The UK and Brexit: The aftermath – and the questions

Written by on June 25, 2016 in Perspectives - Comments Off on The UK and Brexit: The aftermath – and the questions
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OK, so the UK has decided to leave the EU. Why?

There have only been three core reasons to leave. Political Accountability, the Economy and Migration. Both sides agreed that the EU has a serious democratic deficit, primarily in the Commission.

However, they both accepted that this would not be enough for an understandable argument for the general voter. They then evolved into Remains’ Project Fear (the Economy), and Leave’s Project Hate (Migration).

It seems that hate triumphed over fear. I am not surprised. Now for a broad brush, but sadly true statement. “A large and vocal proportion of British (and English in particular) simply do not like foreigners, foreign languages, or for that matter anything foreign”. They will tolerate foreigners if they feel it is in their immediate interest, but that tolerance is very limited.

The EU, being an organisation full of foreigners, talking about foreign issues, and in foreign languages made them very uncomfortable. This dislike of foreigners was so strong, and so ingrained, that even the real risk of economic meltdown was a price worth paying to keep those Europeans out. [The British have never regarded themselves as part of Europe].

What effect will this have on the UK economy?

It will certainly have an immediate and negative impact on the UK economy.

How much of an impact, is not something that can be foreseen with any element of certainty. The major companies in the UK all have operations within the EU, so relocating their governing head offices and country of taxation will take but a stroke of a pen.

The longer-term issues will equally depend on; negotiations with the EU, the decisions of the government of the day, International ratings agencies, the IMF, the WTO, and of course how quickly the UK can chart a new course in response to the fore mentioned. The short answer is “nobody knows”; but global traders and markets do not like uncertainty.

Will leaving the EU allow the UK to completely control its own future?

Yes, most certainly. However, there are some caveats to this.

The UK is party to a number of multi-national treaties that affect government policy and decisions. Membership of Nato, the UN, The World Trade Organisation, to name only three directly impact on national policies.

That said, of course such future decisions would be made by the UK and its elected government, and not by any external body.

Will leaving the EU solve the immigration issues?

Not really. While in the EU, the UK could have drastically reduced the numbers arriving from outside of the Union, these comprise more than 50 per cent of all immigrants, they did not do this then, and there is no reason to think they will do this in the future.

Those already in the UK may remain if they wish, and their best-case scenario would be minor limitations relating to EU citizens. In my opinion the Union should let them do whatever they want; then conversely make it clear that British citizens are welcome to come, live, work, pay taxes, and spend in the EU.

Will the UK leaving be the beginning of the end of the EU?

The departure of the UK will generate some serious revision of how the Union is perceived by the citizens of member nations.

It is clear that there are problems, and with an elected parliament that cannot make, change, or even cancel laws is a seriously flawed system.

The most reviled and undemocratic element is the Commission. Unelected, almost un-removable, and subject to no realistic democratic oversight. These any many other issue will need to be addressed if the EU is to revitalise support from its citizens.

Will the UK retain its current free trade arrangements with the EU?

In a word, NO. There are a number of options available but none of them would be ideal for the UK and none would be “Free” Trade.

For the EEA route the UK would continue to accept free movement of people, follow EU regulations and pay into the EU budget (the Norway option); not a realistic option – else why leave?

For the WTO Route then all trade would be under those rules, and tariffs may be imposed up to a specified limit. So not total free trade.

The “Most Favoured Nation” route. Here there would also be limitations on what is free of tariffs and indeed what areas of trade this actually covers. It would also take years of negotiation and political bargaining.

It would not be in the interest of the remaining 27 member nations to allow absolute free trade to the UK, without the UK following related EU regulations, allowing limited free movement, and paying something for the privilege.

There is much talk about the UK buying more from the EU than it sells, and as such is a market the EU would not wish to lose. Well, that is true, but only up to a point. After all the aim for most nations, like good companies, is to sell more than it buys, which the UK does not.

How much will the UK ‘Save’ by Leaving the EU?

The UK does indeed pay in more than it gets back by 6.6 billion pounds sterling a year. On that issue I do not know of any club or organisation that guarantees members will ALL receive more than they contribute.

However, what exactly are we talking about? Well that would be about 0.016 per cent off Income Tax; or 12 days’ worth of the National Health Service Costs.

But it gets more complicated.

The Leave campaign made it absolutely clear that the UK will continue with funding its part of the UK element of CAP, and other ongoing projects, so the public will register no change in these areas.

They have also promised that this extra money will also be used to revitalise the fishing industry (1.6 billion); Steel Industry (2.1 billion); Enhanced border controls at all entry points (0.5 billion); Increasing repayments of the national debt (3 billion); Increasing housing stock (0.7 billion); and reducing VAT on energy bills (0.6 billion). So if they keep to their plans, then Leaving will cost more.

Will Turkey join the EU?

Complicated area and not as simple as either side would have us believe.

Leave stated they will join, and for some reason all 70 million Turks will immediately head for the EU. Remain stated that Turkey will not join in the foreseeable future as instead of moving towards convergence with EU principles, they are moving away.

In addition, there are a number of member nations who would certainly veto any such enlargement. Even for those who are not anti-Turkish, the idea of having an EU external border with Syria and Iraq is simply not something they want to contemplate.

Could the UK leaving be an incentive for change within the EU?
It is fairly likely that there will be change on the lines of current thought, voiced by a number of member states, the parliament, and feedback from the population in general.

Indeed many senior officials have stated “If we were starting the EU today, this is not how we would have proceeded”.

What changes have been proposed, that have the support of most member nations?

There have been many proposals for serious change to how the EU is operated. Those that currently have the support of parliament, a majority of national governments, and indeed officials of the EU itself are:

Council of Ministers
The Council of Ministers is not elected by EU citizens, but by citizens in their own individual country, and many by a minority of those. Their role will be changed to that of a “Collective Head of The EU”. The Council will be supported by a non-voting “President” who will be the physical representative of the Council and the EU itself, and who will manage the operation of the Council. The President will be the only individual within all EU governance to hold that title. The Rotating Presidency Trio will become the “Proposing Committee of the Council”, the “Chairperson” and members will rotate as previously.

The Parliament of the European Union
The elected Parliament alone would have the power to make, vary, amend, or cancel all EU laws and regulations. This is subject to a majority veto by the Council of Ministers, and this veto can be overturned by a two thirds majority vote in Parliament. The Title of President of the EU Parliament will change to Speaker, Moderator, Chairperson, or some other title except President. The post holder will not usually vote on any issue, other than when the parliament is tied. At that point they must vote for “No Change” on the issue in question, and put it back before parliament.
Any law, regulation, order, or other issue that would by its nature or substance automatically become law in all member states, without the need for ratification by national governments, must be passed by a two thirds majority. These may be overturned by an absolute unanimous vote by the Council of Ministers.

The Commission of the European Union
EU Commissioners to be elected by parliament, from the elected body of the parliament. National quotas will remain. They are all collectively and individually subject to the will of parliament. They in effect become the elected heads of their respective Commission department. Their parliamentary place will be taken by the runner up in the respective national elections for MEP’s.
The EU Commissioners elect from their own number a “Chairperson” to manage and regulate the Commission as a whole. This appointment is subject to parliamentary approval.
The Commissioners, and all related departmental staff are in all matters regarded as the Civil Service of the EU. Staff may not make any public or political statement. Commissioners are accountable to parliament for all and any actions they may take.

The issue of “Ever Closer Union”

This phrase is meaningless unless placed in a specific context, which it is not. The use of the word “union” in the context of a treaty relating to the European Union, could and has, given rise to an understanding by some of a United States of Europe. It is abundantly clear to the vast majority of EU national governments and citizens that this is not wanted, is not something they would agree to, and is a direct threat to their national identity. It has been suggested that this be removed from any future treaty, or be amended to state “Ever Closer Association”.

Common Agricultural Policy (CAP)

The cost of membership for every member nation is rising, and at a rate greater than EU inflation. If the EU wants to retain current spending levels, then every member will have its contribution increased by c.9 per cent to cover the loss from the UK.

The main target for questioning current fiscal policy is the CAP. Agriculture and its related commercial spheres accounts for 34 per cent of the EU budget.

However, it is pointed out that this same sector is responsible for only 18.5 per cent of EU GDP, and only nine per cent of exports.

It is of course a form of subsidy to the industry, but on a scale that is simple not permitted under EU law for any other economic sector.

There are many arguments that can be put forward in support of this, but even its champions question the logic that 12.3 per cent of this budget is spent on paying farmers to grow nothing.

Additionally there is an argument that such protectionism from non-EU food sources has, in itself, by isolating “third world nations” from the market, contributing to the current migrant crisis.

Free Movement of Citizens

This is an integral part of the EU, and as such requires more clear definition.

I see no problem with retaining the primary right of free movement, but with certain caveats where such movement relates to working or receipt of social payments. There has to be some restrictions regarding “benefit tourism”, and likewise if a citizen is travelling to work, then they must have a limitation regarding the time allowed to obtain employment.

Indeed the earlier proposed opt-outs for the UK should become the universal practice within the EU.

Migration Crisis and External Immigration in General (Excluding Asylum Seekers)

I think it reasonably fair to state that the EU as a whole has made a complete Pig’s Breakfast with this entire issue.

Firm and difficult to negotiate rules (The Dublin Agreement) are ditched unilaterally by various member states, with no repercussions.

The migration crisis evolved over a matter of weeks, and the EU take action over months; wondering why none of their plans are working. The problem was mishandled by the Commission from the very start; indeed many believe this was because the Commission viewed the crisis as ‘beneficial’ to their own waning authority. They did indeed appear more interested in EU power politics than actual crisis management.

Recent new member states had to wait years for their citizens to have total free movement and work within the EU, while migrants from North Africa and elsewhere get a free pass by stepping over a border line.

Border nations such as Bulgaria and Hungary apply the Dublin Agreement in full, and police their borders accordingly, which in turn protects the internal borders of the EU. They are promptly chastised for being “too strict”. Requests for some limited financial assistance are accepted, take over a year to be paid, and then less than was promised.

Germany, without consultation, tells the migrants they are welcome, but does nothing to support their movement to Germany. After a few weeks they change their mind and everyone else has to fix the now larger problem.
The European Court of Justice now say that illegal migrants cannot be arrested and detained!! You simply could not make this up.

There are rules and procedures for non EU citizens to apply for entry. These must be adhered to. The EU does not say “no migrants” indeed quite the opposite, but if migrants cannot abide by the rules for entry, the question then becomes “will they abide by any other laws and rules once in”. Illegally entering the EU is an offence. No offence can be either condoned or more importantly, rewarded.

If one wishes to view the EU as a collective form of governance, then the first duty of any government is the protection and wellbeing of their citizens – not some other nation’s citizens. Humanitarian elements must be taken into account, but at the end it is simple “This is our home, and we will decide who we allow in, and for what reason”.

What about the UK citizens living and working in the EU in general and Bulgaria in particular?

In general they are protected by the Vienna Conventions regarding Treaty Change or Cancellation.

Simply put, those individuals (not necessarily corporations or other legal entities), that have clearly established themselves in another country as part of, or under the rights permitted by a Treaty may retain all rights, privileges, and obligations they previously enjoyed should the Treaty be cancelled or amended with regard to their parent nation. This Convention is an integral part of EU law.

Sounds simple, but the key words are ‘Clearly Established’. What does this mean? Like most international agreements it is suitably vague and deliberately so. Numerous leading international lawyers come to somewhat differing conclusions, but do agree on some core elements that would cover the phrase.

In relation to UK citizens currently in Bulgaria this would likely be:
– You and your family, resident in Bulgaria are ALL full UK citizens.
– You have a Residence Permit (preferably but possibly not essentially ‘’Permanent’)
– You own, or long term rent a residential property in your own name. – Crucially, not in the name of a Bulgarian company in which you are simply the registered owner. (Company ownership provides no right of residence).
– You are registered with the local and national Tax/Health/Pension authorities, and pay such sums as required, up to date and on time.
– You do not have a criminal record.
– Within any 12-month period, you spend more than 181 days in Bulgaria, and no absence period is longer than 90 consecutive days. (This may possibly not apply to those who are ‘Permanent’ Residents).
– If employed it is under a legal employment contract; if self-employed you comply with all the requirements of registration and taxation; if retired you have an income equal with, or greater than the national minimum wage.

To be very clear, ALL of the above would most probably be required, and this is simply the general legal view. The EU and Bulgarian authorities may well have a different interpretation. Time will tell.



About the Author

The author is a UK citizen, who lives permanently in Bulgaria. Although pro-EU, he is not blind to the need for some serious reform in its institutions.