I spoke at the Conservative Progress conference this weekend where I outlined the current state of play with Brexit and what will go into the negotiations. You can read my full speech below.
Ladies and Gentlemen,
Our country stands on the brink of an exciting and hugely promising chapter in our centuries-old story.
Landmark is an overused word – but the decision made in the referendum last year that we should leave the European Union can be described that way.
At a very significant fork in the road we chose our path. We may not have chosen the way that is simplest to navigate or easiest to walk, but we chose the one that leads in the right direction.
As we all come together to deliver on the democratic will expressed in last year’s referendum, by leaving the EU we will we will shake off the blinkers that have kept us focused on the concerns and demands of one small corner of the Earth – and lift our sights beyond Europe to the rest of the globe. Quite literally, a whole world of opportunity is waiting for us.
Now let me acknowledge something straight away. Although we have passed that landmark, although we have taken that fork in the road, we still cannot know for sure just where the journey will take us.
That will partly be decided in a series of negotiations which may take several years. If we were negotiating with ourselves I could tell you now what the outcome would be. Sadly, that’s not allowed. So I can’t. Neither can the prime minister – so perhaps people should stop asking her so often.
What she has done is to set out her priorities for our new positive relationship with the EU.
In January 2017 she listed 2 broad aims. Briefly –
- Certainty over the deal and a vote in both Houses of Parliament before it happens.
- Control of our own laws. With European courts no longer having power over ours.
- A stronger United Kingdom, with powers returned to devolved administrations.
- Maintain the common travel area with Ireland.
- Controlled immigration, while attracting the brightest and best from across the world.
- Rights for EU nationals already in our country, and the same for Britons in the EU.
- Protection of workers’ rights.
- Free trade through an ambitious agreement with the EU, but without us contributing huge sums to the EU budget.
- New trade agreements with other countries around the world, outside the EU customs union.
- Co-operation on science ad innovation.
- The same in the fight against crime and terror.
- An orderly Brexit, with an agreement within two years followed by phased implementation.
Of course after her speech our opponents still tried to say she had no plan or was refusing to reveal it. Well it looked and sounded like a plan to me and Theresa May looked and sounded like the person to deliver it.
LEG 1 (Negotiating principles).
So what should be our guiding principles, the points on our negotiating compass so to speak, as we start to navigate these talks once article 50 is invoked. Well, let me lay out eight principles based on my own experience of negotiations in Brussels.
Firstly we should be clear about our priorities – the EU 27 who will be negotiating with us deserve that, and so does the public here at home. But we must do so without revealing our entire hand of cards. I believe the Prime did that masterfully with those Lancaster House principles just outlined.
Secondly – let’s make sure we set the right tone.
In Brussels, the mood music matters. We should seek to enter these negotiations in a spirit of cooperation, making it clear that we do not see leaving the EU as a zero sum game, nor do we hope that this will lead to the break up of the EU.
Instead, we hope that both sides will see it in both our interests to have a prosperous UK enjoying a good trading and political relationship with a prosperous EU.
At the same time, we should be prepared for the fact that not everyone will act in a rational way and there will still be some voices calling for the UK to be punished for daring to leave or as a disincentive to political parties in other EU countries questioning their membership of the EU. That has already happened, but in Brussels and particularly in the other member-state capitals, we sense that such hot-headedness is cooling, calming and giving way to a more sensible and pragmatic approach.
Next we must understand how the EU negotiates.
In trade negotiations, the EU usually divides its goals into offensive interests (the markets or sectors it wishes to gain access to) and defensive interests (those it wishes to keep closed). While what we face is not purely a trade negotiation, it would be wise to look at negotiations in this light.
Of course, we will be facing an EU seeking to close some markets or sectors that are currently open to British companies. There will also be many parts of the existing relationship that the UK will be seeking to leave. However, there will be also be areas of mutual interest where in an ideal world we would continue to cooperate, such as on sharing intelligence or even on some security operations.
Fourthly we should look to identify potential trade offs.
For example – even if we agree areas of mutual interests – they may need to be reviewed in the light of other demands. For example, while German car makers or French farmers may want open markets to continue to sell their products to the UK. Some German and French finance firms may want to erect barriers to UK financial and other professional services. We will be aware of these potential pinch points and will be watching for them coming as the negotiations progress.
Importantly -we must remember the EU is more than the sum of its parts.
It is not a monolithic organisation. For a start there are three EU institutions involved: The European Council, the European Commission and the European Parliament. They will not always agree.
The council in turn represents the 27 members. They will not always agree.
The Parliament comprises 751 members from 28 countries in eight political groups from Communists to the National Front. Or as I like to say from Soviet Socialists to National Socialists.
Is a pattern starting to emerge?
They will not always agree.
While many in Brussels were impatient for article 50 to be invoked, the EU was itself not ready for negotiations. At the end of 2016, the three EU institutions finally agreed their respective roles amongst themselves.
Article 50 of the Lisbon Treaty stipulates that negotiations with the UK will be “concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament”. However, the European Council agreed to ask the Commission to do the bulk of the heavy lifting in negotiations.
While the European Council has been trying to sideline the European Parliament, the Prime Minister and British ministers have met with senior MEPs, and this is clearly appreciated.
In December, after the formal EU council of 28 national leaders, the 27 other heads of government had a separate meeting to prepare for Brexit negotiations. This was reassuring, since it demonstrated that the EU has finally got the message that the UK will be leaving.
The role of the EU 27 also opportunities some opportunities as well as threats for the UK government. While some some governments such as the French have been hostie in public, I have met Prime Ministers, other Ministers, ambassadors and MEPs from other EU countries, while expressing regret that the UK will be leaving, emphasising the need for strong bilateral relations between their individual countries and the UK. Many have offered to help us at the Council if and when the negotiations get tough. We should be nurturing these important bilateral relationships.
All this highlights the fact that these negotiations will be carried out at many different levels, UK to EU, talking to different institutions, UK to individual countries, sector by sector, exiting the EU and a new agreement.
Point 6 – We should make sure to ask for more than we want.
In an article “learn lessons from the failed negotiation”, David Cameron’s former advisor Mats Persson, wrote about a European diplomat who told him this: “In Europe, we ask for 10 things in order to get six. You ask for four things to get four… Why?”
It’s a good question. In any negotiations, we should always ask for things that would be nice to have but would not be deal breakers. The EU will do the same to the UK: note Michel Barnier’s supposed demand for €60 billion to leave the EU. We should be construct similar demands of the EU.
Importantly – I believe we must be prepared to walk away.
We should enter these negotiations with an intention to succeed but not being afraid to walk away if we don’t get a deal we are happy with. At some stage, the UK government may have to make it clear that we will not simply accept any deal and would be prepared to walk away and settle for a WTO relationship with the EU, even though we would prefer a tailored EU-UK deal.
Finally – Let’s keep a cool head and steady hand
Fortunately, Theresa May has both. She has a reputation in Brussels as a tough and shrewd negotiator. Her time as Home Secretary is recalled when she took the UK out of the Justice and Home Affairs chapter of the Lisbon Treaty, then opted back into individual measures where she felt in was in our interest to cooperate.
While Labour, Lib Dems and some Conservatives who wish to block Brexit will criticise every move by the Prime Minister, my hope is that those who voted for Brexit put aside their impatience and not cramp her style. Be patient. Give her room to manoeuvre, space to breathe and time to tune our demands. For every detail given in public of our position is a hostage to fortune, an advantage handed to other side, a stick to beat our negotiators and our PM with.
The old proverb warns that fool rush in. Greater wisdom there than a whole bank of opposition benches could muster. Look at the egg on the face on many of those who treated the resignation of Ivan Rogers as a disaster only to see a clearly composed Prime Minister, very much in control, appoint a successor within a day.
The PM may be doing things the hard way, but she is doing them the best way. She knows her principled “no running commentary” response means a long, rocky road, but she is battling her way along it.
She realises she is frustrating EU officials, the opposition, Brexiteers and the media for good measure. Too bad, because she is determined to ignore the siren voices and do what is best for Britain.
She will not be phased by criticism, nor distracted by flattery, but will do what is right.
Leg 2 (Look to America)
As I said at the outset, Brexit is a wonderful opportunity to engage with the rest of the world and revive our relationships with our oldest friends and allies once more in a way that membership of theEU has prevented.
Nowhere is that more true than when we consider the United States – THE biggest economy in the world, THE greatest power, THE most prosperous. OUR closest allies and greatest friends.
Now admittedly, like all friends they may sometimes do or say things we don’t like. They may even elect people we probably wouldn’t – but our partnership is with the American people, not their politicians. And trade happens between people and between businesses, not between politicians.
If you happen not to like Donald Trump very much, I would encourage you – as an American might say – Don’t get too hung up on that. Or as we say in London “Don’t let him get up yer nose.”
Whether a success or a failure, a president is only there for a few years. By contrast – The opportunities Brexit can bring will be for our lifetimes and for generations to come.
That is why Theresa May was right to reach out to the new administration in its early days. That is why she was right to sell the mutual benefits a UK-US trade partnership will bring. That is why she was right to step out from the back of the queue and calmly take her place at the front.
And she didn’t just stake out her ground on the issue of trade. In the field of security and defence she won reassurance over the importance of the role of NATO in protecting the freedom of all of us in the West.
On security and intelligence too, the scope for enhanced co-operasion with the United States will be considerable once we are free from the EU.
The United States remains the land of opportunity, and outside the EU we can share that opportunity too.
Leg 3 (My vision)
America is not the only part of the world where new horizons will open to us. The whole world is out there to engage with us, to co-operate with us, to trade with us. Liam Fox has spoken of the number of countries lining up to sign trade agreements. I have spoken to Prime Ministers and governments that want to sign trade agreements with us.
That is why it is so wrong to equate Brexit with insularism or intolerance.
My vision of our future Britain is of an open, tolerant, global trading nation.
A country with genuine and fair control over its immigration rules, but one which more than ever is open to the best talent in the world.
A Britain renowned across the world as a hub for innovation and entrpreneurship. A country where science is valued, international co-operation is the bedrock of research, and technology drives our prosperity.
My vision is of a country that is fair and free and open for business with the world.
My hope is that – when in years to come – we look back to the decision of the British people in June 2016.
We will see it as a truly historic point when the UK re-emerged as not
Just another European country
But as a truly
Outward looking
Tolerant
Global nation
And a beacon of
free trade
and liberty
For the rest of the world.
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