The Jersey option – is it the only way we can do Brexit and keep the UK intact?

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Few who are not deeply partisan would dispute three propositions. The first is that Brexit is not turning out as promised. The second is that it is likely to weaken the UK economically. The third is that the future unity of the UK seems imperilled by all Brexit options currently on the table because none of them solves the problems Brexit creates in Ireland, and so in turn with Scotland.

Some time ago I read of an option that could solve the  Irish issue. And it could simultaneously let the UK have some more control over migration (and it already has a lot, but just declines to use those it has). Whilst it also lets us have our own trade deals, albeit on services alone, which account for 80% of all UK trade. This is the so-called 'Jersey option'. I dismissed it not because of the name, or the fact that it describes the current relationshiu0p between that Crown Dependency and the EU, but because when I first heard of it the chance that it was remotely plausible when the government's rhetoric was so robust so remote in the extreme.

Now I am not so sure. I was discussing international negotiations with a student this week. I explained that these often appear snake-like with the parties slithering closer to and then away from each other over time, but what really matters is the trajectory. Within the slithering, there is a direction of movement. It can be convergent, or not. That is much more straight line in many cases than the slithering makes things appear to be.

The reality is that the Brexit negotiations are converging. As we know, this means that the UK has conceded almost everything so far. That has surprised me. But what that means is that when at one time the Jersey option seemed very remote now it seems plausible. It has been described like this:

  • The UK could take to the world and try to sign services-only trade deals.
  • The UK would need to agree to follow all of the rules of the customs union, single market rules for goods and the EU’s VAT regime. All industrial goods and agriculture would have to be covered. Anything less would create a situation where checks on origin and standards, among other things, would still be required at the border.
  • The UK would have to agree to rules on state aid, industrial emissions and social and employment laws, to avoid the charge of environmental and social ‘dumping’.
  • The agreement would need a surveillance mechanism, to check that the UK is complying with EU rules, and a court to settle disputes between the EU and the UK. Any new court would have to take account of the case law of the European Court of Justice.
  • The EU would insist upon a financial contribution to the economic development of Central and Eastern Europe, among other things. The Swiss, for example, contribute around half the UK’s current payments per head. They have a similar level of access to the single market as the proposal outlined here.
  • The biggest question is whether the EU would insist upon free movement of EU workers as it stands, or whether it might be possible for the UK to negotiate controls on free movement, in exchange for the obvious damage that this agreement would do to the City of London.
  • The customs union issue has already been pretty much agreed. So too, when it comes to it, has staying in the single market been agreed when it comes to goods: that is the only way to solve the Irish problem and May has said it will be solved. Not changing VAT means that trade remains almost frictionless: it is possible to be in the EU for VAT and not otherwise, as the Isle of Man has proved. And we have agreed to pay, come what may.

In other words, what was once impossible to imagine is now possible. And there is a precedent, albeit for a rather small island.

Is this plausible? I think it is now.

Is it desirable? No, not nearly as much as staying which is better on almost every count for this country and for the EU, which I think needs the UK at the table. But if compromise is required this may be as good as it gets now.

Ireland is solved.

We do not suffer trade issues.

We can have some freedoms that will reduce stress in this country that would otherwise arise if we stayed.

And we remain good neighbours with close relations with the EU.

Will it happen? Who knows? But I think that right now it may be the best hope there is.