This weekend’s summit is an important moment as Europe works to create some shape and direction out of the dark, chaotic and destructive Brexit vote of 2016. If things go as well as possible the Withdrawal Treaty will be agreed and will then go forward to the UK Parliament and European Parliament for ratification.
This would be extremely welcome, but it is important that we do not waste this rare full debate on Brexit by ignoring the fact that not only is the short-term outcome uncertain, there is still no clarity on many long-term issues. Even more importantly Ireland is today well behind where it should be in preparing for the inevitable impact of Brexit.
A fully agreed and ratified Withdrawal Treaty will be, at best, the end of the beginning. We will still face potentially years of negotiations and damaging uncertainty.
As we saw last year, over-emphasising interim agreements, however welcome they may be, breeds a damaging complacency.
It serves no useful purpose for us to waste our time here commenting on the ignorant and clownish behaviour of some Brexiteers. In meetings in different contexts I have experienced the Brexit advocacy of certain of the loudest Tory Europhobes. It is clear that they have no interest in rational discussion. Just like fundamentalists of all varieties, the more their ignorance is exposed the more fanatical they are in their advocacy.
I would go as far as to say that we have as a country spent too much time in the past two years feeling indignant about the dishonesty and ignorance of many Brexiteers. Some of this time and space would have been better spent on a more questioning approach to our national preparations for Brexit. There is simply no way of looking at the hard facts of preparations and missing the gap between the rhetoric and the reality.
The motion before the House will have no legal impact. The position of the majority in this House is well known and we are not in a position to ratify a text which has not been finalised or sent for ratification. It is the explicit policy of government that the Dáil does not give it a negotiating mandate – as we have seen in the Government’s dismissal of the Dáil’s views on matters such as the Middle East.
In spite of this we will of course be supporting the motion and we have already expressed our support for the draft text in our discussions with our European partners. We need to pay tribute to our dedicated officials and diplomats for their regular briefings and their consistent hard work on the issues.
We are also supporting the motion in spite of the Taoiseach’s decision last week to refuse to supply any legal opinion on the impact of the proposed text. It is his position that we should rely only on the opinion of the EU’s legal service – something which will not be available until the text has been sent to the European Parliament.
It appears that there are significant practical issues over what checks would and would not be required for North/South trade under the proposed arrangements post-2020. Equally, the draft Agreement does not include text on a whole range of issues which have to be sorted before the customs arrangement in the Backstop could be implemented. We understand that Michel Barnier’s team has mentioned this in presentations and it has already been raised by the Parliament’s Brexit Committee as a concern.
We obviously do not have the type of legal expertise available to us to assess whether the text is as certain as the claims being made for it. However, whether or not the text delivers on what is claimed for it, it is politically and economically a welcome and essential step forward – and its ratification would mark real good faith towards delivering on its claims.
If there are practical agreements required after next March, such as the road transport agreement which is a fundamental requirement of a single customs territory, it is reasonable to assume that these will be addressed as a priority.
There were reports last night and again this morning that Prime Minister May is proposing an amendment concerning the Backstop which may satisfy the less revolutionary Brexiteers in her party. Without any concrete details on this we’re not in a position to comment – though we expect that there will be no agreement to any amendment which would in practice make the Backstop unuseable.
It appears to us to be a balanced text where the Union’s negotiators went to the very limit of their mandate in order to show flexibility and to help London address its self-imposed pre-conditions. They did this in a highly professional and creative way.
I would like to acknowledge the regular, comprehensive and professional information and briefings which my party has received from Michel Barnier and his team since their appointment. His commitment to Ireland and to the European Union has been both resolute and fair. We particularly welcome the fact that he considered technical suggestions from a wide range of sources.
Should the text change significantly this weekend, we will not be looking for issues to cause controversy. If the core principles of seeking to protect both the Good Friday Agreement and the integrity of the European Union are maintained we will continue our unmatched, nearly sixty year record of choosing a European future for Ireland.
I want to address a series of urgent issues linked directly to Brexit which we need to act on. Before doing this it is important to comment on a number of political matters.
From very soon after the start of 2013 when David Cameron announced his disastrous decision to hold an In/Out referendum this has been an issue regularly addressed by Fianna Fáil. Unlike the government, we did not wait until mid-2016 to call for preparations. In fact it has been one of the most prominent and regular issues addressed by us for over five years – including the period of the Cameron government’s absurd Review of EU Competencies and its campaign to renegotiate the Union’s treaties.
Since the referendum we have been actively constructive. During the appearances of key EU leaders in Dublin, in meetings in Brussels and in wider political contexts we have made it absolutely clear that there is a broad pro-EU, anti-Brexit consensus amongst the Irish population and the majority in the Dáil.
We have also gone further than this in specifically assuring the Council, Commission and Parliament of the stable support of the majority for the negotiating objectives first set out by Deputy Kenny as Taoiseach with Dáil support and reaffirmed since then.
When the government started briefing that it might need to call an election to have a mandate for Brexit discussions we responded to European inquiries and confirmed our consistent position that nothing would be done to question this mandate or to bring down the government at critical moments.
Having checked with parties in other countries I can confirm that the Irish government is the only one of the many minority governments in Europe which has been offered a guarantee from the largest opposition party that it will maintain its mandate during this critical phase of Brexit negotiations.
In the context of 5 years of addressing the issue, constant affirmation of a consensus on the key issues and active lobbying for the Irish position, we will take no lectures about stability or responsible behaviour on Brexit from a government which has regularly sought to project instability. The government has received far more backing and active support than any other government in Europe.
Yet we have seen over-the-top and choreographed reactions to even the smallest criticisms. The record of the House shows that any challenge from any part of the House has been denounced as “irresponsible” and always eager Fine Gael backbenchers have been sent out to amplify the message. The fact that the first reaction to last week’s deal was for ministers to discuss how to trigger an election suggests a government which always puts politics first.
It has always been our position that we all have to look beyond the crisis in hand and realise that there are many broader issues to be discussed.
The impact of Brexit on the peace settlement has quite rightly been the dominant focus of discussions here and throughout the country. When my party’s government negotiated the Good Friday Agreement we ensured that throughout the Agreement membership of the European Union was used as a way of providing common ground on political, legal, economic, social and identity issues. Europe is in the DNA of the peace settlement because the Ahern and Blair governments, and John Hume, understood the EU’s unmatched genius at breaking down barriers and overcoming historic conflict.
However while Europe was once a point of shared interest in Northern Irish politics it has now become the greatest cause of division in over two decades.
Following next March, Northern Ireland will contain the largest number of EU citizens anywhere outside of the Union’s borders. The acknowledgement of the continued automatic right to EU citizenship of Northern Irish residents is a very important issue – an issue which we have raised consistently since the Brexit vote – and we appreciate the steadfast support which EU states have given.
How the Northern Ireland-specific elements of a backstop will work is not very clear. Mechanisms for ensuring regulatory alignment and exactly how frictionless trade will be delivered have not been fully defined and remain to be negotiated during the next two years. However, as I have said, the Withdrawal Agreement demonstrates good faith and we will have to hope that discussions during the transition period get underway as soon as possible.
What the EU is offering Northern Ireland is a very good deal which would make it the only place in the world with guaranteed free access to the single markets of the United Kingdom and European Union. For the first time in its recent history Northern Ireland would have a competitive edge to address the economic challenges which have been ignored for far too long.
This is why so many organisations in Northern Ireland which are solidly non-political have come out in favour of the Withdrawal Agreement.
It has been the core position of democratic parties on this island for half a century that Northern Ireland can only be peaceful and prosper if minority views are capable of being heard and taken seriously. This applies to the minority views of those who oppose the Withdrawal Agreement. We achieve nothing by condemning them or engaging in a destructive war of words.
In newspaper articles, speeches and meetings I and my party have sought to reach out to unionist opinion and reaffirm the fact that the democratic majority in the Dáil in no way seeks to use Brexit as a way around the unequivocal protections which they have under the Good Friday Agreement. We welcome the Taoiseach and Government’s continued affirmation of this as well.
For Northern Ireland to miss out on the EU’s generous offer would be to tragically miss an opportunity for economic development which would threaten none and benefit all.
It is important to say that the continued absence of the Assembly and Executive has damaged Northern Ireland’s interests profoundly. The institutions which were collapsed because of a heating scheme have been silenced at the time when they are needed the most.
It is impossible not to comment on the fact that Sinn Fein has claimed that Brexit is a defining issue of our time but has denied Northern Ireland a voice on this issue. It is Ireland’s most consistently anti-EU party and has directly sought to introduce long-term constitutional issues into the Brexit discussions. It cannot have intended to help sooth unionist fears when it announced that Brexit should be a cause for a unification referendum.
Once again, unionists should listen instead to the majority voice in this place and throughout the island – your constitutional position is unaffected by anything in this draft Agreement. All you are being offered is unique access to a major market – access which offers unprecedented new opportunities for investment and growth.
In terms of the overall transition backstop and future trading relationship, what has been agreed by Michel Barnier is dramatically better for Ireland than a crash-out Brexit with WTO terms. He has shown creativity, generosity and flexibility towards the UK.
While the deal may be as good as it gets I think people need to step back for one moment and realise that there is nothing to celebrate and the Agreement leaves in place much of the likely economic damage of Brexit.
The EU/UK relationship is intended to be a hybrid of a customs union, free trade area and single market access. The balance within this hybrid relationship will change as time progresses and new agreements take effect. As such it is unclear what the exact economic impact of this deal on Ireland will be, however we do know that it will be significant and it will be damaging.
Based on the only independent economic impact assessment commissioned by government, the full implementation of the Agreement will deliver a loss to national income of between 2.8% and 4.3%. In monetary terms, and using the conservative GNI* measure, the hit to national income will be between €5 billion and €7.7 billion per annum. This is over twice the size of the enormous unfunded tax promise announced by the Taoiseach at the weekend.
There has been far too little attention paid to whether or not we are prepared for meeting an economic threat which is of the level of at least €5 billion per year.
As everyone knows by now the failure to turn words into action, combined with an obsession with marketing, is a defining characteristic of this government. The delivery gap is acute across a wide range of policies, with housing, health and critical infrastructure like broadband causing real social and economic damage.
Unfortunately this delivery gap is also being seen with Brexit preparations.
There are many Brexit schemes. There is an increasing amount of advertising – and there is a non-stop effort by ministers to claim that everything is in hand. Unfortunately the growing evidence is that Ireland is nowhere near Brexit ready.
The Netherlands is the EU member state most similar to Ireland in terms of the potential scale of Brexit impact. It has already hired and trained 1000 customs and related staff who will be in place on March 29th next year. Ireland has just started the process of hiring 400 and there is no detail about when they may be trained and available. It is absolutely clear that we will not have the staff in place to meet all eventualities next March.
There are many Brexit schemes which have been announced, but their impact is at best minor.
A €23 million working capital guarantee scheme was announced last year with the European Investment Bank offering to leverage this up to €300 million. The latest available figures show that only 3% has been allocated and only 38 SMEs have been sanctioned for loans.
A Brexit Future Loans scheme was announced in October 2017 with the intention of providing 8-10 year loans for market and product diversification. This scheme has not even opened for applications yet and it is unlikely that a single company will have received funding before Brexit takes effect next March.
Other small advisory grants are being allocated at a rate of 12 companies a month and are benefitting a small number of impacted companies.
Wherever the fault for this lies, the simple fact is that Brexit supports are having only a marginal impact and all available surveys suggest critical parts of Irish business are not Brexit ready.
According to Bord Bia, which has published the most recent survey available, 83% of companies likely to be impacted have not yet modelled the impact of tariffs and regulatory compliance. 60% have no plans for dealing with increased costs. 61% have no contingency plans for supply-chain disruptions. Few have any plans for dealing with disruptions on the landbridge route to Europe. Two thirds of companies have not begun preparing for the trusted trader status central to avoiding major disruption.
Currency fluctuations are already a reality and the devaluation of Sterling is something which may continue irrespective of whatever deal is reached. In fact 77% of companies in the research say that currency fluctuation is the biggest risk they face.
And this has become an emergency, with nearly one in five businesses exporting to the UK having said that they will face severe difficulty at the exchange rate in place today – and most of the rest will face sever difficulty if Sterling declines by up to 3% more.
Brexit is already hurting – with the Central Bank pointing to emerging problems in industrial production, including chemicals and machinery, and food export volumes down by nearly 5% because of Sterling.
There is simply no doubt that we need a dramatic improvement in the implementation and impact of Brexit supports. Much of the information activity currently underway should have been completed long ago as most of the needed preparations are required no matter what the outcome for the transition period or the final relationship between the UK and the EU.
The complacency of ministerial statements about being Brexit ready must be replaced by an urgent approach of going directly to companies to aid them in starting to address key risks.
Absolutely everyone knows that March 29th is a critical date where there are many possible outcomes. The fevered intensity of politics in Westminster means that there are no certainties.
And Ireland simply isn’t ready for many of the possible outcomes.
We will support any reasonable request for urgent legislation or funding which will help speed up the current snails-pace level of implementation. It is our understanding that the EU will be flexible in terms of aid which is essential to help companies and communities to address a threat of unprecedented scale even if the draft Agreement is ratified in Westminster and Brussels.
It is over two years since both governments and the EU agreed that the Common Travel Area should continue. We welcome the fact that this commitment has been repeated. However, the failure to move forward with more concrete measures is a serious concern.
Most expert opinion points to the need for a legal approach to both formalise existing practice and manage future rights once the UK is no longer implementing common EU legislation. Some legal experts have suggested that a new Anglo-Irish Treaty is required.
We need formal legal agreements about health and education, for example. Already students from the island of Ireland and from the UK face challenges in deciding courses because of the uncertainty in fee structures.
We need systems which ensure ongoing consultation and the avoidance of conflict. The Common Travel Area is about much more than the lack of passport checks and the right of residence – it has significant fiscal and legal dimensions which have to be addressed.
For this to be done we should seek the establishment of a task force between Dublin and London which is separated from the overall Brexit negotiations.
If the Withdrawal Treaty is finalised and ratified, it will be an important and positive step – but it comes nowhere close to delivering a final form of Brexit for Ireland or for Europe as a whole.
It is the end of the beginning of Brexit and not the final destination. That will require potentially years of further negotiations.
If it is not ratified then the first step should be an extension of the Article 50 process to avoid a cliff-edge next March. Other than that there is no useful purpose to escalating concerns at this point.
What is for sure is that Brexit is already causing damage and will cause much more damage. We need a much greater sense of urgency which can close the growing gap between words and impact on preparations for Brexit.