributes around £53 per capita. These figures are respectively 17 per cent and 60 per cent less than the UK’s per capita contribution of £128 in 2011.”
Michel Barnier, the EU’s negotiator, said only this week:
“Norway, Iceland and Liechtenstein have chosen to be part of the Single Market, to accept their rules, and who make a financial contribution to European cohesion. But I also think of Canada with who we’ve just negotiated a highly ambitious free trade agreement. Canada is not part of the Single Market and therefore has neither the opportunities nor the obligations. I’m sure everyone understands it will not be possible for a third country to combine simultaneously the benefits of the Norwegian model with the weak constraints of the Canadian model.”
He couldn’t be clearer: we can either have full Single Market access via participation in the EEA via EFTA, or we can attempt to get a Free Trade Agreement which would be suboptimal for UK citizens, financial services providers, importers and exporters.
The UK no longer has the time left to negotiate an entirely bespoke agreement with the EU that will entirely satisfy all of the aims the Prime Minister has previously set out.
In addition, she faces significant opposition in both the Commons and Lords. For these reasons, and the reasons we outlined above, the Prime Minister should issue a formal request to rejoin EFTA and call for the opposition to back her, to make a success of Brexit.