Theresa May’s government has spent the past 18 months chasing unicorns. It has squandered time, frittered away our negotiating leverage and forfeited the goodwill of the British public, pursuing the fantasy of a tailor-made Brexit deal that would give the UK access to the bits of the single market we like without membership of EU institutions or acceptance of all of its rules. After the Salzburg summit , it should now be clear to even the slowest learner that this approach is not going to fly.
I share the widespread indignation about the way EU leaders treated our Prime Minister in Austria. But their brutal rebuff was utterly predictable. It may be unreasonable, it may be unfair but the other members of the EU have consistently made it clear that they are not going to budge from their opening position in this negotiation.
They are offering us a simple choice. Either we move to a position such as Norway’s — as members of the European Economic Area (EEA) and the European Free Trade Association (EFTA) inside the single market but outside the Common Agricultural Policy (CAP), the Common Fisheries Policy (CFP) and the European Court of Justice (ECJ). Or we move to a position more like Canada’s, with a comprehensive free trade agreement and zero tariffs but outside all EU institutions.
I voted Remain and believe the single market brings significant benefits to the UK. But I do not believe that it is sustainable for a country as large as ours to stay in the EEA and EFTA indefinitely, with limited say over new single market rules and little control over freedom of movement.
So I have concluded that we should aim for an enhanced version of the EU’s free trade agreement with Canada as the basis for our long-term economic relationship.
But even the most starry-eyed advocates of a Canada-style free trade agreement admit that it will take two or three years to negotiate the detail of this deal. So when we leave the EU on March 29 next year we will need to move to a halfway house.
The Prime Minister proposes an “implementation period” in which we remain subject to all of the EU’s rules and have to pay all the fees but lose our say over any of it. This is a truly terrible idea: we would be in a legal limbo nominally outside the EU but with even less control than we have now.
Worse still, in her middle-of-the-night desperation to secure this transition arrangement last December, the Prime Minister made a crucial concession that now threatens to derail the whole negotiation and force us to leave without a deal: the Irish backstop.
"We need a different halfway house, one that gives us more control, and a different withdrawal agreement"
This would give the EU a permanent right to keep Northern Ireland inside the single market and the customs union if the rest of the UK decided to leave them. Parliament will never accept that the union of Great Britain and Northern Ireland should be held at the mercy of a Damoclean sword wielded by the EU.
We need a different halfway house, one that will give us more control, and we need a different withdrawal agreement, one that will allow us to avoid the humiliation of the Irish backstop. This is what interim membership of the EEA and EFTA would provide. We should assert our rights under the EEA Treaty to remain a member after Brexit and apply to join EFTA as an associate member for an interim period.
This would take us out of the Common Agricultural and Fisheries Policies on March 29 of next year, allow us to swap the European Court of Justice for the EFTA Court and give us a bit more leeway to limit the free movement of workers.
Since we would no longer need the Prime Minister’s transition arrangement, we should tell the EU that we will stand by the €39 billion divorce settlement only if they consent to our continued membership of the EEA as an EFTA state, and agree a temporary customs union like the one they have with Jersey.
With the UK inside the single market and a customs union for an interim period of roughly three years until a free trade agreement has been negotiated, there would be no need for the Irish backstop. Everyone would understand that a long-term solution for the Irish border issues would need to be agreed as part of the free trade agreement and that no long-term deal could be reached without arrangements that are acceptable to both sides.
Next week in Birmingham, at the Conservative Party conference, the Prime Minister will pretend that the Chequers agreement is still negotiable and members of the Cabinet will pretend to believe her. It will all be bunk.
The Emperor has no clothes. After a brief delusional interlude, Parliament will return and MPs will need to grapple with the realities of the Brexit negotiation. It will soon become clear to all of them, Leavers and Remainers alike, that leaving via the EEA and EFTA and negotiating a Canada-style free trade agreement from this position of strength, is the only way to go.
Nick Boles is the Conservative MP for Grantham and Stamford. His Brexit plan is at betterbrexit.org.uk