Brexit - Fox Admits We’re Screwed

The Government’s Brexit minister David Davis may have experienced a moment of déjà vu yesterday, after his colleague Liam Fox made a routine-sounding statement to the Commons on the UK’s commitments to the World Trade Organisation (WTO). That is because the statement was potentially very bad news indeed, and slipping it out when most eyes were on the Supreme Court recalls an incident Davis knows all too well.

Back in October 2001, then minister Stephen Byers’ spinner “Jo Moore apologised … for sending a memo on the day of the US terror attacks saying it would be a good time to ‘bury’ some controversial stories”. Who was on the case? “Conservative Party chairman David Davis has urged a high-level investigation after it emerged that a senior government advisor suggested controversial stories could be buried in the news fallout”.

Since then, the wording “a good day to bury bad news” has smacked of Government desperation and underhand manoeuvring. So it will be entirely understandable for Fox, Davis and the rest to go into full bodyswerve mode at the suggestion Fox may have chosen his moment so as to avoid maximum scrutiny. Here’s what he said.

“The United Kingdom is a founding member of the World Trade Organization (WTO). In addition to the general obligations of membership, all WTO members undertake specific commitments in their goods and services schedules: WTO members’ goods schedules set out upper limits for tariffs and detail any tariff rate quotas, and WTO members’ services schedules set out commitments and reservations across all sectors and list specific sectoral commitments and reservations”. That’s the straightforward bit.

Then it gets interesting: “The UK’s WTO commitments currently form part of the European Union’s schedules. When we leave the EU we will need UK-specific schedules. In order to minimise disruption to global trade as we leave the EU, over the coming period the Government will prepare the necessary draft schedules which replicate as far as possible our current obligations. The Government will undertake this process in dialogue with the WTO membership. This work is a necessary part of our leaving the EU. It does not prejudge the outcome of the eventual UK-EU trading arrangements” [my emphasis].

Why should there be a problem here? Ah well. The WTO represents 164 member states. That means “dialogue with the WTO membership” is code for “we need the agreement of 163 other countries to copy over the EU tariff schedules into new UK-only schedules”.

It gets worse, and a lot more difficult: many of those schedules are EU-wide ones, so there has to be negotiation, and subsequent agreement, on what proportion of any quota applies to the UK. Some quotas involve differential tariffs, so some of a commodity is charged at one tariff, and everything above that level at another. See how complex it is already?

On top of that is the inevitable appetite for WTO members to use this exercise to score a little national advantage. And it all has to be done within two years, which it all too obviously will not be. That may explain the BBC’s James Landale’s characteristically understated Twitter observation “Away from the Supreme Court, the government slips out a statement that may have more impact on our our future”.

Here on Zelo Street there is no such need for restraint. This means we’re screwed.