Brexit: The Explainer

What is Brexit

Brexit, a portmanteau of “British” and “exit”, is the impending withdrawal of the United Kingdom (UK) from the European Union (EU). It follows the referendum of 23 June 2016 when 51.9 per cent of those who voted supported withdrawal. Withdrawal has been advocated by Eurosceptics, both left-wing and right-wing, while Pro-Europeanists (or European Unionists), who also span the political spectrum, have advocated continued membership.

The UK joined the European Communities (EC) in 1973 under the Conservative government of Edward Heath, with continued membership endorsed by a referendum in 1975. In the 1970s and 1980s, withdrawal from the European Communities was advocated mainly by the political left, with the Labour Party’s 1983 election manifesto advocating complete withdrawal. In the late 1980s, opposition to the development of the EC into an increasingly political union grew on the right, with Margaret Thatcher – despite being a key proponent of the European single market – becoming increasingly ambivalent towards Europe. From the 1990s, opposition to further European integration came mainly from the right, and divisions within the Conservative Party led to rebellion over the Maastricht Treaty in 1992.

The new UK Independence Party (UKIP) was a major advocate of a further referendum on continued membership of what had now become the European Union, and the party’s growing popularity in the early 2010s resulted in UKIP being the most successful UK party in the 2014 European Parliament election. The Conservative Prime Minister David Cameron pledged during the campaign for the 2015 UK General Election to hold a new referendum—a promise which he fulfilled in 2016 following the pressure from the Eurosceptic wing of his party. Cameron, who had campaigned to remain, resigned after the result and was succeeded by Theresa May, his former Home Secretary. She called a snap general election less than a year later, but lost her overall majority. Her minority government is supported in key votes by the Democratic Unionist Party.

On 29 March 2017, the Government of the United Kingdom invoked Article 50 of the Treaty on European Union. The UK is due to leave the EU on 29 March 2019 at 11 pm UK time, when the period for negotiating a Withdrawal Agreement will end unless an extension is agreed. May announced the government’s intention not to seek permanent membership of the European single market or the EU customs union after leaving the EU and promised to repeal the European Communities Act of 1972 and incorporate existing European Union law into UK domestic law. A new government department, the Department for Exiting the European Union, was created in July 2016. Negotiations with the EU officially started in June 2017, aiming to complete the withdrawal agreement by October 2018. In June 2018, the UK and the EU published a joint progress report outlining agreement on issues including customs, VAT and Euratom. In July 2018, Cabinet agreed to the Chequers plan, an outline of proposals by the UK Government. In November 2018, the Draft Withdrawal Agreement and Outline Political Declaration, agreed between the UK Government and the EU, was published. On 15 January 2019, the House of Commons voted 432 to 202 against the deal, the largest parliamentary defeat for a sitting UK government in history.

The broad consensus among economists is that Brexit will likely reduce the UK’s real per capita income in the medium term and long term, and that the Brexit referendum itself had damaged the economy. Studies on effects since the referendum show annual losses of £404 for the average UK household from increased inflation, and losses between 2 and 2.5 per cent of UK GDP. Brexit is likely to reduce immigration from European Economic Area (EEA) countries to the UK, and poses challenges for UK higher education and academic research. As of November 2018, the size of the “divorce bill”—the UK’s inheritance of existing EU trade agreements—and relations with Ireland and other EU member states remains uncertain. The precise impact on the UK depends on whether the process will be a “hard” or “soft” Brexit. Analysis by HM Treasury has found that no Brexit scenario is expected to improve the UK economic condition. A November 2018 Treasury publication regarding the potential impact of the Chequers proposal estimated that within 15 years the UK economy will be 3.9% worse off compared with staying in the EU.

Brexit Terminology Explained

Backstop
A term referring to the government’s proposal to keep Northern Ireland in some aspects of the European Union Customs Union and of the European Single Market to prevent a hard border in Ireland, so as not to compromise the Good Friday Agreement. (See Irish border question.) In principle, it is a temporary measure while the United Kingdom identifies and develops a technology that operates customs, excise and other controls as between the UK and the EU, without any evident border infrastructure, and there must be compliance with section 10 of the European Union (Withdrawal) Act 2018, on “Continuation of North-South co-operation and the prevention of new border arrangements.”

Blind/Blindfold Brexit
Coined in September 2018 to describe a scenario where the UK leaves the EU without clarity on the terms of a future trade deal. EU and British negotiators would then have until 31 December 2020 to sign off on a future trade deal, during which time the UK will effectively remain a member of the EU, but with no voting rights.

Brexit
Brexit (like its early variant, Brixit) is a portmanteau of “British” and “exit”. In popular usage, it was derived by analogy from Grexit, referring to a hypothetical withdrawal of Greece from the eurozone (and possibly also the EU). At present, it is impending under the EU Treaties and the UK Acts of Parliament, and the current negotiations pursuant thereto. However, the term Brexit may have first been used in reference to a possible UK withdrawal from the EU by Peter Wilding in a Euractiv blog post on 15 May 2012 (this is given as the first attestation in the Oxford English Dictionary).

Brexiteer/Brexiter
Those supporting Brexit are sometimes referred to as “Brexiteers”, or “Brexiters”. Alternatively, the term “Leavers” has also been used in media outlets.

Canada Plus
This is shorthand for a model where the United Kingdom leaves the European Union and signs a free trade agreement. This would allow the UK to control its own trade policy with non-EU countries, but would require rules of origin agreements to be reached for UK–EU trade. It is likely this would lead to trade being less “free” than joining the EFTA, and result in additional border controls being required, which is an issue of contention, particularly in Ireland. The Canadian – European Union deal took 7 years to negotiate, but Brexiteers argue it would take much less time between the UK and EU as the two participants already align on regulatory standards.

Chequers Plan
The short name given by the media to The framework for the future relationship between the United Kingdom and the European Union, the government’s white paper drawn up at Chequers and published on 12 July 2018 which set out the sort of relationship the UK government wanted with the EU after Brexit. On 22 November 2018 the government published the updated draft.

Divorce bill
It is expected that the UK will make a contribution toward financial commitments that it approved while still a member of the EU, but are still outstanding. In the first phase of negotiations the total amount was referred to as the single financial settlement, or just the settlement. Especially in the media, this has been called an exit bill or divorce bill, while the EU talk of settling the accounts. While serving as Brexit Secretary, Dominic Raab said the UK will not pay its financial settlement to the EU in a no-deal scenario. The Withdrawal Agreement published in November 2018 states that the financial contribution will be £39 billion.

Hard and Soft Brexit
“Hard Brexit” and “soft Brexit” are unofficial terms that are commonly used by news media to describe the prospective relationship between the UK and the EU after withdrawal. A hard Brexit (also called a no-deal Brexit) usually refers to the UK leaving the EU and the European Single Market with few or no deals (trade or otherwise) in place, meaning that trade will be conducted under the World Trade Organization’s rules, and services will no longer be provided by agencies of the European Union (such as aviation safety). Soft Brexit encompasses any deal that involves retaining membership in the European Single Market and at least some free movement of people according to European Economic Area (EEA) rules. Theresa May’s “Chequers plan” embraced some aspects of a “soft” Brexit. Note that the EEA and the deal with Switzerland contain fully free movement of people, and that the EU has wanted that to be included in a deal with UK on fully free trade.

Managed No Deal
“Managed no-deal Brexit” or “managed no deal Brexit” was increasingly used near the end of 2018, in respect of the complex series of political, legal and technical decisions needed if there is no withdrawal agreement treaty with the EU when the UK exits under the Article 50 withdrawal notice.

Norway Model or Norway-plus
This is shorthand for a model where the United Kingdom leaves the European Union but becomes a member of the European Free Trade Association (EFTA) and the European Economic Area, possibly with the addition of a customs union (“plus”). EFTA and EEA membership would allow the UK to remain in the single market but without having to be subject to the Common Fisheries Policy, Common Agricultural Policy, and the European Court of Justice. The UK would be subject to the EFTA court, which largely shadows the ECJ, have to transfer a large amount of EU law into UK law, and have little say on shaping EU rules (some of which the UK will be compelled to take on). The UK would also have to allow freedom of movement between the EU and UK, something that was seen as a key issue of contention in the referendum.

Remainer
Those in favour of the UK remaining in the EU are sometimes referred to as “Remainers”. The derogatory term “Remoaner” (a portmanteau of “remainer” and “moaner”) is sometimes used by pro-Brexit media outlets.

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