Systems and Processes - The Need For a Brexit Transition

Once the Brexit deal has been done with the EU, systems and processes will have to be changed or developed:

1. Import and export systems, within businesses and at ports
2. For functions currently being carried out by the EU that the UK government will be taking over.  Some 20 new bodies, plus expnsion of those such as for Data Protection
3. In businesses and other organisations to cater for any other adjustments

Changes to systems can take weeks or months.  New systems take months or often years to specify, write, test and deploy.  This can only be done once the requirements are known.   In this case for the deal to be finalised and any new business model and process designed. The devil's in the detail.

Any deal with the EU won't be till late 2018 or early 2019.  So for no other reason there needs to be at least another two years for systems to be developed.

It simply isn't pragmatic to expect to exit the EU cleanly by March 2019.  Nor is it sensible to just walk out of the talks with no deal. The systems will take another couple of years before they are all effective. The absence of working systems would make life extremely difficult, potentially catastrophic.

So to those clamouring for Philip Hammond to be sacked for seeking a transition, just think a moment about the practicalities.  Thankfully there is at least one adult in the Cabinet.

I would go a stage further.  I'm not a fan of the EU.  But let's Stop Brexit and avoid all this nonsense.  Put all those efforts into moving forward, not just trying to stay still.

Brexiters. Don't Forget The Timing!

Timing.  It's the key to comedy.  It's the key to Brexit.  But Brexiters seem to ignore it.

It's interesting seeing the newspapers laid out in the local newsagent.  Easy to compare the headlines, from the FT to the Star.   I'll come back to the FT's in a minute.

Only when dipping into the i newspaper did I see the headline "Shout it out: Brexit is good for us".  It's actually a very good summary of the justification for Brexit, written by Kathy Gyngell, a Conservative journalist.

I happened to read it sitting alongside a couple from New Zealand. Started chatting. They are British in origin, lived here, now retired, and over here for a holiday.  I asked them what the view of Brexit is 'down under'.  There isn't a general view, as people there have a lack of information.  They personally are looking forward to a new trade deal to boost trade.  They also commented that when they voted for the Common Market there was only 6 countries and it was to be all about trade.  It is much different now.  Many people over 60, who voted in 1974 and 1975, voted to Leave for that reason.

The change from 1975 is one of the reasons quoted in Kathy's article.  As someone who is euro-sceptic (as distinct from europhobic) I agree. But Brexit is not the answer.  A key reason is timing. Critical, but something which Brexiters seem to consistently ignore.

I could challenge Kathy on all her points, but will concentrate on those relating to timing.

TIMING OF TRADE DEALS

Let's start with trade deals.  With the best will in the world, each deal takes years to negotiate, let alone trying to run many in parallel. These can't be concluded until after the UK leaves the EU, and officially negotiations can't even start till then.  In any case, the nature of the EU/UK relationship for trade needs to be understood first. We're talking 10 years from now, maybe 20. Still great news if the UK/EU trade has held up. But what if it doesn't?

TIMING ON TRADE

The article says "deteriorating economic prospects (untrue)".  Kathy might like to look at forecasts from several forecasters, including the IMF, perhaps published since she wrote the article. In any case can we afford the risk?

She goes on "Within weeks of the referendum, Britain had an economic boom; the much-needed depreciation of the pound had an immediate impact on exports and set off a tourism bonanza.". It did.  But I don't remember an earlier clamour of voices for a devaluation. Do you?  The reason is the positive consequences are outweighed by the negative .

The significant deterioration of the pound's exchange rate means people from elsewhere in Europe, especially those who send money home, are less inclined to come to the UK to work. Those already here are inclined to go elsewhere in Europe.  Here's the impact on farms. So Kathy you might like to think again when you say "skills shortages due to the ending of free movement (untrue)" - it's happening now!  Timing.

More importantly perhaps, she doesn't mention the impact on importers and imports.  You might enjoy a glass of wine, of prosecco or a sherry. The vast majority of these products are imported in euros or US dollars. Beer is made increasingly from imported hops. Wine importers will fix their purchase price in sterling, and therefore their sales prices, with forward currency exchange contracts. Like many other importers, purchases in most of 2016 were covered, so little affect in 2016.  But for 2017 they have had to pay current exchange rates.  Sterling cost up, so either it's an increase in sales price or a squeeze on margins. For most importers, there is only one option - increase prices.  A time lag that is a matter of timing.

With so much of our food and drink imported, prices are rising fast in the supermarkets. Deals at £2 are now £2.50.  It means that overall CPI inflation is running above target at 2.6%.  Creating a real-terms drop in living standards, especially for the lower paid who are harder hit by food price inflation.  Again, timing.

TIMING OF HOLIDAYS

It's now holiday season. For many, summer is the one time of the year they go abroad.  Holidaymakers got less for their pounds last year, and even less this year.  Even the Sunday Mail complained that it was because of Brexit!  Another matter of timing.

Let's see how public mood is about Brexit come the start of September.  That's when Parliament returns and the first Brexit Bill is debated, the "European Union (Withdrawal) Bill 2017-19" .  We must stop Brexit.

So sorry, Kathy. Your arguments just don't stand up. One key issue. Timing.  Don't forget it!

BACK TO THE FINANCIAL TIMES

The headline is "Hammond seeks two-phase Brexit deal with 'off-the-shelf- transition", with the sub-title "Not enough time to negotiate 'bespoke plan'"

This is the other great timing bungle from the Brexiters.  Suzanne Evans was on TV recently saying that all could be sorted with the EU in two years.  That's highly unlikely.  But even if that were possible, there would be no time for changes to IT systems and business processes, either within businesses or at UK's borders.  Her views are utterly dangerous, economically.

Talk is of a transition phase between officially leaving the EU in March 2019 and perhaps the three years to 2022. Basically the practicalities will stay the same for that period, including free movement of people.  That would provide time to implement the post-Brexit agreements.  Frankly it is the only sensible way.

Brexiters will be jumping up and down with rage. "Let's just walk out" they'll say "and adopt WTO rules".  Which brings us back to New Zealand.  Lamb, butter, wine and the many other products they already sell to the UK.  There are typically limits to what can be sold, but these are currently set to cover the whole of the EU  What they can sell to the UK and EU will have to be separately negotiated,  product group by product group.  It won't be easy. New Zealand will lose the flexibility they currently have. It will take years.  And then the systems and processes will need to be changed. adding months if not years more.

Brexiters please stop the talk of walking away from the EU to adopt WTO rules.  The timing issues are horrendous.

Timing.  It's no laughing matter!

Eurosceptic or Europhobic?

I am sceptical about the political direction of the European Union (EU), and believe fundamental change is needed.  That is ‘Eurosceptic’.  But I voted Remain and am now campaigning to Stop Brexit.  This is because Brexit is not the answer, and any advantages are outweighed by threats to both the UK economy and our culture.

So “Eurosceptics” is not a good term to describe those people who are strongly against membership of the EU. 

Here’s the suggested nomenclature to more clearly describe the four main groups in the ongoing Brexit debate:

VOTED	ATTITUDE	DESCRIPTION	NICKNAME
Remain	Pro-EU, Europhilic	Remainers	Remoaners
Remain	Somewhat Eurosceptic	Remainers	Remoaners
Leave	Eurosceptic	Leavers	-
Leave	Europhobic, Anti-EU	Brexiters*	Brexshitters  Euroloons

·                                                                                                                                               * Not Brexiteers, which is far too heroic

Both groups who voted Remain are likely to be moaning about Brexit, and campaigning either to stop Brexit or against a 'hard' Brexit. As such their description and nickname can be shared.

But on the Leave side, there seems to be a big difference between those who are:

• Anti-EU, wanting to be clear of the Single Market and the Customs Union, the ECJ and any other aspect of the EU.  "Europhobic Brexiters".
• Those who want a closer ongoing relationship with the EU, albeit it formally out of it.  "Leavers"

Satisfying both these groups is one reason why the Government has struggled gto come up with a clear proposal to the EU.  In fact it is impossible, which remains a key issue. 
I wonder how many people are in each group, roughly?  I would imagine that it is much like a normal distribution, say 10:40:40:10.  
 

The concern then is that some 10% of the population are driving the other 90% over the cliff. 

That’s not democracy.  The referendum was a ‘starting gun’.  A project as risky as Brexit needs continual review, and if necessary a stop. There were no formal review points planned, but effectively they are provided by each Brexit Bill that goes through Parliament.  There are eight Bills in total, with the first being the "European Union (Withdrawal) Bill 2017-19", debated on 7 September.  

We have till then to get MPs to vote it down.  Here’s how – see the “Affect on Brexit”section.

Lies. Lies. Lies. Can Politics Recover?

Trust.  Perhaps the most important aspect of human relationships. Without it we are sunk.  Friends, marriage, business.  Especially the politicians who want to represent us, who are usually in politics for the most honourable of reasons.

But we have a problem.  It is becoming the norm that in the quest to win, honesty is given the heave-ho.  Lies and half-truths abound. Two recent examples, one from the left of politics, one from the mainly right.:

(1) FROM THE LEFT

These last few days has seen the Labour party rightly exposed for what they said about Student Finance. Corbyn himself might be "innocent" but the Labour party certainly isn't.  Hodgson in particular, who the Guardian's 'FactCheck' says sent a "highly misleading tweet".  Sadly I don't remember Corbyn denouncing this

In any case, I spoke to several younger people just before they voted in the General Election.  Graduates and under-graduates.  They weren't interested in other options. They were voting Labour for one reason only. Their Student Finance.  Lies, ambiguity or simply misunderstanding?

Nonetheless two key points arise:

• Would we have had a hung parliament had this topic not surfaced?.
• Will the trust of younger voters in politicians, and the Labour party in particular, be lost forever?

(2) FROM THE RIGHT

At the other end of the political spectrum we have the Brexit bus.  The Leave campaign were still promoting this even after Nick Robinson showed that £350million was the gross figure.  The real figure net, after money we get back as rebate and grants, was just over £100 million.  Even then, this money would only be available if tax receipts held up.  Forecasts are tax will drop by a larger amount. The bus really should have said "Leave and there will be less money for the NHS".

I certainly overheard one person, a couple of days after the Referendum, saying they had voted Leave primarily because of the bus.

Would Leave have won without it?

THE WAY FORWARD?

Trust in politicians has always been low.  But has trust ever been lower?

A key problem is that the Advertising Standards Authority has no authority over politics.  Here is their explanation of why not, despite attempts to cover political advertising.

Nor is there any equivalent of the Financial Conduct Authority.  Documents published by quoted companies need to include suitable warnings about the reliability of forecasts.  Key statements and forecasts need to be independently reviewed before publication.  Directors who make false statements can be criminally liable.

UPDATE: Lord Sugar has made the same point in comparing statements made by politicians with those made by directors.

It would be good if key political statements, like the two above, could be reviewed independently by a "Political Conduct Authority".  Representatives of political parties would then need to abide by the agreed statements.  That would have the added bonus of not contradicting each other.  A suitable caveat would need to be shown against any forecasts and opinions, which for oral statements would be like the 'small print' hurriedly spoken in radio adverts.

The difference with politics is that an election is a rapid onslaught of statements and counter-statements, especially in the last few days.  Could a process of independent review be practical?

Or is it a matter for a voluntary Code of Conduct that might include, for example, publication of an web page for every individual significant policy statement.  That could include any independent support, perhaps published previously, and any relevant caveats.

Frankly I'm thinking aloud.  Just to start a debate.  Because if we don't solve the issue of trust, politics is down the pan!

UPDATE Thursday 27 July:   The New European today has an article on p28, not yet online, titled "The Psychology of Lies and Why We Fall For Them".  This explores the relatively recent phenomenon of the use of blatant lies in politics.  As the author Louise Chunn says "In previous decades, politicians might evade or spin to their advantage ... but they tended to stay away from bold statements that could be easily disproved.".  She gives the recent example of Nigel Farage and his Article 50 lie, where he held up wording that wasn't even in that clause whilst broadcasting for LBC.  The words came from a briefing note, but missed further words which changed the overall meaning.  Whilst LBC deleted their tweet about it, Nigel hasn't.

Brexit: View From Across The Channel

Unsurprisingly we tend to view Brexit from our UK perspective.  But negotiations are really about understanding the other side's position.  Their objectives, constraints and preferences.

So it is interesting to see Sabine Weyand, the EU Commission's Deputy Chief Negotiator retweeting this article written by Fabian Zuleeg, Chief Executive and Chief Economist at the European Policy Centre (EPC).

Some choice quotes, confirming but also expanding on what we already know:

"...greater goods are at stake: the unity of the EU27, the integrity of the Single Market and the future of European integration. While there is willingness to find a compromise with the UK, a country leaving the EU cannot be better off than a remaining member."

"The notion that the EU could somehow concede on fundamental aspects of the treaties, such as freedom of movement or the oversight of the ECJ, is not only unlikely but would be struck down by the Court when challenged..."

"The way the UK has conducted these negotiations has burned many bridges and there are precious few allies and friends left. And the longer this approach prevails, the harder will it be to turn the situation around."

And most significantly:

 "But despite the collateral damage, most EU27 would probably welcome a committed and constructive UK back into the fold if a significant political change occurred."

A significant political change?  That's just what The Just Party has in mind, as detailed yesterday

We can then #StopBrexit and sit down with the EU for what would need to be conciliatory talks.  Then we can avoid the LOSE-LOSE where we are currently headed. 

If you believe this is the right way forward, do see here for how you can help.

Back To The Future

In recent weeks I have been writing about Brexit.  Despite being a euro-sceptic, believing change in the EU is necessary. it is clear that Brexit itself isn't the answer.

Brexit is a high risk to the economy and society generally.  The process involves a hell of a lot of effort to avoid the UK going too far backwards before there is any chance of going forwards.  That and a complex and costly transition that was severely under-estimated.

It is clear that we need to stop Brexit.  Whilst there will be change in the Brexit arena over the summer, the really key event is debate of the "European Union (Withdrawal) Bill 2017-19" that starts in the Commons on 7 September.  That's when MPs can have their say and wield their vote.  

THE WAY FORWARD

But Brexit is only one issue.  The Just Party aims are for a Thriving Economy and a Caring Society.  Over the past few decades we've seen:

1. As socialists, Labour governments have aimed for a Caring Society.  But they have failed to create a Thriving Economy long term.  Socialist policies require funding that always proves counter-productive.  For example "Labour isn't working" was true in 1979 and "I’m afraid there is no money." true in 2010 when the deficit was going through the roof
2. True Tory policies tend to favour the rich, to the detriment of the vast majority.  Theresa May was right when, as Chairman, she called the party "The Nasty Party".  It's core still is.

The Just Party was formed as a result of the party conferences in the autumn of 2014.  It was clear that not even the LibDems could represent the vast majority of the UK's population. This was partly because they had failed to make any great parliamentary impression, and partly why they hadn't.

Around that time ComRes published research that showed voters and non-voters alike mostly regarded themselves as "centrist", with a slight bias to the right. That is exactly where the Just Party is, in the light blue 'cyan'.  Simplistically with the top line of the graph representing the opinion of all adults and the lower one of voters:

THE JUST PARTY'S AIMS

The Just Party's principal aims are:

1. Thriving Economy through strong financial management
2. Which provides the money for a Caring Society
3. Which unlocks people's potential for a Thriving Economy, etc.  A virtuous circle

Here is how these principles would be applied across principal policy areas, such as housing and defence. 

Governments that have tended towards the centre have tended to win elections.  'New Labour' for example, though the socialist underpinnings turned sour in the end.

To achieve this vision requires The Just Party getting into power.  How can that be done?

GETTING INTO POWER

Whether you like the 'First Past The Post' (FPTP) electoral system or not, the failure of the Alternatie Vote referedum of 2011 means FPTP is what it will be for the UK Parliament for the foreseeable future. Whatever system you believe in, fighting for change is a waste of time.  The Just Party believes in getting into power under FPTP.

Voters are led primarily by the media, both print and broadcast, plus of course social media.  Perhaps the most powerful is TV and radio.

OFCOM is responsible for setting the election rules for all the main UK broadcasters, including the BBC from April 2017. The regulations stipulate broadcasters must include and balance all parties and candidates with:

1.  Past support and/or
2. Current support

Other parties and candidates with "significant views and perspectives" should also be considered. But in practice a seat in Westminster is the deciding factor.  It's objective, not subjective:

• With one seat, that's why the Greens are included..  
• UKIP had to have two existing defect and be re-elected to join that 'club'.  UKIP may have lost both MPs now, but their ongoing following will effectively guarantee their coverage.

Indeed it is almost impossible to gain media coverage without a seat in Parliament.  Chicken and egg.  The only route is defection of MPs to a new party who expect to be re-elected:

• The four who formed the Social Democratic Party (SDP) in 1981 which morphed into the LibDems
• The two who defected to UKIP in 2014

What about MPs defecting to The Just Party, or some centrist equivalent?  Talk became serious in July 2016, just after the Brexit referendum.   The Observer reported that this was being considered by a group of Labour and Conservative MPs up to Cabinet and shadow-Cabinet level.  This was  when Andrea Leadsom was being considered for Tory leader on the one hand, and there was serious concern about Jeremy Corbyn on the other.

The appointment of Theresa May as Tory leader meant the idea of a new party quickly withered, but the idea of Leadsom as leader has resurfaced.  Corbyn has also just lost a General Election, despite the extra support from youngsters based on the 'lies' on Student Finance (which I know swayed younger voters I spoke to immediately before they voted).

We now have the new "All-Party Parliamentary Group on EU Relations" (Twitter @eurelationsappg).  The two leading figures in this group are the two Co-Chairs:

• Anna Soubry, the most vocal of the Conservative 'remainers'
• Chuka Umunna, the Labour MP who proposed an amendment to the Queens Speech to stay in the Single Market, which is against Labour party policy.

Whilst this group is focused on Brexit, it provides a forum for broader discussion.  It's difficult to imagine that discussion has not included a new party formed by defection of both Tory and Labour MPs.  That is exactly The Just Party's vision:

The Just Party is not aiming to be "LibDems2".  The LibDems social democratic background is to the left.of centre, of attraction primarily to Labour members but not so much Conservatives.  The Just Party is centre, mixing both Labour and Conservative.  Whilst LibDem members and voters will, be very welcome, it is expected that the LibDems will continue. The bigger picture is therefore:

That would result in this political spectrum, as shown here and above.  The Just Party in 'cyan' would be the party that most closely matches the peak of the public's centrist preference:

AFFECT ON BREXIT

The Just Party simply wasn't ready to contest the 2015 election.  At that time thinking was it would take at least 10 years, and two General Elections before being able to offer the public a Just Party government in at least 2025.

The snap election this June has thrown that up in the air, and makes a quicker party realignment more feasible:

• Theresa May now only has a minority government, propped up by just 10 MPs of the DUP
• Inherently the government is at risk of losing key votes, if only a small proportion of Tory MPs abstain or side with a Labour-led opposition.  
• Parliament are in 'recess' (on holiday) until early September.  That's when there will be the debate and vote on the "European Union (Withdrawal) Bill 2017-19", 
• Losing key votes could mean another General Election  in prospect for .the autumn.  Labour are already campaigning in marginal seats

Would enough Conservative MPs be prepared to defy the party whip?  They may fear the election of Jeremy Corbyn as Prime Minister.  Or like Labour MPs fear losing their own seats if representing their existing party.  Depends on opinion polls.  Corbyn's recent retraction of what was taken as 'promises' on Student Finance by many young people may lose him their support.  Nothing he promises should ever be taken seriously again! That may prove key.

Given DUP numbers, would say 10 moderate MPs from both Labour and Conservative be prepared to defect to a new party?  Yes if their heart and head is agreed on stopping Brexit, combined with more natural support for their new party's policies.

It takes weeks for a new party to be formed.  Documents have to be discussed and agreed for submission to the Electoral Commission.  The registration process itself can take weeks, longer if issues arise that need to be resolved. Too late now for September.

The Just Party is registered as party 2520 and ready as a "vehicle":

• The Aims and Values are a template for a manifesto.  It is anticipated that the defecting MPs will develop and "own" that manifesto
• The MPs can appoint a new Leader
• A high profile Chairperson is needed, perhaps from outside that group of MPs
• The Just name and logo can be changed if better ones are available, either initially or subsequently. 
• The registered Constitution is based on that of the centrist Liberals, and again can be changed or replaced in due course.

HOW CAN YOU HELP?

If you are a sitting MP interested in using the Just Party for your new party, then do get in touch.

If you know likely MPs then do bring this article to their attention.

In any case if you support the vision above then do make yourself known.

I am donating my time, which as a self-employed professional means I;m donating lost earnings.  I am looking to others to provide the cash for:

• Party costs such as social media marketing
• An election Fighting Fund for whenever the next General Election is called
• In due course premises and admin personnel as The Just Party grows
• Some remuneration for myself whilst I remain involved, if more than my spare time is needed

Donations up to £500 can be made by anyone anywhere, anonymously if you wish. Higher sums by arrangement.  Membership is also available, though you may not yet be ready to relinquish any existing party membership.

Donations of £10, £20, £50 or whatever would be very gratefully received.  This can be done through the GoFundMe site here.  Thanks!

Time For A Two-Part EU?

Today's complexity across Europe

Today is unusual. I usually write one blog article.  Today this is the fifth.  That is because three of them through the links below have led up to this one.

There has long been talk of a 'two-speed Europe', or what might better be described as two parts:

1. Countries like France, Germany and Ireland keen to adopt the same currency and forge greater political union.
2. Countries like the UK, Norway and Switzerland keen to be part of a Free Trade Area trading club, much like that envisaged as the Common Market.  But maintaining a degree of independence, in particular to have their own currency and control over interest rates.  

Norway is part of the border-free Schengen area, basically because of the long land border with Sweden.  But the UK and Switzerland also want some degree of control on immigration.

The desire for independence was part of why Leave won the UK's Brexit vote last year.  Heart perhaps ruling head.

The difficulty of Brexit, and perhaps the difficulty of stopping Brexit, suggests a third option might be the way forward.  To rationalise Europe more cleanly into the those two camps, with two common arrangements  If not immediately, certainly within 5-10 years.  That would simplify most of the complexity in the diagram above.

New countries, such as Turkey, could be part of the second trading club without joining the EU itself

But any thought of a new trans-European landscape must take into account the land border between Eire and Northern Ireland.

Both Leavers and Remainers could unite around such a proposition.  This is because there are euro-sceptics (as distinct from euro-phobics) in both camps.  the EU may also see it as a better way forward.

Would this be a better outcome for the UK than either Remaining under current terms or Brexit?  How practical to achieve?  At this stage it's just an idea, and maybe too idealistic. But worthy of some serious consideration? Your thoughts?

Could Stopping Brexit Be As Messy As Brexit Itself?

The Just Political Party has been campaigning to stop Brexit.  But something this morning stopped us in our tracks.  An article in the Financial Times titled "An exit from Brexit would prove a messy affair"

Lord Kerr, who wrote Article 50, has long said that Article 50 can be revoked unilaterally by the UK if we want to stop Brexit. He continues to urge us to do so.

However the EU disagrees. Their website very clearly says  "...once triggered, it cannot be unilaterally reversed. Notification is a point of no return. Article 50 does not provide for the unilateral withdrawal of notification."  Indeed revocation isn't mentioned in Article 50 (or elsewhere) because no country like the UK that wants an ongoing relationship with the EU was ever expected to leave.

So who is right?  The problem is that it may well have to be resolved in Court, if one side or the other doesn't give way.  

The FT article suggests "Any request to revoke Article 50 requires European Council consent"  


But isn't it in the interests of the EU to give way, to protect the trade with the UK and the monies the UK puts into the EU pot?  Their budget is in a bit of a pickle without those monies. As such the UK does have the upper hand in any Stop Brexit negotiation.

However, should European Council consent be needed, the FT article argues that the EU would hold the upper hand, and could demand various concessions.  That might include removal of various opt-outs, or removal of the significant rebate that Margaret Thatcher negotiated.

Maybe the EU would insist on the UK leaving and then re-applying.  That could well mean having to adopt the Euro.  Would the British public stomach that as a condition of re-entry?

The FT article goes on to conclude "an exit from Brexit is no longer an option"  Really? Frankly this should have been all sorted and clearly understood before the Article 50 notification was made. But in the UK, the political mood was for Brexit, despite a fairly flimsy Leave majority that was prone to reversal.

I would like to think the EU value the UK enough, for our trade and monetary contributions, to welcome us back with open arms should the UK choose to stop Brexit. But maybe not.  

In any case, with the UK set to fall off the cliff of leaving the EU without an ongoing agreement in March 2019, any revocation needs to be sooner rather than later to allow for subsequent negotiations.  

Apart from anything else, computer systems would need to be amended for any new cross-border tariffs and non-tariff requirements.  That can't be done quickly and is a real risk to the UK's imports and exports with the EU, even if similar to trade with the rest of the world.. 

What do you think?  Any lawyers out there?