By Flora Hutchings,
Best for Britain's Head of External Affairs
In recent weeks, we’ve had a barrage of brutal reminders about the importance of being prepared.
Shortages of vital equipment, panic buying, confusion and anger resulted globally as Covid-19’s tentacles took hold and squeezed.
Some were better prepared than others. Wimbledon’s organisers – the All England Lawn Tennis and Croquet Club – took out £1.6million-a-year pandemic insurance back in 2003, in response to the SARS outbreak.
As a result, they are expected to receive a £114million payout – hefty, but still less than half the £250million revenue they forecast from this year’s tournament.
Risking a red face
Those who heed warnings tend to trade short-term losses for long-term security. The losses may be financial – insurance costs, increased spending on key areas – but they may take other forms as well.
Loss of face is one such challenge. That £1.6million Wimbledon insurance premium represents 4 per cent of the All England Club profits and, if you are responsible for signing that off, year after year, it’s not inconceivable that you might take some heat over the bill, particularly in an organisation that isn’t as good as Wimbledon at playing the long game.
One group of people who can, understandably, struggle with the long game are politicians. MPs have a limited window in which to make a difference and, lest we forget, secure re-election.
To put that in context, Wimbledon’s pandemic insurance has run from Blair through Brown, Cameron, May and up to Johnson before any payout. If, like Wimbledon, the Treasury was taking a 4 per cent hit every year for no obvious benefit, you can see how political pressure might build.
Get shorty
We are seeing the challenge of short-termism right now when it comes to negotiating Britain’s messy divorce from the EU.
The Government, which has pledged to cut our formal European ties by December 31st, sees short-term political risks in any delay. Given Brexit’s toxicity, they have a point, certainly when it comes to those on the most pro-Brexity end of the spectrum.
But there are other voices, groups who see both short and long-term challenges from sticking to that December deadline, while the world is paralysed by Covid-19 and our own political leadership is laid low by this invisible menace.
In for the long haul
This group includes people who make stuff, people who grow stuff, people who transport stuff, people who have to deal with the fallout from a badly-executed deal … a lot of people and organisations.
For example, hauliers are particularly concerned, as well they might be, given the widely-discussed problems they could face at borders with even a well-managed withdrawal from European agreements.
The Road Haulage Association, the Freight Transport Association and the British International Freight Association have all called for an extension, and not just in recent days.
Last month, RHA chief executive Richard Burnett wrote to the Government to warn that the industry was already “…not in a position to give the complexity of future trade arrangements with the EU the necessary focus”, adding that the present situation made “the ability to agree and manage new trading arrangements impossible”.
The RHA has been careful not to take sides in the debate over Britain’s relationship with Europe, and has given its endorsement to Government plans on the issue – apart from the December deadline, which only goes to show just how serious the extension issue is.
For whom the alarm bell tolls
Of course, there is huge political pressure to extend the transition period, reflecting the concerns of voters and businesses across the country and, indeed, beyond.
The list of those calling for extension includes some high-profile Brexiteers – political journalist Isabel Oakeshott, for example, tweeted a very sober take on the situation, writing: “I now think it is inevitable the Brexit transition period will be extended and as a Brexiter I am cool with this. The corona catastrophe changes everything. We have enough to deal with.”
We do, indeed, have enough to deal with. That is why the devolved governments in Scotland and Wales want a delay – the Scottish government has called for a two-year extension – opposition parties agree and new Labour leader Keir Starmer believes making the December 31st a legal requirement was a mistake.
In Europe, the European People’s Party (EPP) – the largest group in the European Parliament – has urged Britain to request an extension.
There is simply not enough time to prepare for withdrawal from the EU while Britain, Europe and the entire world is hyper-focused on controlling Covid-19 and then dealing with the fallout – economic, social and emotional.
Withdrawal negotiations have pretty much ground to a halt, with discussions being held about how best to hold discussions.
But these are the rules, fools
Formally, the UK and the EU are in a transitional period until at least December 31st. That can be extended to 31st December 2021 or 2022 if the UK requests an extension before 30th June 2020. In other words, we have less than three months to act, in the midst of a global crisis.
Without further legislation, it would be illegal for the Government to extend the transition period – that was written into the Withdrawal Agreement Act. This could, however, be superseded by a new Bill, assuming it could attract majority support in Parliament.
A decision to extend transition would be taken via the UK-EU Joint Committee, which is tasked with overseeing implementation of the Withdrawal Agreement.
That committee has joint chairs – Michael Gove, for the UK, and Maroš Šefčovič, a European Commission vice-president. Either side could request an extension, or both could agree without a formal request – an exchange of letters would suffice.
Do we really need to delay?
In a word, Yes. For example…
• Negotiators cannot meet face to face and, even in the age of Zoom, this is a huge handicap. Apart from anything else, formal negotiations form only part of the discussions, and informal chats behind the scenes are a vital part of the process. They are obviously far less likely to happen in the current climate.
• Businesses which would be frantically preparing for a December deadline are, instead, wrestling with Covid-19. For many of them, it is a life-or-death struggle, and it is at best naive to believe they can also plan for our separation from the EU.
• The Government itself has a limited capacity to deal with crises – it is utterly unrealistic and, let’s be charitable, pretty unfair as well, to expect ministers and civil servants to cope with a December deadline and Covid-19 simultaneously. The Prime Minister will take time to recover from the coronavirus; the same is true of the machinery of government.
What do YOU think?
Multiple surveys suggest 60-70 per cent of the country now thinks an extension should be enacted.
Our own polling shows 64 per cent agreeing with the statement ‘The Government should request an extension to the transition period in order to focus properly on the Coronavirus’.
There is predictable support from those who voted Labour (84 per cent) and Lib Dem (83 per cent) at the last election, but also from nearly half of those who voted Conservative (44 per cent) and even a fifth of Brexit Party voters (19 per cent).
And this issue cuts across the generations too: extension is supported by more than 50 per cent of people across all age groups, with 18 to 24-year-olds the most supportive (78 per cent) and 65+ year-olds the least supportive, but still on 52 per cent).
Game, set and match
This is all about giving the country time to prepare adequately for the disruption our European divorce is likely to bring.
Like the people making the decisions about Wimbledon’s insurance, we must be prepared to make some relatively small sacrifice now in the knowledge that it will, in the long run, result in a better outcome.
That sacrifice means extending the December 31st deadline. With everything else that is going on, it is really a very small thing to do.
If we don’t, there is a very real risk that the combination of exiting the EU and dealing with Covid-19 will, for a great many businesses, mean it is game over.
If you believe an extension is in the best interests of the country, take action now.
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Flora Hutchings
Head of External Affairs, Best for Britain
Follow us on Twitter at @BestforBritain