Robert Halfon is MP for Harlow, a former Conservative Party Deputy Chairman, Chair of the Education Select Committee and President of Conservative Workers and Trade Unionists.
In a question to the Prime Minister last week at PMQs, I asked:
“I do have respect for the Prime Minister, and I understand her position. However, over the past few years, we have had very difficult cutbacks to local services in constituencies such as mine – in Harlow – and across the country, and every time we make the case that it is a difficult economy and we do not have enough money. How do I explain to my constituents that we have £39 billion to get out from the Treasury sofa to give to the European Union when it is questionable whether we owe all that money? Does she not agree that this is not just about the European Union – it is a matter of social justice?”
In our communities, the difficult economic situation has hit our local services, our neighbourhood groups, charities and policing – amongst other things. And yet, when push comes to shove, the Government seems willing to hand over £39 billion from scarce monetary resources.
This hefty financial settlement means that Brexit has no longer stolen only the limelight of Government business, pushing domestic policy issues down the pecking order, but is now robbing from the pay packets of hardworking taxpayers who want to see a better return on their investment at home.
And what’s worse, according to legal experts, the basis of this hand-out is questionable at law. The EU argues that we have a financial obligation to pay the £39 billion. But is this really the case? The House of Lords European Union Committee suggests otherwise. Lawyers for Britain’s analysis even goes as far as to conclude that we are owed £10 billion!
The wording of Article 50 is clear: upon leaving the EU, “the treaties shall cease to apply to the state in question”, be that by way of the Withdrawal Agreement or, in the event of a No Deal – either way, on the 29 March next year.
As legal professionals and scholars note in the Lords’ report, the hierarchical structure of EU legislation entails that once treaties cease to apply to the UK, so too do all EU legal obligations found in subordinate legislation, including the UK’s current and future financial obligations under the Own Resources Decision, the Multiannual Financial Framework and the annual budget. Lawyers for Britain scrutinise the EU’s approach: the EU is inevitably bargaining for the most expensive divorce bill it can get its hands on, and attempting to secure contributions for two years after withdrawal.
Furthermore, the Lords’ Committee report shows that any attempt to enforce payment by the European Union would be null and void. It would first depend on a member state bringing an action before the European Court of Justice – the European Union as an entity cannot do so. But significantly, the ECJ would no longer have jurisdiction to make binding legal judgments against the UK. A double-edged sword in that the Government’s White Paper has clarified that the Great Repeal Bill will remove any supremacy of EU law: indeed, it will cease to be a source of domestic law, removing any possibility of enforcing the UK’s financial obligations.
On top of all this, the Attorney General confirmed to me in the Commons on Monday, that if Britain extended its transition period, not only would we owe £39 billion, but potentially many more billions in the transition years.
But even if the Government is right, and even if we must pay £39 billion, is it fair to give them a whole load of money without asking for anything, in return – for example, an end date for the Backstop?
We need a Stop-Gap, not a Back-Stop.
What happens if the deal falls in the Commons? What is the alternative? If you read David Owen or George Trefgarne, you will see that one proposed solution is to rejoin the European Economic Area. Having signed up to the EEA back in 1992, a letter to the European Free Trade Association is apparently all would take to reactivate our membership – a seemingly painless alternative to anything else on the table.
If this route is adopted, Trefgarne argues we would face no extra tariffs, and we would be in the Single Market – but outside the Customs Union. We would no longer be under the jurisdiction of the European Court of Justice, but the EFTA court, of which three out of five of the judges would be British.
If all this is correct, the EEA route seems to me a sensible way forward if Parliament can’t agree on a deal. It would give us a temporary ‘stop-gap’ until we negotiate and prepare for a potential, full No Deal with the EU, but it wouldn’t cause significant problems in terms of business and the economy. Belonging to the EEA would also cost much less – an annual payment of between £1.5 to £3 billion.
The beauty of this stop-gap is its simplicity. Owen states that “We, like the three other non-EU members of the EEA, would not be starting out as part of the EU customs union, though we could pursue that. We could pursue our own EU-UK free trade association (FTA)….there is no necessity for us to join EFTA. We would not be fixing any time limit as to how long we stay in the EEA. Like the other three non-EU countries, we would continue to be bound, as are all parties to the EEA agreement, to give one year’s notice of leaving.”
In a recent, brilliant BBC Westminster Hour interview, Charles Walker said that next week’s vote is possibly one of the biggest votes that all MPs will make for many years. He is right. Whilst I really worry about the chaos that may ensue if the deal is voted down, the issue surely is: do you vote for the deal, with its flaws, because of worries about the aftermath (i.e. do you vote for nurse, for fear of something worse) or do you vote on the merits or demerits of the deal itself – value to the taxpayer, and whether the referendum result is being truly honoured?