Richard North, 20/05/2018  

It is instructive to see Tony Connelly revisit last December's Joint Report, produced by the UK and EU Commission negotiators.

In particular, he asserts, the text of Paragraph 49 is coming back to haunt us, the wording apparently committing the UK to maintaining "full alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South Cooperation, the all-island economy and the protection of the 1998 Agreement".

Connelly has it that UK negotiators are now taking the text as meaning that the whole of the UK would align with the rules of the single market and customs union, precisely so that there would be no difference between Northern Ireland and the rest of the UK. And, as this sits on the table for the next round of talks, he argues that the implications are enormous.

The big problem with that, however, is that the text is inherently contradictory and, at the time, was never intended as a basis for serious negotiations. The report was merely a device to keep the EU-UK talks moving when, without some form of agreement, they would have collapsed.

Through roundabout reports sometime later, we got the backstory. Essentially, the "colleagues" were concerned that a breakdown would fatally weaken an already weak Mrs May, and perhaps precipitate a change of government, putting Corbyn in the hot seat. On the basis of preferring to work with "the devil you know", Mrs May was given a much-needed "victory" to keep her in office a little while longer.

With the ink not even dry on the Joint Report, we got from an official in the Department of Brexit – via the Irish Times - a savage qualification of what was being termed the "full alignment" Brexit pledge.

The commitment, we were told, applied only to the six areas of North-South economic co-operation identified in the Belfast Agreement. These are transport, agriculture, education, health, environment and tourism.

As opposed to 142 cross-border policy areas identified by Barnier's task force. The official claimed that these were merely subsets of the original six, and insisted that the commitment did not undermine Britain's declaration that it would leave the single market and the customs union.

"It's the six areas. The 142 are a deeper dive across those six areas. The ambition at the moment clearly is to get cross-border trading arrangements to maintain the status quo as much as we can", the official said, adding: "There are a very unique set of circumstances that apply to Ireland that don't apply to anywhere else in the UK. But in terms of customs union and single market membership, the UK as a whole will be leaving".

Nevertheless, the Joint Report paved the way for the Draft Agreement and the Protocol on Ireland/Northern Ireland.

This offered a legal text which would give form to the Northern Ireland "backstop" which would come into force in the absence of a suitable proposal from the UK government. But, since Mrs May never had intention of adopting this solution, it had her rushing to the barricades declaring that "no British prime minister could ever agree" to it.

With the cabinet unable to agree an alternative, however, and with the proposal discussed already having been rejected by the Commission, this has created a fantasy island situation where the idea of staying in the customs union has been seriously discussed as part of a "third way" solution – even though it cannot make any practical contribution to the Irish border question.

Now, in an attempt to break the logjam and end the attendant uncertainty, later today during its annual dinner, CBI president Paul Drechsler is weighing in with what is styled as a "major speech", declaring that "the current Brexit impasse is a handbrake on our economy that can and must be released".

But so fixated with the non-solution is even the CBI that Drechsler is to "call on both sides" to focus on "a pragmatic decision for the UK to remain in a customs union, unless and until an alternative is ready and workable".

Firmly embedded in the fantasy island alongside the government, the CBI wants any solution to meet four customs tests. It should: maintain friction-free trade at the UK-EU border; ensure no extra burdens are incurred behind the border; guarantee there are no border barriers for Northern Ireland and; boost export growth with countries both inside and outside the EU.

However, doffing his cap in the approximate direction of reality, Drechsler will argue that even sorting out customs will only solve 40 percent of the problem. The other 60 percent, he states, "depends on securing a deep relationship with the single market with urgent attention needed to find a solution for services, which makes up 80 percent of our economy".

Where this 40-60 split comes from isn't disclosed and the idea of having a "deep relationship" with the single market harps back to the days of having our cake and eating it, where the May government was talking glibly of enjoying the benefits of the Single Market without being part of it – something Mr Corbyn is still doing.

At least, though, we're getting some sense that there is more to Brexit than just customs arrangements, something which Irish prime minister Leo Varadkar has been keen to emphasise. This refers back to last week's meeting with Mrs May in Bulgaria. We now learn that Mrs May offered a "verbal, conceptual" proposal on the UK staying within Europe's customs structure, but "no clear shape of how that would operate was presented". And. as always, Varadkar is saying: "We need details in black and white".

What the Irish prime minister also says is that, crucially, consideration for the Single Market that deals with standards and regulations, was missing from Mrs May's proposal. Varadkar was particularly concerned about the "large quantities of animal produce that criss-cross between the two jurisdictions every day".

"Any move on customs would be welcome", he says, "but I think I need to be very clear - that avoiding a hard Border between Northern Ireland and Ireland is about more than customs".

This, he adds, he emphasised to Mrs May, giving her the same message, that resolving the issue of avoiding a hard Border requires more than customs. As to a customs deal, he states that, "if the UK is going to make a move in that space then it's something we're willing to examine, but we haven't seen anything yet, nothing in writing".

Despite that, he was unwilling to disclose exactly what the British prime minister had proposed, but he made clear it fell short of Irish objectives on the Border and would not work in a place of the "backstop".

The reluctance of Mrs May to offer any detail, though, has typified her whole approach to the negotiations. Long on rhetoric and generalities, she has never set out in detail what the UK expects of its negotiating partners – although we are now told to expect a White Paper in June, before the European Council.

For all that, one cannot avoid observing that, behind Mrs May's silence is a strong element of deliberation. She has had plenty of opportunities to set out the detail of what she wants, but has never taken advantage of them – other than to talk of the aspiration of a "deep and comprehensive" trading agreement with the EU after Brexit.

One wonders if her real strategy is to run the talks to the wire in the hope (or expectation) that the EU will cave in and give UK traders unrestricted access to Member State markets, with no political strings attached.

To say that this would be a high risk strategy is no exaggeration but, in the absence of anything else from Mrs May, it seems more and more likely that this is the game she is playing – relying on the oft' repeated Tory mantra that "they need us more then we need them".

Yet, even now we have run out of time when it comes to providing the infrastructure required to make a hard border work. Thus, if Mrs May is gambling on an EU cave-in, she is taking a huge risk because there is no fall back on which she can usefully rely.

Here, Mrs May might be wise to take note of the old adage about gambling: never stake more than you can afford to lose. Betting the farm on one wild spin of the wheel doesn't seem the brightest thing she can do.

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