Why Brexit is a real mess

Boris Johnson promised the earth at the last election but what he delivered was a complete shambles. A key Brexit document is Schedule XIX, which lists all the tariffs for UK imports and the conditions that apply to them. Look a bit more closely and you will see that it is in fact still a lightly edited version of the Common European Tariff (CET). It has been retained from the UK’s days as an EU member state and transferred into British policymaking for Brexit without any real thought about what it should achieve. For a start, it is still designed for member states to keep control of third country imports. In one sense, this should come as no surprise, since the CET is in force for all member states of the European Union, including the UK until Brexit. It would have been reasonable to suppose that an historic change in UK economic policy should have been matched by a political and procedural vision to make it fit for purpose. No chance.

If the whole point of Brexit was to break free from the European trading bloc, a failure to adapt the CET to fresh trading perspectives is more than a basic oversight. It is a fatal flaw. The roots of the CET are in the mechanistic visions of the 1970s to make third country imports uncompetitive against subsidised EU products. It is not constructed to serve third country interests without a lot of serious modifications. Since Brexit was regarded as the grandstanding opportunity of the century, none of the politicians who invaded the nation’s TV screens ever thought about such unimportant procedures as tariffs.

The CET contains tariffs that combine ad valorem percentages and flat rate payments in Euros, reassigned to GBP. These were best guess estimates of the day as to how much money the EU had lavished on an agricultural commodity before it reached the end user. This economic anachronism has been more firmly embedded into the UK economy without a second thought for what the UK might need from a tariff in years to come.

A cursory look for changes to the CET in its transition to Schedule XIX yields a few surprises: the schedule document I downloaded from gov.uk has no Chapter 03 (fish) and goes directly from the end of Chapter 02 (meat and offal) with the line CN 0210 90 90 “Edible flours and meals of meat or meat offal” straight to Chapter 04, listing dairy products. The missing fish chapter is complemented by a gap in Chapter 16, (PREPARATIONS OF MEAT, OF FISH OR OF CRUSTACEANS, MOLLUSCS OR OTHER
AQUATIC INVERTEBRATES) which only lists terrestrial species. Chapter 03 (fish) was restored in the version issued by Hansard: It was still denominated in Euros, but a redenomination into GBP had been scheduled.

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In a report to the European Parliament, Irina Popescu and Frederik Scholaer observe that the UK has always believed its fishing fleet was being short changed by European fisheries policies. Repeated claims that European proposals would threaten “vital national interests” were made throughout the six years of negotiations that finally led to the Total Allowable Catches system (TAC). The UK fishing industry persists in blaming the rest of the world for reduced catches, but one has only to look at archive photographs of postwar trawlers with nets full to bursting to wonder why anyone should imagine fish stocks are inexhaustable. Popescu and Scholaer allude to a sense of grievance that found resonance with numerous Brexit campaigners and their talk of “taking back control”.

British attitudes to fishery access is at best ambivalent. Since the early days of accession to the EU, UK boat owners have cheerfully sold fishing quota and whole fishing boats to foreign operators. Referred to as “flag ships*”, these vessels are captained and crewed by foreign nationals and sail to catch fish on UK quota allocations, also sold on for the purpose. Contrast this with the vitriol and bad blood reserved for foreign fishing crews and it quickly becomes clear that there will be no quick fixes for the UK fishing sector.

Brexit has raised demands for additional border checks. There are a number of longstanding verbal commitments to implement Sanitary and PhytoSanitary checks (SPS), which are to be carried out in standardised Border Control Posts (BCPs), previously known as Border Inspection Points or BIPs. A July rollout has since been pushed over into October. There are pivotal crossings passing through privately-owned ports, such as Craigryan. This leaves the UK government imposing a future requirement for border checks for fish and animal products at internal borders. Port operators are not alone in their insistence that this is unfair, even though it’s a legal requirement. EU parliamentarians Irina Popescu and Frederik Scholaer cited the objections made by Scottish salmon producers to procedures that could add up to GBP8.7 million a year to their operating costs.

The last-minute signing of the Trade and Co-operation Agreement (TCA) on December 30, 2020, was a keystone in the Brexit edifice. It marks an uneasy peace for the fishing sector. The small print gives both parties six and a half years to redefine the terms of the TCA, so even though it is a done deal it is not set in stone.