Why we need to leave the single market

(The following article is a full, significantly extended, revised and updated version of a much shorter article which I wrote for the “Comment Central” website which was, in turn an extended version of a 952-word article which I wrote for the “Student Voices” website in July). According to the EU’s treaties, there is no such thing as the “single market” – there is only the “internal market” and so I prefer the term “internal market” and will only use the term “single market” when quoting others.

I originally thought that Theresa May’s Lancaster House speech in January (transcript here), her letter to the President of the European Council, Donald Tusk, invoking Article 50 of the Treaty of Lisbon (here) and the Government’s Brexit White Paper (here) had once and for all nipped the idea of continued internal market membership after Brexit in the bud. However, since the Conservatives lost their parliamentary majority in the General Election this year, it seems to have raised its ugly head once more. Since then, 101 MPs voted for Chuka Umunna’s amendment to the Queen’s Speech which, if passed, would have caused the Government to guarantee the UK’s continued internal market membership after Brexit before the Brexit negotiations even began. Thankfully not a single Conservative MP voted for the amendment, not even Anna Soubry or Ken Clarke who were both strongly opposed to Brexit and who now say that they strongly support our continued membership of the internal market after Brexit. Conservative Anna Soubry and Labour’s Chuka Umunna have set up an All-Party Parliamentary Group on EU Relations which includes MPs from all parties, many of whom support continued internal market membership after Brexit. Many members of their group, especially Umunna, Soubry and Labour’s Stephen Kinnock, are trying to force the Government to give Parliament a specific vote on whether or not we should remain members of the internal market after Brexit.

It seems to me that there are three main reasons why we must not remain internal market members. Firstly, it would be legally impossible for us to seamlessly remain members of the internal market after Brexit. Secondly, all of the leading remain and leave campaigners clearly stated throughout the campaign that a vote to leave the EU would necessarily also mean leaving the internal market and that the leave campaign had made it clear that they supported our exit from both the EU and the EEA. Thirdly, if we don’t leave both the EU and its internal market, we will not be able to truly deliver on the will of the people as expressed in the EU referendum and as we won’t be able to capitalise on all of the advantages of leaving the EU. These advantages are that we will have full, permanent, independent and democratic control of our laws, our regulations, our money, our borders and our trade policy.

The Prime Minister said on the Andrew Marr Show that the German Finance Minister, Wolfgang Schaeuble had made it clear that upon a vote to leave the EU, the UK would have to leave both the EU and the EEA. Schaeuble also said “If the majority in Britain opt for Brexit, that would be a decision against the single market. In is in. Out is out”. Since the referendum, the President of the European Council has made the same point. He said there is no hard or soft Brexit – either you leave both the EU and the internal market or you don’t leave the EU at all. The only way in which we are currently a member of the internal market is through our membership of the EU. Before we joined the EU, we were not members of the internal market. Therefore, it logically follows that, after we officially leave the EU (at midnight on 29th March 2019 – two years after the invoking of Article 50), we will no longer be members of the internal market. Robin Walker MP confirmed this when he was Parliamentary Under-Secretary of State for Exiting the EU when he said that the “EEA Agreement will automatically cease to apply” two years after the invoking of Article 50 (at midnight on 29th March 2019). Even the Chancellor of the Exchequer, Philip Hammond (who has been nicknamed “remainer Phil” since the Brexit vote) also confirmed this in June when he said “When we leave the European Union we will leave the single market and the customs union. That’s not a matter of choice; that’s a matter of legal necessity”.

Only countries which are already members of either the EU or the EFTA (the European Free Trade Association) can become new members of the internal market and this is shown in the fact that all 31 members of the internal market are also either members of the EU or the EFTA. However, on 1st April 2019, we will NOT be members of the EU or the EFTA. It could take months for us to apply just for EFTA membership and then, through that, EEA membership and a government minister in Norway has said that Norway may veto an application from the UK to join the EFTA after Brexit. It would therefore be legally impossible for us to seamlessly remain a member of the EEA after Brexit, even if voters wanted this and opinion polling suggests that they don’t. In August 2017, a survey by the University of Oxford and the London School of Economics has shown that 68% of voters prefer a “hard Brexit” to a “soft Brexit”. This has significantly increased since October of last year, when YouGov poll showed that 47% of all voters support leaving both the EU and the internal market, compared to only 39% who support leaving the EU and remaining within the internal market. A YouGov poll from 16th January this year showed that 74% of leave voters support our exit from both the EU and the internal market.

It would be absurd for Parliament to hold a vote on whether or not we should remain members of the internal market after Brexit as, if they voted for it, they would be asking the Government to do something which is legally impossible. Even Dr Richard North (the author Flexcit plan for Brexit), EFTA4UK (@EFTA4UK) and Liberal Leave (@LiberalLeave), all of whom strongly support internal market membership after Brexit, have all admitted that it would be legally impossible for us to seamlessly remain internal market members after Brexit and that, after Brexit, we would first have to join the EFTA before we could become internal market members. They all accept that, due to the fact that Article 50 has already been invoked, we will have to leave both the EU and the internal market at midnight on 29th March 2019 and that we would then have to join the EFTA and then, through that EFTA membership, eventually acquire internal market membership. These people and groups then proceed to say that we must therefore leave both the EU and the internal market in the immediate term but then rejoin the internal market via EFTA as quickly as possible – with some saying it will take just 6 months to a year to do so. However, it is widely accepted that it would take months just for us to join the EFTA, never mind the internal market as well. Furthermore, even Pete North (a close relative of Dr Richard North) has admitted that rejoining the internal market via EFTA would be a “major legal undertaking” which could take up to “five years”. Suddenly changing tac now and declaring that the UK wants to stay in the internal market would contradict the Lancaster House Speech, the Article 50 letter and Brexit White Paper and render useless almost all of the Government’s planning and preparation for Brexit.

According to the EU’s treaties, there is no such thing as the “single market” – there is only the internal market which just shows that it really is an inherent and intrinsic part of the EU and that, if you leave the EU but don’t also leave the internal market, you haven’t really left the EU. On television in the referendum campaign the remain campaigners Ruth Davidson, Hillary Benn, Nick Clegg, Sajid Javid, Angela Eagle, Rachel Reeves, George Osborne, Lord Mandelson and David Cameron and the leave campaigners Michael Gove, Boris Johnson, Andrea Leadsom, Lord (Nigel) Lawson, Lord (Norman) Lamont, Lord (David) Owen and Nigel Farage (watch here and here) and many others made it clear that a vote to leave would mean leaving the internal market.

On YouTube, Channel Brexit has uploaded an excellent 6-minute video (watch here) of leading remain campaigners and leave campaigners all clearly stating during the referendum campaign that, in the event of a vote to the leave the EU, we would have to leave both the EU and the internal market and that, in the words of remain campaigner Sajid Javid MP, “The Leave campaign have admitted: they would take us out of the single market”. David Cameron mentioned the fact that we would have to leave both the EU and the internal market in the event of a Brexit vote 27 times in his Sky News interview and question session alone. He even said “I keep going on about the single market but it is so important” and that “one of the most important moments of this campaign was when the out campaign said they wanted to leave the single market”. Jacob Rees-Mogg has pointed out that “within the campaign it was stated very clearly that once we left we would need to negotiate a free trade agreement with the European Union. There would have been no need to do that if we remained in the single market”. The House of Commons and the House of Lords both effectively approved a clean Brexit (an exit from the EU, its internal market and its customs union) when they voted in March of this year to invoke Article 50 two months after the Government had laid its Brexit plans which included leaving the EU, its internal market and its customs union.

Even the Labour Party who on Brexit, and certainly with regard to the so-called “Great Repeal Bill” (European Union (Withdrawal) Bill), seem to be determined to provide opposition merely for opposition’s sake, now support our exit from both the EU and the internal market. The Labour Party’s manifesto clearly and strongly implied that the party supports our exit from both the EU and the internal market as it stated on page 24 that the party’s strong focus is on “retaining the benefits of the single market” which obviously suggests that they support leaving the internal market but retaining as many of its benefits as is possible from outside of the internal market. The manifesto also said on page 28 “Freedom of movement will end when we leave the European Union” which also implies Labour’s opposition to continued internal market membership as the freedom of movement of people is contained within the EEA Agreement which all internal market members are signed up and are bound by. On page 30, the manifesto says “as our trading relationship with the EU changes it is vital that we retain unrestricted access for our goods and services”. If we were remain members of the internal market after Brexit, there would be no change to our trading relationship with the EU and yet the manifesto clearly states that our trading relationship with the EU will indeed change.

The Leader of the Labour Party, Jeremy Corbyn (sacked three of his own frontbenchers when they voted for Chuka Umunna’s pro-internal market amendment) to the Queen’s Speech in June.

In the BBC’s General Election debate, Jeremy Corbyn said “What will happen on leaving the European Union is that we cease to be members of the single market and therefore free movement ends”.

Labour’s Shadow Chancellor, John McDonnell MP, has also made it clear since the referendum when he said “I think people will interpret membership of the single market as not respecting that referendum” and “I can’t even see it [single market membership] being on the table in negotiations […] I don’t think it’s [single market membership] reasonable”.

Labour’s International Trade Secretary, Barry Gardiner, has stated “We will not be members of the single market”. Caroline Flint has also stated this (watch here, here and here) and Labour MP Sarah Champion said the same thing on the Daily Politics on 19th July (watch here at 15:02). The Democratic Unionist Party (DUP), who are in an informal “confidence and supply” agreement with our minority Conservative government, also clearly implied in their manifesto that we would leave the internal market.  Their manifesto says on page 18 that they think that one of the focuses in the negotiations should be on attaining a “Comprehensive free trade and customs agreement with the European Union”. It also states on the very same page that they would like to see an “Effective immigration policy which meets the skills, labour and security needs of the UK” and it is impossible stay in the internal market but to also simultaneously have full, permanent, independent and democratic control of immigration from the EU. The Conservatives, the DUP and Labour together received 83.2% of the national popular vote and 91% of all seats UK-wide in the 2017 General Election and so only 9% of seats in Parliament are held by parties which do not support our exit from both the EU and its internal market.

Leaving the internal market is crucial as even its name alone implies that it is, in itself, an intrinsic pillar of the EU whose ultimate arbiter is the European Court of Justice (ECJ) in Luxembourg. The internal market was specifically designed as a temporary stepping to full EU membership for countries like Norway whose government and political leaders support EU membership but whose electorates do not. Furthermore, the official Vote Leave campaign had a number of key pledges: to take back control of our laws, our money and our borders. We can only do any of these things if we leave both the EU and the internal market. Leave campaigners constantly talked about the internal market being a “single regulatory zone” and argued against our membership of it as it means that 100% of UK businesses have to abide by 100% of the EU’s pedantic, unnecessary and burdensome regulations, even though only 6% of UK businesses ever export to the EU. This burden is particularly heavy for small and medium sized businesses and, in 2010, the British Chambers of Commerce calculated that EU regulations cost UK businesses £80bn in total per year (here and here). If we leave both the EU and the internal market and negotiate a bespoke, independent and bilateral UK-EU free trade agreement, only the 6% of UK businesses that ever export to the EU will have to abide by its regulations. This does not, however, mean that there will be a “race to the bottom” on workers’ rights as the Labour Party like to claim. Only 10% of all EU regulations relate to workers’ rights and they will all be transferred into UK law via the “Great Repeal Bill”. This will ensure that both the UK courts and the International Labour Organisation (ILO) are protected. The vast majority of these rights are already enshrined in UK law anyway and the UK pioneered many of them and passed some them even before we joined the EU. Parliament can then, if it chooses repeal the pedantic, unnecessary and burdensome EU regulations for the 94% of UK businesses which never export to the EU. Only 13% of the entire UK economy is exports to the EU and yet all of the EU’s regulations constantly shackle our whole economy and this would have to continue if we were to remain internal market members after Brexit.

If we were to remain internal market members after Brexit we would still have to pay billions of pounds net into the European budget every year. We would be funding an organisation which we specifically voted against. It would be like Lincoln Chafee donating billions of dollars to the Republican Party today even though he left it way back in 2007 and even though he is now a Democratic Governor.

Opinion polling since the Brexit vote has shown that one of the three main reasons why the UK electorate voted to leave the EU was to end the freedom of movement of people which is, let us not forget, contained within the EEA Agreement which binds together all internal market members. They voted not for a temporary, or even a permanent, emergency brake on EU immigration into the UK but for the UK Parliament to have full, permanent, independent and democratic control of immigration from the EU. They did this for four main reasons.

Firstly, uncontrolled, unsustainable, open door mass immigration from other EU member states into the UK puts and has put unprecedented pressure on school places, housing, the NHS, hospitals, GP surgeries and other public services. Just to keep up with the current level of immigration, a new house has had to be built every 7 minutes. Current levels of immigration increase the UK population by the size of Newcastle every year and England alone has a shortfall of 10,000 primary school places. This is clearly unsustainable and unmanageable. No previous wave of immigration into the UK has come anywhere near the annual 300,000+ net which we have had recently. The second reason was that, as the Bank of England has stated, uncontrolled, unsustainable, open door mass immigration, particularly of low skilled workers from the EU has undercut wages, particularly for those workers who are already the lowest paid and this has become even clearer after the Brexit vote. The third reason was that the system discriminated against people from non-EU countries who often have to go through a much more rigorous process to get here and for whom the numbers are capped while those from the EU have the unlimited right to waltz into the UK as, when and for however long they wish. This was very much seen as a great unfairness and a glaring injustice. The fourth and final reason was to ensure the UK’s national security and to prevent those with criminal records and those who aren’t seeking work from entering the UK. Voters wanted to ensure that those coming into the UK had the skills which the UK economy required and that those without work after 6 months or those committing crimes soon after arrival in the UK could be deported back to their member state of origin.

An emergency brake only allows countries to limit the number of EU immigrants per year. It grants countries no control over immigration with regard to security or skills. It is clearly not full or independent control of immigration which is what the British electorate voted for on 23rd June 2016. Some “soft Brexiteers” such as Simon Barnett (@_SimonBarnett) of EFTA4UK (@EFTA4UK) openly support the freedom of movement of people, have defended it and do not see any problem with the continuation of uncontrolled, unsustainable, open door mass immigration after Brexit. Barnett’s view is clearly in the minority as even the majority of remain voters now want free movement to end.

Many soft Brexiteers continually tell us that it is perfectly possible to control immigration while simultaneously remaining a member of the internal market. They state that we could simply unilaterally invoke Article 112 of the EEA Agreement and that we would then have control of EU immigration. This is a gross oversimplification. The UK could unilaterally invoke Article 112 but the EU reserves the right to reject our application for an emergency brake. It’s worth bearing in mind that, in his so-called “renegotiation” of the terms of our EU membership, David Cameron set out to attain an emergency brake on EU immigration but was refused such a brake. I highly doubt that the very same people who refused us an emergency brake only last year with an upcoming in/out referendum on our EU membership will suddenly turn around now that we’ve left and offer us such an emergency brake. This was shown when, in the aftermath of the announcement of the EU referendum result, German Chancellor, Angela Merkel, and the then French President, Francois Hollande, offered the UK a 7-year emergency brake on EU immigration in return for our continued membership of the internal market after Brexit but the arrangement was vetoed by the President of the European Commission President, Jean-Claude Juncker (read here and here).

Liechtenstein’s process of controlling EU immigration over the years has been anything but simple, straightforward or unilateral. In the words of the BBC’s Business Editor Helen Thomas “How Liechtenstein ended up in this special situation isn’t entirely straightforward. Originally, back in the 1990s, it negotiated a side deal with the EEA, allowing it to impose restrictions on immigration. Later it invoked something called Article 112 or safeguard measures, effectively allowing those restrictions to continue. Later still, it negotiated a change to the agreement, establishing its quota system”. Josephine van Zeben, an Oxford University Fellow in EU Law, has said “There’s absolutely no reason to believe that the EEA members would give a concession such as this one [an emergency brake] to the UK, given that its demographic, social and economic situation are so different”.

Even the current Prime Minister of Liechtenstein, Adrian Hasler, has himself said said “I think nowadays it would be impossible for Liechtenstein to realise such a solution. Twenty years ago, it was different but I think when would we today negotiate such a solution, it wouldn’t be possible […] free movement is one of the pillars of EU”. The leaders of the EU and of France and Germany have constantly told us both before and after the referendum result was announced that the four freedoms of the EU (of goods, capital, services and people) are indivisible. This was also reinforced when the Swiss voted in a referendum to introduce quotas on EU immigration into the Switzerland in 2014. Since the result of that referendum, the Swiss Government has completely failed to achieve any concessions whatsoever from the EU on immigration. Even Chuka Umunna has (watch here at 11:38) admitted that the freedom of movement of people is “definitely an issue” with a “soft Brexit”.

Therefore, it is clear that the UK must leave both the EU and the internal market and negotiate its own independent, bespoke and bilateral free trade agreement with the EU. This approach is entirely realistic and I explain why in my Guido Fawkes-listed article which has been re-blogged by The Conservative Online here, retweeted by Conservative MEP David Campbell-Bannerman (@DCBMEP) and shared by BrexitCentral (@BrexitCentral), the Bruges Group (@BrugesGroup), Conservatives for Liberty (@con4lib), the Libertarian Party UK, Parliament Street (@ParlStreet) and 215 others.

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