WHICH EXIT AFTER BREXIT?
We’ve had the referendum and the combination of those who think there are too many EU migrants and those who think that there are too many EU rules and those who think that the EU is not “British enough” and those who think that the EU is undemocratic have won. The pound and stock market have crashed and the Bank of England is trying to figure out how to stop the economy going further into freefall as companies like BMW/Mini put investment plans for the UK on hold.
While in Moscow President Putin is on his fortieth bottle of celebratory vodka back here the Conservative Party has imploded, David Cameron and George Osborne have resigned in disgust, Boris Johnson is PM and a Brexit committee of Boris, Jeremy Hunt, Liam Fox and Ian Duncan Smith has been formed.
They invite Nigel Farage into a meeting to decide which route to exit the EU. They sit in the cabinet office with cups of coffee and biscuits and turn to each other. “Don’t ask me which is the best exit route” says Liam. “Boris, you said it will all be fine. What plan do you have?”. “Don’t be daft” replies Boris “I just said it will all be fine so that we can win and I could be Prime Minister, I didn’t actually have a real plan”. They go round the table and, hey, it seems that no one has a plan!
They turn to the Cabinet Secretary (the most senior UK Civil Servant) and ask him for the choices.
“Best is a Norway type deal” he says “we are out of the EU but get access to the EU market. That will allow British business to stay competitive, will preserve the rights of the two million Brits living in the EU and will restore inward investment.
Of course we will still need to have free movement of people in the EU and so we still will not be able to limit the number of EU citizens coming here.
We will still have to abide by most of the EU rules we have now but won’t have any input into drafting them.
We will still have to pay about four billion pounds a year contribution to the EU.
The cost in lost taxes will be about 30 billion pounds in the first five years”.
“That’s no good”, says Nigel “I want to stop the invasion of all these Polish plumbers”
“OK, how about a deal like Switzerland’s?” says Liam.
“That’s basically the same in practice as Norway’s” relies the Secretary.
“That’s no good then” says Ian.
“Right” says Boris, “we will go it alone, get on a plane to Brussels and negotiate our own brilliant deal”!
“Well”, the Cabinet Secretary replies “we’ve just spent the last three months slagging off the EEC and telling them that they are a load of overpaid, corrupt, undemocratic bureaucratic twits who can f--k off. Hence I get the sneaking suspicion that we can’t expect an exactly sympathetic attitude from them now”!!!
However If we allow all the EU migrants to stay here we might not leave the Brits in Europe up the creek without a paddle - but getting a decent trade deal is going to be virtually impossible for several years till the heat dies down. ”
“Who cares about trade deals” exclaims Boris!
“No trade deal,” the Secretary replies “means everything we import from the EEC requires 10 times as much paperwork, they will slap 6% duty on everything we export to them, our financial services industry will be shut out of Europe and inward investment to the UK will dry up. The fall in Stirling will push up inflation.
On top of all this we will spend 10 years trying to negotiate trade deals round the World to stop other countries slapping duty on UK imports. That will need about 400 trade negotiators and the Civil Service currently has 5”.
“Oh dear” says Ian “but the economy will be all right won’t it, after all Mr Dyson thinks we will be OK on our own?
“Dyson will be fine; they make their vacuum cleaners in Malaysia!
For the UK generally, because of the uncertainty, extra costs, difficulty of doing business, labour shortages and lower investment, the consensus is that going-it-alone will reduce the size of UK tax revenue by at least 100 to 150 billion pounds over the first five years after we decide to Brexit. Of course we will save our net EU contribution, which we think would save about 40 billion pounds over those five years. In summary, we think that going-it-alone, at a very optimistic estimate, will cost the Treasury at least sixty to one hundred and ten billion pounds just in the first five years after we make a decision. That excludes the cost of employing the thousands of extra civil servants we will need to handle things that we currently let Brussels deal with and the thousands of extra agents the Border Agency will need to handle all the extra administration.
That’s a disaster” says Ian,
“Don’t blame me” says Boris“.
“I can afford private health insurance so we can easily cut NHS funding” says Jeremy “that will balance the books”!
“I know what to do” chirps Liam. We’ll get Corbyn in and invite him to be PM then he can take the blame”!
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