How long can Brexit remain a taboo subject? banner


How long can Brexit remain a taboo subject?

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How long can Brexit remain a taboo subject?

It is quite hard to believe that the vote on the UK’s continued membership of the European Union took place on 23 June 2016, six and a half years ago. That is probably because the tortuous process to negotiate the country’s way out of the EU took until withdrawal on 31 January 2020 and, even then, there was an eleven month transition period to allow frictionless trade to continue whilst post-Brexit arrangements were finalised.

The Leave vote (by 52% to 48%) was, as the voting figures indicate, hugely divisive with almost half of voters wanting to stay in the EU. David Cameron immediately resigned as Prime Minister; and the Brexit negotiations led to the downfall of another PM when Theresa May resigned in July 2019. Her successor, Boris Johnson, achieved a large majority at the General Election of December 2019 by vowing to “Get Brexit Done”, which led to the January 2020 final withdrawal and the end of the transition period in December 2020.

The total Leave vote was 17,410,742 out of a total registered electorate of 46,500,001. Scotland voted overwhelmingly for Remain, as did most of Northern Ireland where particular issues arose because of the land border with the Republic of Ireland, a staunch EU member. That resulted in the very controversial Northern Ireland Protocol, which has threatened peace in the province and left it without a devolved executive. It is a continuing problem which remains for the current UK Prime Minister Rishi Sunak, who succeeded the short-lived PM Liz Truss.

You may have noticed from the above that the country has been through five Conservative leaders since the referendum in 2016, not to mention the Covid-19 pandemic, renewed efforts by the Scottish Nationalists to call another independence vote in Scotland, the war in Ukraine, soaring energy bills and a big hike in food prices.

Amidst all of that political mayhem, you might be wondering what happened to the great promises made for Brexit prior to the 2016 vote. It would take a much longer piece than this to list all the pledges and to tell you whether they have been fulfilled, or are ever likely to be. Accordingly, I will focus on food and the role it is playing in the current cost-of-living crisis.

Researchers from the London School of Economics have estimated that Brexit added almost £6 billion to UK food bills, or £210 for the average household, in the two years of 2020-2021. This equates to food prices rising by 3% in each of those two years. The LSE report also indicates that the poorest households felt the largest cost of living increase.

Despite the claims which were made before the referendum, none of this should be very surprising as, prior to the vote, 77% of food imports were from the EU. Certain products, such as fresh red meat, have high non-tariff barrier costs due to the additional paperwork and regulatory checks. Inevitably, these extra costs have been passed on to consumers and fuelled the cost of living surge.

Food may be a smaller proportion of household budgets than energy costs, but the increases in food prices are very visible to consumers shopping at least once a week and often several times.

96% of adults have blamed rising food prices as the main reason for the cost of living crisis and, with the British Retail Consortium reporting food price inflation of 12.4% in November 2022, it is not hard to see why. Again low-income families, spending a higher proportion of income on food, will be feeling it the most.

Overall, UK inflation has reached 11%, the highest in 40 years, and hard-pressed families are really struggling. This can be seen in the dramatic rise in food banks, supporting not just those out of work but also those in employment who cannot make ends meet.

Against this backcloth you might have expected there to be a renewed discussion about the impact that Brexit is having on the economy. According to a recent poll for the Observer, 66% of those polled think Brexit has gone badly, whereas just 22% think it has gone well. Perhaps not surprisingly, around half of Conservative voters remain positive about Brexit, but, even among their ranks, 39% think it has gone badly.

If prices are going up, the spotlight falls on the value of the pound in your purse or pocket to pay for the increases. Sadly, there is no good news there as the fall in the value of the pound after the 2016 referendum was the biggest depreciation for any of the world’s four major currencies since 1944, according to the newest member of the Bank of England Monetary Policy Committee.

It is probably not hard to understand why those Conservatives who campaigned so robustly for Brexit want to keep quiet about its effects. Maybe more difficult to understand is the position of Labour, the main opposition party, which is also keen not to revive discussion about the merits of leaving the EU. With the next General Election to take place no later than January 2025, and with the opinion polls strongly in their favour, Labour prefer to focus on the shortcomings of the government than risk alienating those ‘Red Wall’ parts of the country which voted Leave.

It may be a pragmatic stance taken by Labour leader Keir Starmer, and may fend off the pro-Remain stick the Conservatives would use to beat the Opposition; but the economic price being paid by the UK for Brexit is only going to get worse and this issue cannot be swept under the carpet for much longer.

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.
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    Written by Julian Wild