A few weeks ago we covered the legal nuances of alternative arrangements to financial passporting. This week we talk to another legal expert about the wider picture. Thom Brooks is professor oflaw and government at Durham University, and head of Durham Law School. He advised the Labour Party at the last election, and played a key in persuading the Electoral Commission to adopt the "Remain" / "Leave" wording on the EU Referendum (instead of the "Yes" / "No" originally proposed). His particular specialism is on immigration law, clearly a hot topic, both during the campaign and now.
Shortly after the referendum Professor Brooks made headlines when he declared that "Brexit will never happen". Of course, he emphasises that he didn't mean this literally Britain will still give up its membership. However, he notes that many of the promises that the Leave campaign made (such as the £350m a week for the NHS) won't be fulfilled. He also notes that even the Conservatives want to preserve some of the institutional arrangements we currently benefit from.
The most obvious of these are those governing counter-terrorism and security. At the moment EU membership allows us to receive preferential access to intelligence, including material that even the United States is not allowed to see. Another agreement that the UK would want to see preserved is the Dublin agreement on asylum and immigration. This means that refugees have to claim asylum in the first safe country they arrive in, rather than being able to wait until they reach the UK.
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He also thinks that, "there is definitely going to be a transitional period". He notes that even hard-Brexiteers, such as Iain Duncan-Smith and David Davis, have accepted that it will take years for a final trade deal to be hashed out. While Theresa May still insists that things can be done within the two years allowed by Article 50, Brooks says "the Canada deal took a lot of time to agree", so both sides could be in for a long wait. Indeed, he thinks that even agreeing the general principles will take a year, with the "nuts and bolts" of any deal taking much longer.
One big theme that we've detected from business leaders, including those who supported Brexit or think that it could benefit them, is that they are worried about the status of their EU national staff. Brooks agrees that this is a "massive issue". In theory, the rest of the EU is happy to agree a deal where both sides guarantee the status of each other's nationals. However, while "the government has the power to end the ambiguity right now" Theresa May is currently stalling, so the issue lingers on unnecessarily, in his view.
Another issue is the issue of the Common Travel Area the right of Irish citizens to move freely between the UK and Ireland without having to pass through border controls. Sadly, Brooks thinks that "there will have to be changes" to how such arrangements work. The problem is May's insistence on leaving the customs union, which puts a "severe strain" on the arrangement. (This is because if there aren't any border checks, the Irish border could easily become a route for smuggled goods from non-EU countries that Britain has a trade deal with).
Brooks also notes that the EU knows how important the CTA is to the UK and could use it as a bargaining chip, if it was so minded. After all, Brooks points out that "they can justifiably say that the whole problem has been created by Britain's voluntary decision to leave the single market and the customs union". It goes without saying that a hard border between the two countries "would certainly not be beneficial for either the UK or Ireland".
So what model does Brooks support? Give the Conservatives' stated objectives he would suggest that they try for a Swiss style agreement, which is slightly removed from the single market, but preserves many of its benefits. Such a model is suited to the increasing amount of regional and local devolution. Labour's manifesto implies that they would be more open to a Norwegian style agreement, which gives almost complete access to the single market (though even Norway chooses to be outside the customs union).
Brooks emphasises that even under the current arrangements it is possible to restrict freedom of movement to a certain degree. For instance it is possible for Britain to deport those who have been unemployed for greater than a set period of time and are not self-supporting. However, if the government really wanted to crack down on people who were abusing the system, it would have to either bring in ID cards or get GPs and landlords to function as part of the immigration system.
In terms of whether the "divorce bill" that the EU is demanding from Britain is serious or just a bluff, Brooks thinks that it "is a bit of both". However, he is clear that EU membership is not like being a member of a video club or Netflix, "where you can just turn in your card and walk away". Instead, a better analogy would be partnership in a firm. In return for "a seat on the board" the UK "accepted the principle of collective liability", and so will have to pay something. However, the exact amount will eventually end up being negotiated down.
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Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
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