We are so gripped by fear that we are failing to plan properly for post-Brexit Britain, writes Bill Jamieson.
Who is brave enough to look beyond the next 80 days? Who even dares to predict beyond the Commons vote next week? A defeat for the Government earlier this week not only makes a ‘no deal’ Brexit well-nigh impossible, it also effectively blocks tax and budget changes that would have helped mitigate the adverse effects of such an outcome.
But what happens if the Prime Minister, as widely expected, loses the vote on her withdrawal deal next week? A scramble to delay the 29 March deadline? More desperate attempts to secure some comforting form of words from Brussels? A second referendum? A general election? These more dramatic, tumultuous outcomes now look ever more likely.
We should have been planning and preparing, long before now, for a UK beyond Brexit. But we can barely look. We can’t move beyond the immediate mechanics and the day-by-day political wrangling. When the finger points at the moon, goes the Chinese proverb, only the idiot looks at the finger. But for the past two-and-a-half years the entire country seems to have been unable to do more than finger-gaze.
The exhaustive, debilitating process of Brexit – the procedural mechanics, the backstop, the rows in the Commons even before we get down to the detailed negotiations on our trading arrangements with the EU – have been the obsessive focus. Very little time has been spent on the greater and more compelling issue: what domestic policies should we put in place in the UK post our departure? How can we make the nations and regions of the UK more prosperous, more competitive and more resilient to downturns and adverse shocks?
And such policy preparation should not be confined to institutions at the UK level. Scotland specifically has much to plan and prepare, not only to make good the ending of EU regional grants and structural funds, but also to embark on a broad raft of infrastructure upgrades and improvements.
Instead we have talked ourselves into a state of nervous breakdown over the prospect of Brexit – deal or no deal. Business and household confidence alike has buckled under the onslaught of dire warnings of disruption and chaos. But even among many Brexiteers, there has been a failure to look beyond the finger.
For example, it was widely thought that the pound’s fall in the aftermath of the referendum vote would provide a vital stimulus to our export trade, encourage inward investment and slash the trade deficit. But, while the deficit on current account fell from an all-time record of £103 billion in 2016 to £68bn in 2017, the most recent figures for the third quarter of 2018 showed a deficit of £26.5 billion. Net trade as a proportion of GDP is no higher today than it was three years ago when devaluation began. It follows a long list of devaluations that, while giving a temporary fillip to exports, has not helped our long-term trading performance. Down goes the pound – but we are more dependent than ever on household consumption and government spending. On this measure we have becomes less, not more of an enterprise nation. The UK’s deficit as a proportion of GDP, at 4.9 per cent, is bigger than at the time of the OPEC oil crisis of the 1970s and the Lawson boom of the late 1980s.
So, what sort of UK policy should we be looking to make after 29 March? Suggestions have included a massive national transformation fund buttressed by central government post-Brexit agricultural and fish policies – moving subsidies towards smaller farmers and fisheries.
The focus of infrastructure improvement needs to swing away from prestigious projects of questionable benefit such as HS2 to address the hundreds of road and rail improvements beyond the south-east in urgent need of attention. There is also a strong case for the creation of low-tax ‘free ports’ – currently blocked under EU rules – across the UK.
For the present, the Conservative Government still seems wedded to “industrial strategy” thinking and its bedraggled counterpart “picking winners”. Better, surely, to relieve Government of its politically driven investment guessing game and instead move towards simpler (and lower) taxes to help households and the SME sector in particular, which accounts for the vast majority of firms in Scotland and some 45 per cent of private sector employment.
One glaring area in need of attention – agreed across the political divide – is skills and vocational training. We may fairly boast the highest level of numbers in work on record and well above the EU average. But we still have a staggering 848,000 unfilled vacancies with employers struggling to find skilled workers. Clearly much more needs to be done on top of all the fanfared initiatives, schemes and action plans to upskill the labour force.
These are the urgent issues. The SNP has lost no opportunity to attack the UK Government for lack of Brexit preparation. But what practical, positive proposals has it put up for discussion with the UK Government to ensure the best deal for Scotland? It would be reassuring to think that such discussions and consultations are going on behind closed doors. But somehow I doubt it. The SNP has remained focused on using the Brexit crisis as a means to being about a second referendum on independence.
Brexit is not some magic wand that will by itself transform our fortunes. It has always been a means to an end, not the end itself. Dominic Cumming, the enfant terrible of the Brexit campaign, rightly described EU departure as an opportunity and a catalyst for fresh start. Now it seems these very words scare the daylights out of a country that pines, not for new opportunity but old certainties – all the more so given the signs of slowdown already upon us and the World Bank warning this week of “darkening skies”. Seldom has the UK been more divided. But seldom, too, has it been made to feel more fearful. It is time we started to look ahead – if only we could lift our gaze beyond the immediate crisis.