Labour MPs must forget ‘common market 2.0’ – and back May’s deal

Henry Newman


Next week, MPs will most likely be asked to vote for a third time on Theresa May’s Brexit deal. So far, the prime minister has failed to convince more than three Labour MPs to back her deal. And yet there are many Labour parliamentarians who are publicly committed to respecting the referendum result and who oppose any move to a so-called people’s vote. Ironically, this group has no issue with any of the legally binding bits of the withdrawal agreement.

Some of these MPs favour a close relationship with the EU, perhaps based on Norway’s membership of the European Economic Area (EEA). This “Norway” or “Norway Plus” option has been cleverly branded “common market 2.0”. But that’s a slogan, not an actual deal. It’s a shorthand for describing a relationship that would keep the UK in a close EU orbit – as a member of the single market – and probably in a customs union as well, or something close to that. All of that would have to be agreed once we are out, not least because Brussels has interpreted article 50 to mean we cannot negotiate our future until we are formally divorced. We often hear complaints that the government is leading us to a blind Brexit – there’s some truth in that, although the backstop does offer an insurance policy to protect our trading relationship. But it’s the EU that has refused to negotiate the future until post-Brexit.

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Some EU members might be happy to keep the UK hugged close. But many recognise that we couldn’t have exactly the same relationship as Norway, not least as that wouldn’t resolve the issue of the Irish border. There would also be concerns that we are too big an economy to get that level of market access without far greater obligations. An Élysée source shared my concerns that if the UK became “Norway”, we would, in time, either break the agreement by pushing back on new rules, or end up crashing out and demanding a new deal.

The simple truth is that “common market 2.0” is an aspiration not a destination. It’s not the off-the-shelf model some claim. To get to it, you would need to agree protocols or derogations to the EEA agreement and possibly with the EFTA too. This would mean painstaking negotiations with all the EU27 plus Norway, Liechtenstein and Iceland. Along the way we could well lose some of the advantages that “Norway” offers. Expect the French to come for our fish, Spain for Gibraltar, and pretty much everyone to demand more money and more rigorous oversight via the European court of justice.

I cannot see how this sort of deal would be politically sustainable in the long term. Even its proponents accept that it would mean only limited control over EU free movement, other than in truly exceptional circumstances. Are MPs really ready to tell their constituents that Brexit won’t give us control over migration and will mean what many see as broad-spectrum rule-taking? Although Norway has more influence over EU’s rules than the silly “fax machine democracy” characterisation, the reality is that we would have to accept most new regulations across our wider economy. As Mark Carney has said, “it is highly undesirable to be a rule-taker” on financial services, which this sort of relationship would entail.

Nonetheless there are many MPs in several political parties who sincerely believe this is the best long-term option for the UK. I don’t doubt their good faith and applaud them for seeking compromise. On the Labour side this group includes the highly effective Stephen Kinnock and Lucy Powell. It’s perfectly legitimate to want a close relationship with the EU after Brexit – indeed many Eurosceptics would have bitten off David Cameron’s arm if he had offered them Norway or Switzerland five years ago. Lots of those same Eurosceptics have since lost all sense of perspective, failing to recognise any of the positives of May’s deal and preposterously denying that it delivers Brexit at all.

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The debate on our future can – and must – be had the other side of Brexit. We are just days from our scheduled departure date. The Labour common market 2.0 advocates are happy with every word of the legally binding divorce treaty with the EU. What they seek are changes to the political declaration, the aspirational document setting out what sort of relationship the UK and EU will negotiate. Yet the EU has pointed out that nothing in the declaration rules out “Norway” or “Norway Plus”. Michel Barnier has gone further, and promised that the EU would welcome the opportunity to negotiate a close relationship at any point during the transition after we have left.

I accept that many Labour MPs are furious that May has failed to reach across the House of Commons to find consensus on Brexit. She should have worked across party lines from the very start, especially after the general election in 2017 delivered a hung parliament. Rather than bringing the country and MPs together, she has often sharpened divisions. Her speech on Wednesday night only exacerbated that feeling.

But anger with May is not a good enough reason for voting down her deal. After all, it’s not just her deal but a draft treaty that has been negotiated and agreed by every single EU member state. It is the only deal available and it leaves the possibility of a future relationship with the EU that keeps the Irish border open. MPs of all parties who want to see Brexit delivered in an orderly fashion should back this deal. What they need is the surety that the next stages of the negotiations will be handled in a way that brings parliament and the country together around a consensus for our future.

• Henry Newman is the director of Open Europe. He has worked in the Cabinet Office and Ministry of Justice.