With the first round of the
Conservative Party leadership contest out of the way, we see Theresa May emerge
with what should be an unassailable lead of 165, taking votes from exactly half
of the 330 Conservative MPs.
Leadsom trailed badly with a mere 66 votes but
beat Gove, with only 48 votes, to second place. Crabb took fourth place with 34
votes and Fox brought up the rear with a mere 16. These two have now pulled
out, pledging their support to Mrs May for the next round, to be held on
On the face of it, this should give Mrs May a
commanding lead, but leave Leadsom still in the race, with the final decision
to be put to the constituency members. Struck down by the "curse of the Tory
frontrunner", we could then
see Leadsom take the crown – and the keys to No 10.
However, we are dealing with what is slated to be
one of the most sophisticated electorates in the world. In a bid to strengthen
May's position out in the country, her supporters could transfer enough votes
to Gove to assure him the second place, reducing to run-off to a contest
between May and Gove the "Boris killer". In that scenario, May wins
Should the more likely scenario arise, with a
final contest between May and Leadsom, and Leadsom wins, we are faced with the
great danger of having a prime minister who has little understanding of what it
takes to negotiate a successful withdrawal from the EU.
On the other hand, if May is elected, we are
faced with a danger just as great, in having a prime minister who brokers an
exit plan which is so successful that we end up stuck with it, and in a
position far worse than we are at present.
If this sounds perverse, it is. What we are
seeing from the "remains" is a sudden enthusiasm for the Efta/EEA or
"Norway option", an option which, prior to the referendum, they had
all been falling over themselves to demolish.
This, as readers here well know, we support as
an interim option, acknowledging that it would be untenable for the United
Kingdom in the longer term. We thus look for a different end game, which then
takes us out of the EEA.
Unfortunately, the opposition is wise to the
flaws of the EEA option and, from the Robert Schuman Foundation, the intellectual heart of the EU, we see proposals to modify the EEA to such
an extent that it will soften some of the worst features of the EEA, and thus
weaken the pressure to move on.
What they have in mind are changes to Part VII
of the EEA Agreement, addressing "the inability of
the EEA States" (they mean Efta states) to take part in the vote over the
internal market rules.
Instead of the Council of the European Union
(formerly the Council of Ministers) taking the dominant role, the EEA Council
would be the body charged with approving Single Market legislation, thereby
giving Efta members some "say" in how the rules were made.
These decision-making powers might also be
extended to the Union’s programmes in which the Efta states had chosen to
participate, such as the research framework.
Similarly, the Foundation argues, it might be
possible for the mixed EEA parliamentary committee to be transformed to include
all Union parliamentarians and "European Members of Parliament"
appointed by the non-EU EEA States. These EMPs would meet in Brussels and be
able to take part in co-decision in the same way as the EEA Council.
As to freedom of movement, the Foundation
acknowledges that it would continue to apply. But it notes that "the EEA
Agreement provides safeguard mechanisms that can be activated unilaterally".
Thus, far from trying to conceal or argue against the Liechtenstein solution, it seems possible that the UK could
be offered this as a way out of the free movement impasse.
The changes proposed, if implemented -
plus the application of the Liechtenstein solution (which would perhaps involve
some reciprocal restrictions) - would effectively formalise the creation of a
multi-speed Europe. The UK would become part of the "outer circle" of
a construct dominated by the eurozone, the result little different from the
"associate membership" expected of a new treaty.
By this means, we could be on the way to becoming a "second-class
citizen", locked in a Greater Europe whose appetite for the creation of a
United States of Europe would be entirely undiminished. The only difference is
that it would be disguised as membership of an enhanced EEA, possibly termed
the "EEA-plus". We would be "out" but still in.
In the choice between May and Leadsom, therefore, we could find ourselves
wedged between two undesirable outcomes – a choice between second-class
membership in an enhanced EEA, or the chaos of a world outside the Single
Market with no coherent replacement. In these choices, there is danger either
The obvious antidote is to create a third way, the idea set out in Flexcit,
where the third phase offers the opportunity of creating a genuine Europe-wide
single market, freed from the grip of Brussels. For that, we will probably
have to look not to either of the leadership contender front runners, but to
Parliament, which has the power to shape the exit settlement, if it chooses to
use that power.
To that effect, as Flexcit nears 100,000 downloads, we have published a new
edition, Version 7. This is the first written specifically for the
post-referendum period. It is marginally shorter, despite additions which cover
border issues in Ireland, EU budget contributions and the Liechtenstein
solution, omitting some of the arguments relevant only to the referendum
Progressively, we will reshape the contents to put more emphasis on the end
game, rather than on the mechanics of leaving the EU, in the hope of
influencing the final outcome.
Managing immigration within the EEA: The Liechtenstein solution
In response to common misconceptions of the EEA option