The phrase “managed divergence” has attracted much mystification in Westminster. But there is a way forwardby Marley Morris / March 1, 2018 / Leave a comment
A bitter storm sweeps across the UK from the continent, causing widespread disruption: yes, it’s the latest publication from the European Commission on Brexit. Politically and meteorologically, Theresa May makes her pitch this Friday to Brussels in the worst of conditions. The fragile consensus secured in December for the UK-EU Withdrawal Agreement is on the brink of collapse after the release of the European Commission’s legal translation of the December deal, in which it proposes that Northern Ireland remain part of the European Union’s customs union.
There is one plausible way for May to navigate her way through the coming storm. The key lies in the phrase “managed divergence” that emerged from the Brexit committee’s Chequers away day. While this phrase has provoked much mystification in Westminster, there is a way of interpreting it meaningfully—as a partnership based on the principle of continued alignment with the EU’s rules on the single market, with the option to diverge from these rules over time.
This is the premise of IPPR’s “shared market” proposal, which we published in December. In the shared market, the UK would continue to align with the four freedoms (seeking a Swiss-style compromise on the free movement of people). Moreover, it would stay aligned on broader areas related to the single market—including competition and state aid rules, as well as consumer, employment, and environmental protections.
Similarly, the UK and the EU would agree a joint comprehensive customs union covering all goods. The UK would be responsible for making its own free trade agreements, but would nevertheless continue to align its external tariff and trade policy with the EU’s.
Alongside this objective of alignment, there would be a mechanism to allow for the UK to diverge over time, if it so wished. A new set of surveillance and judicial bodies—mirroring those that exist for Norway’s agreement with the EU—would monitor the possibility of divergence. Of course, any divergence from EU rules would be met with proportionate limitations on EU trade. The UK could choose to diverge, but that divergence would have a meaningful cost.
IPPR’s approach rejects the three baskets methodology which is clearly unacceptable to the EU because it would be regarded as ‘cherry picking’. The goal of the Shared Market is to achieve a…