I want to direct today’s article mostly to Leavers. For the breadth of this piece, I will not suggest that leaving the EU is a good or bad idea, nor even that leaving with no deal is a good or bad idea. Let’s park those arguments for now. What I want to talk about here is just the idea, the erroneous idea I hasten to add, that leaving the EU with no deal at the end of March means we get to keep the £39 billion all to ourselves. This is a myth, one that the political media just will not step in and debunk in any way, so here goes.
For a start, the £39 billion is an agreed figure between the UK and the EU. Now, you can say that to hell with the agreement, we should never have agreed that figure with the Commission. Walking away from the agreement at this point, however, and you then have an ongoing problem. A UK out of the EU will want to strike new trade deals, right? As in, that’s one of the main reasons for leaving the EU, so we can have an independent trade policy? Agreeing to pay £39 billion and then simply reneging on that figure will make it hard for any other government to trust the UK in the near future. It could also cause huge damage to the current international system, stuff like the WTO that largely works via good faith from every country (if countries broke agreements all the time, the amount of complaints to settle at WTO level would be totally unsustainable and the system would simply collapse), the very same system a non-EU UK is going to have to fall back on.
The £39 billion isn’t something the UK has agreed to pay to keep talks about a future relationship between the UK and the EU alive: it is what we’ve agreed to pay in terms of outstanding debts. Now, you can say that figure is ludicrous, we should never have agreed to that, etc, etc. The point is, the UK has.
Beyond the maintaining the trustworthy reputation of the United Kingdom point, there is actually a much more pressing and unavoidable reason for the UK having to cough up the £39 billion in the end. If we crash out with no deal, in the immediate term the UK will have to come to a fairly complex set of arrangements with the EU, and quickly. This is what Tory cabinet ministers talk about when they say “managed no deal”; the idea that the EU will have a vested interest in keeping things like aeroplanes flying in and out of London. That could very possibly be the case in some instances. But they aren’t going to even begin discussing this without legally tying down the £39 billion. This will be step 1 of “managed no deal”, which won’t be nearly as managed as the UK would like it to be. And not only will Theresa May not think twice about agreeing to that under the circumstances, so would anyone else who was prime minister. Any other Tory, whatever they might say in public now, would sign over the £39 billion in those circumstances. Hell, I reckon even Nigel Farage would do it.
Again, whatever you want to happen with Brexit is one thing. Maintaining this fantasy about keeping the £39 billion is just that. The only way to not pay this money over to the EU is, ironically enough, by remaining in the EU. £39 billion will be the price of any Brexit, including no deal.