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Say No to Norway
19 Jan, 2019

But the Fjords are great

London4Europe Committee member and former HM Treasury senior civil servant Michael Romberg remembers fondly his Norwegian holidays – and comments on Brexit options. The real lesson from this debate is for the Remain campaign: we have to persuade Leave voters that Freedom of Movement is a good thing.

** amended 27 March to include link to new Richard Corbett article  commenting on the latest version of the proposal and link to the proposal itself**

 Don’t get me wrong. I have enjoyed all my holidays in Norway – the Fjords are beautiful. When I worked in HM Treasury I learned useful lessons from my contacts with Norwegian officials. But Norway Plus is no way forward for the UK.

Norway for now

The daftest proposal, now largely abandoned, was that we should temporarily join the EEA. 

Think what the option assumed about Norway, Iceland and Liechtenstein. They would go through all the hassle of onboarding us; they would have us as a disruptive member while we sorted out our new FTA with the EU; then they would have all the hassle of Brexit Mark 2.

The insouciant assumption of the Brexiters that of course Norway & co would put up with all that just to please us is staggering.

Norway (Plus) for ever

It used to be quite a popular option amongst Leavers. Here is Nigel Farage on Question Time in January 2013:  “I have to say that everybody from David Cameron to half this panel say, ‘Wouldn't it be terrible if we were like Norway and Switzerland?’ Really? They're rich. They're happy. They're self governing.” (full broadcast; extract). But by the time of the referendum campaign he was no longer supporting the EEA option. That campaign was so incoherent that there were others who were pushing for the Norway model, eg EFTA4UK but one could not claim that was a dominant voice.

It has now been resuscitated by Nick Boles MP & Stephen Hammond MP in the Better Brexit campaign. The most recent iteration is in the March 2019 “Common Market 2.0” by Lucy Powell MP (Labour & Co-operative) and Robert Halfon MP (Conservative) which calls for Norway Plus, the Plus being a customs union with the EU customs union.

Being outside the political structures, CAP and Fisheries Policy but retaining the economic advantages of single market membership and a customs union appeals to the false idea that we only ever joined a common market.

But the proposal does not really work

Being outside the formal structures of the EU would appear to restore some of our sovereignty. But it would reduce our effective sovereignty as we would have to accept decisions made without us in the room – no matter how much one dresses up the consultation mechanism.

Even this bullish article by the President of the EFTA court says “As a rule – but not always – the EFTA Court follows relevant ECJ case law”.

Nor would those decisions just be those about the single market. In practice for solidarity and national security we would wish to follow the EU’s decisions on political sanctions, say.

More problems with the proposal are in the annex. In addition, Richard Corbett MEP and former national European Movement Vice-Chair provided a detailed commentary on Common Market 2.0 here.

No useable emergency brake on Freedom of Movement

Particularly disingenuous is the claim that the EEA rules on freedom of movement would allow us to pull the emergency brake. Only Liechtenstein has ever done so on freedom of movement. The circumstances of a country with a population of 38,000 hardly offer a relevant precedent. Moreover, the EEA treaties contain a retaliation clause.

Why Norway is not the grown-up compromise

Norway as compromise might have had some traction in Autumn 2016 if there had been a national debate on options. But as is often the case with revolutions opinions have polarised.

The Norway Plus proposal could not work as a compromise because in reality it offers freedom of movement as now and nothing has been done to persuade the public of the merits of freedom of movement. There is no point in just assuming that hostility to freedom of movement has gone away. It hasn’t.  The country is pretty evenly split on the relative importance of maintaining frictionless trade and controlling EU migration (another chart here).

More fundamentally, why bother? If you are going to be almost in the EU you might as well be in the EU and have a seat in the Council and the Parliament.

Lessons for the Remain campaign

Norway Plus is undermined by lack of support for freedom of movement. That is the real lesson for the Remain campaign. If we are to campaign for the UK to stay in the EU we have to campaign for Freedom of Movement. Caroline Lucas MP (Green Party) is good on this point.

Moreover, we cannot honourably campaign for some reformed freedom of movement because it’s not coming and we cannot deliver it. We cannot even campaign for the UK to apply the rules more rigorously because most of us do not really believe we should and because we cannot deliver that either – only the political parties who would form a government can.

Nor should we campaign on the benefits of freedom of movement for people like us (Erasmus for students, businesses and villas in EU27); we have to campaign on its benefits for Leave voters. They are the ones whose minds we have to change.

Conclusion

Norway Plus is a distraction. The only choices are no-deal, the Government’s deal (which is essentially the same as Corbyn’s) or Remain. Let’s get on with having that debate.

To win on Remain we have to win on freedom of movement.

 

 

 

 

ANNEX: MORE TECHNICAL PROBLEMS WITH “COMMON MARKET 2.0”

Politics

In spite of the enthusiastic quotes in the leaflet from some Norwegians &c it is not actually clear that either EFTA or the EU would be quite as keen on the proposal as the paper suggests. Norway Plus is not an existing model that we can just slot into. That does not mean they would veto it. But it would not be the effortless negotiation its proponents suggest.

The paper offers some supportive referendum campaign quotes from Leave campaigners. However, they were either said well before the campaign (as in the Farage quote above) or have been disputed by the campaigners.

Polls suggest that a majority of MPs do not think that staying in the single market honours the referendum result; they are divided half and half on staying in a customs union. Both main party leaders are dead set against freedom of movement. So it is not clear that Norway Plus would have majority support in the House of Commons.

Trade Agreements

The proposal is confused over Customs Union membership. If you are in EFTA you cannot be in a customs union with the EU Customs Union. Instead you have to accept the EFTA FTAs. But to have frictionless trade with the EU and to avoid a hard border in Ireland the UK must be in a customs union with the EU Customs Union. That means that the route to Norway Plus cannot be EFTA – a bit pointless to propose as the paper does a derogation. Rather, the UK would need to negotiate its own pillar of the EEA agreement.

Moreover, although the paper recognises that the UK has to be in a customs union with the EU to resolve the Irish border it asserts as a long term aim that the UK should sign its own trade deals. How are those apparently contradictory statements to be resolved? “technology” is the paper’s answer which is hardly convincing.

Comparison with EU membership

A UK EEA pillar in turn would have implications for issues like the size of the budget contributions. The claim that they would be halved should be assumed to be as optimistic as all Brexiters’ claims.

The plan boasts that we would be outside judicial and home affairs co-operation structures. But even Theresa May wishes to retain the European Arrest Warrant and other forms of policing co-operation.

The claim in the paper that Common Market 2.0 would “not in any way constrain State Aid” is contradicted later by the statement that EU state aid rules would apply. The reality is that several EU countries have nationalised industries and much higher levels of state aid than the UK does. State aid rules provide protection against multinationals demanding corporate welfare. Labour has not articulated a policy that actually requires freedom from EU State Aids rules. EU State aid rules are irrelevant to the case for Brexit.

 

 

 

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