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What has Brexit ever
done for us?
02/06/2024 by Catherine McBride 2,288 Views 14 min read
BREXIT IS NOW IRREVERSIBLE!
Written by Catherine McBride
Brexit has returned sovereignty to the UK – its most important
attribute. But it also means we must choose our politicians carefully.
They now have control over our laws, money, taxes, trade, transport,
farming, fishing, financial services, science and technology, migration,
and legislative scrutiny. Here is a brief rundown of some of Brexit’s
results, so far.
Post Segments
Sovereignty and the Law
Public finances
Trade
VAT, Tariffs and other taxes
Transport
Fishing and Marine protection
Farming
Science and technology
Financial Services
Migration for work and study
Free speech and legislative scrutiny
Conclusion
With the election looming, I thought it might be worth recapping some of
the benefits of Brexit before the Remainers start lobbying the incoming
government to rejoin the EU.
Sovereignty and the Law
The most important Brexit benefit is sovereignty. The ability of the UK
Government to make its own laws is a definite Brexit win. Even if you
don’t like the laws that the government is making, now you can vote to
remove that government. More importantly, the laws that are being
enacted are designed to suit the UK’s population and economy and are not
about issues that do not concern the UK, such as the number of acorns
that must be fed to an Iberian pig in Spain. (I thought I was just being
absurd for effect, but there really are EU regulations about this.)
The alternative to sovereignty is increasingly evident across the EU.
Where European voters are turning in frustration to extremist parties,
realising that leaving the Eurozone is a practical impossibility. This
is a recipe at best for paralysis, at worst for violence.
The downside of sovereignty is that now we need politicians with
experience of life outside Westminster, with big-picture ideas and a
good grasp of macro and microeconomics. Hopefully, in the forthcoming
election, we will get more MPs willing to propose new ideas to improve
life in the UK. Too many of our present MPs were, like Ken Clarke,
simply ‘looking forward to the day when the Westminster Parliament is
just a council chamber in Europe.’ and were more than happy to adopt EU
regulations and directives without question.
Part of restoring UK sovereignty includes the restoration of the UK’s
Courts which are once again the supreme arbiters of UK laws. You may
have thought that was always the case, but courts in the UK had to take
into consideration European Court of Justice (ECJ) rulings until January
this year, four years after the end of the transition period. When the
UK was a member of the EU, the ECJ’s decisions were binding on UK
courts, directly impacting UK laws.
However, we aren’t completely out of the ECJ’s clutches because Northern
Ireland is still in the single market and must obey EU rules. Even as
late as September 2023, the ECJ was able to fine the UK £27.6 million
for allowing pleasure boats in Northern Ireland to use ‘red diesel’
intended for fishing boats. Red diesel has a lower fuel duty of only
10.18p per litre instead of 52.95p. Incidentally, the size of the fine
was based on the size of the whole UK economy, even though the majority
of that value was no longer in the EU. The EU’s backdoor control over
Northern Ireland via the Northern Ireland Protocol / Windsor Framework
has prevented the UK from taking full advantage of Brexit.
Public finances
The next most obvious Brexit benefit is financial. The UK has saved
its taxpayers literally billions of pounds by being outside the EU. Not
just by stopping the regular payments of customs duties, a portion of UK
VAT, and a contribution based on the UK’s Gross National Income but also
by avoiding paying for the EU’s overly generous, E750 billion Covid
Recovery Fund which was primarily used to rebuild Spain and Italy.
Trade
The third most obvious Brexit benefit is the UK’s new trade policy. The
EU was after all established to be a Customs Union, encouraging EU
countries to trade with each other by placing high tariffs and small
quotas on imported goods from outside the EU. These tariffs also enabled
UK and EU producers to be inefficient by protecting them from cheaper
imported competition.
In 2016, The UK was one of only three EU countries that traded more with
the outside world than it did with the EU – the other two were tiny
Malta and Cyprus – so the UK’s contributions to the EU coffers from
import duties were larger than other EU countries. Now both Ireland and
Denmark export more to non-EU countries than to the EU – but this is
primarily due to the massive amount of trade they both do with the UK.
Ireland sells us beef, butter and cheddar while Denmark sells us bacon
and butter.
With the UK’s new trade freedom – the Department of Business and Trade
has:
rolled over the trade agreements we had when we were members of the EU;
signed new trade agreements with the EU, Australia, New Zealand, the
CPTPP, Ukraine, and the Eastern and Southern African countries;
improved the continuity agreement with Japan;
signed a digital agreement with Singapore;
developed our own Developing Countries Trading Scheme; and
they are currently negotiating with South Korea, Switzerland, India,
Israel, Canada, Mexico, and the Gulf Cooperation Council.
Quite an impressive list for a department that didn’t exist when the UK
was a member of the EU. The UK’s new or improved trade agreements also
include services. Services are now 55% of the UK’s exports but were
largely ignored in EU-negotiated trade deals.
Not only have we negotiated so many new trade deals in a fraction of the
time it takes the EU to negotiate a single trade deal – that is if
negotiations don’t break down completely – we also have a tariff-free
and quota-free trade deal with the EU. Something that no other non-EU/EEA
country has. So UK trade with the EU has continued as before, admittedly
with some Covid-related supply constraints and with importers and
exporters now paying their own trading costs, rather than having them
paid by the taxpayer through our EU budgetary contribution.
This may not seem to be a Brexit Benefit as many Remainers and even some
Brexiteers believed trade with the EU was free. But it wasn’t, the UK
population was paying for it, while the companies involved were
benefiting. A classic case of privatising your profits and socialising
your costs. The same companies never complained about paying their costs
when they traded with non-EU countries, such as China or the US, our two
largest trading partners. But many are still complaining about the loss
of this public largesse when trading with the EU.
VAT, Tariffs and other taxes
It is also worth pointing out that HMRC now keeps any tariffs that the
UK charges on imported goods, whereas before Brexit, 80% of the money
was sent to Brussels. Now the EU has generously dropped the 80% to 75%
for its members but has added a plastic packaging tax and is in the
process of adding a Carbon Border Adjustment Mechanism that will also go
to Brussels. Nothing shows concern for the environment like sending the
money raised by taxes on plastic packaging and CO2 emissions to
Brussels, rather than letting the countries involved use it to
compensate the companies they have forced to use less efficient
low-emission manufacturing processes. (but I digress.)
On the subject of EU taxes, a proportion of the UK’s VAT was also sent
to Brussels, and Brussels set the number of VAT exemptions and reduced
rate items as well as the minimum standard rate of VAT, presently 15%.
EU members are unable to remove or reduce VAT other than on items
approved by the EU. From 2007 to 2013 the UK paid 18% of the EU’s VAT
revenue. (And they wonder why we voted to leave!)
But the UK can now keep all of the money it raises in VAT. It can also
remove VAT if it likes, as the present government has on solar panels
and heat pumps. Or it can add VAT to items exempt from VAT in the EU,
such as school fees, something the Labour Party is proposing to do if it
wins the election.
Another Brexit benefit has been the ability to control our import
duties. The Government removed all of the EU’s ‘nuisance’ tariffs –
those below 2%. These tariffs raised very little money but created a lot
of paperwork for importers. The Government has also removed the tariffs
on many goods that the UK doesn’t produce, but it was forced to impose
them to protect other EU producers when we were EU members. The UK has
recently suspended its tariffs on tropical fruit juices, citrus juices,
tofu, cut flowers and nuts, as well as on plastic seals used in engines,
leather for making shoes, various chemicals and car parts. Incredibly,
the UK still has tariffs on many other goods it doesn’t produce such as
rice, avocados, olive oil, cocoa butter, quinoa, and maple syrup – but
at least tariffs are heading in the right direction.
Transport
On the subject of trade, UK hauliers are now able to use long
semi-trailers to reduce transport costs and carbon emissions. Something
that was not allowed by the EU. The UK has also created several new Free
Ports, although the EU has free ports their State Aid rules limit the
benefits. The UK has also removed regulations on consumer goods pricing
and is technically outside of the EU’s state aid restrictions, although
the Windsor Framework has complicated this for Northern Ireland and any
UK companies that trade there.
Fishing and Marine protection
The UK has regained control over its territorial waters, enabling it to
close part of Dogger Bank to protect seabirds and ban bottom trawling in
13 Marine Protected Areas in the UK’s territorial waters. This hasn’t
gone down well with the French – but it has with marine environmental
groups.
The UK’s fishing industry is gradually regaining control over its
fishing grounds. Under the UK EU Trade and Cooperation Agreement (TCA),
25% of the EU’s quota for fish in UK waters is being transferred to the
UK. This is being done over a five and a half year period and the
process will be completed by 30 June 2026. After that, mutual access to
UK and EU waters will be through licencing for fishing boats and
negotiated annually.
Farming
Leaving the EU’s Common Agricultural Policy (CAP) has also allowed
farmers the freedom to plant the crops that will give them the highest
return. Under the EU’s crazy ‘three crop rule’ farmers with more than 30
hectares were forced to plant three different crops, with no crop taking
up more than 75% of the farmer’s land. This reduced revenues for the
UK’s relatively larger farms.
UK farmers are no longer simply subsidised for the amount of land they
own, as they were under the EU’s CAP. I would have hoped the loss of CAP
payments would have encouraged UK farmers to increase their
productivity, however our newly independent Department for the
Environment, Food and Rural Affairs (DEFRA), has decided to replace CAP
payments with payments for taking farmland out of production. DEFRA now
pays farmers to grow wildflowers, birdseed or trees, rather than produce
food.
Those UK farmers who disagree with this policy can vote for new MPs at
the next election. While farmers in the EU can only resort to spraying
the EU parliament with slurry. (Not as grown-up, although probably a lot
of fun.) Although the slurry worked, the EU has only postponed its Net
Zero farming rules by one year. No doubt EU farmers will have to return
with more slurry next spring.
Science and technology
The UK’s scientists are now able to develop gene-edited plants and
animals. Outside the EU these could now be used in the UK to reduce
diseases and lower pesticide use, as they have in the world outside the
EU. UK scientists could even develop LAB-grown meat if they thought
anyone would eat it, although they should prepare to do battle with the
National Farmers Union (NFU) if they do. However, if UK farmers are
being paid to grow wildflowers – the scientists may not meet any
opposition from the NFU.
The UK also hopes to regain the clinical trial industry that it lost to
the US after the EU imposed draconian rules that greatly increased the
costs of this process. There is also a hope that UK scientists will lead
the way in AI and robotics; however, we will need much cheaper
commercial electricity to do so.
Financial Services
In financial services, the UK’s extremely large investment funds can now
trade off-market using ‘Dark Pools’ without fear of hitting the EU’s
crazy Double Volume Caps. The UK’s stockbrokers can distribute financial
analysis on small-cap companies without investors having to pay for the
reports, and bankers and fund managers can be paid as their employers
prefer. There is no longer a cap on bonuses and fund managers can be
paid in cash rather than in units of their fund. The UK’s Competition
and Market Authority is now solely responsible for UK mergers and
acquisitions, rather than the EU making any monopoly decisions based on
the whole EU market, rather than the effect on the UK.
Migration for work and study
The UK can determine who can immigrate to the country, for how long, and
for what purpose. We can put minimum thresholds on wages for immigrant
workers and determine which business sectors can import staff.
Immigrants with entry visas for longer than 6 months must pay a health
surcharge to use the NHS. All of this was impossible when we were in the
EU and had to accept the EU’s free movement of people, with or without a
job, and give EU nationals access to UK healthcare and other benefits.
Now EU students who attend UK universities must pay the same fees as
non-EU students. This has been a windfall for UK universities, as EU
students must now pay almost three times as much as they did before
Brexit. This has also been a bonus for taxpayers who were effectively
subsidising EU students before Brexit.
I will concede that many UK nationals are annoyed that their children
have been crowded out by higher fee-paying overseas students. But again
– like it or loathe it – this is a decision of the universities and the
Government. You can’t vote out the universities, but you can change the
government.
I completely accept that we presently have a problem with illegal
immigrants who are not obeying our new immigration rules, but again – we
can now elect a new government that may, or may not, have a better plan
to stop the rubber boats. But this problem isn’t due to Brexit: illegal
immigrants are also landing on the shores of Spain, Italy and Greece.
However, if we were still in the EU, the EU’s new migration Pact would
compel us to accept a proportion of these arrivals as well.
Free speech and legislative scrutiny
Finally, there is the important matter of free speech. Brexit has
allowed the UK to avoid the EU’s Digital Services Act. Instead, we have
the Online Safety Bill. Whether one is better than the other is hard to
discern – but we were able to debate the Online Safety Bill vigorously
in the House of Commons and the House of Lords, resulting in many
changes and amendments to the bill. EU members were not able to do this
for their Digital Services Act.
This is why we left! Public scrutiny of legislation is important. For
too long we have simply followed whatever directive or regulation was
passed down from Brussels. This has created lethargic politicians and
given us ineffective regulations. Brexit is changing this for the
better.
Conclusion
There are many other Brexit benefits, but many are particular to
industries and generally unknown to the general population.
Unfortunately, most of the Mainstream Media doesn’t believe these
regulatory changes are newsworthy and prefers to claim that Brexit isn’t
working. But it is, and we must continue to support it. Please vote
wisely in the upcoming election. |
