MacShane: ‘We can leave the EU but not the single market’

Anti-Brexit campaign group 'The No 10 Vigil' sail a boat bedecked with EU flags up the River Thames in London, Britain, 19 August 2017. [Tolga Akmen/EPA]

To stop Brexit now would require another referendum and there is no public appetite for it, according to Denis MacShane. Instead, he argues the British government should push to remain in the single market and keep trade with Europe open.

Denis MacShane was the UK’s minister for Europe in Tony Blair’s Labour government from 2002 to 2005. He is a regular contributor to EURACTIV.

MacShane spoke to Laurent Marchand from EURACTIV’s partner Ouest-France.

One year after the referendum, the Conservative government looks more divided than ever on the course it should follow in the Brexit negotiations. How much longer do you think Theresa May can hold out?

It is difficult to say. Since the election in June, there have been two dominant observations among the Conservatives. First, there was the view that this parliament would be tough. We will not see another election planned any time soon. We have already had five big electoral events in the last three years:  the 2014 European elections, which were a big victory for the Europhobes of UKIP; the Scottish 2014 referendum; the 2015 general election; the 2016 Brexit referendum; and finally the 2017 early general election. That is enough. The Conservatives will be able to hang on to power. They have 60 seats more than Labour and I do not believe they are a party that is about to implode.

The second observation concerns a level of disapproval for Theresa May that I have never seen before. The Tories are usually faithful to their leader, even if they do not like him or her. But now what we see is contempt, rejection. That said, when you ask them if they will change leader, they say no, it is too difficult. They do not want to risk an internal election that would divide the party even more deeply. There are no dominant personalities that could replace Theresa May, and that is how she is able to stay.

She is staying in power by default…

Let’s say she is there provisionally. But provisional leaders can last a long time.

But despite all this, they still have to set out an agenda for the negotiations.

For the moment the negotiation process is more or less being led by civil servants. At some point, May will be able to regain her pre-referendum position on Europe, as a Eurosceptic but a supporter of EU membership. The whole political class of the United Kingdom is now waiting for the public opinion, which is slowly turning against Brexit, to come out firmly against it. There is a significant group of Conservative MPs that are pushing a very hard line on Brexit. But are they in the majority? I don’t think so. When this sea-change in public opinion comes about, those who have real concerns about Brexit will begin forming ranks and opposing the total amputation of the UK from Europe.

That will take time.

Yes, it is a very slow process. Apparently, Theresa May will make a speech after the parliamentary recess in which she will clarify her position. But we are beginning to see new positions emerging. Like that of the very popular leader of the Scottish Conservatives. She recently said that we should stay in the single market. This is a sign of a slow but steady slide towards a Norway model of EU relations for the UK.

The Norway model means staying in the single market but outside the EU. So without decision-making powers.

Yes, and even Murdoch’s tabloid The Sun is now saying we have to pay out exit bill. Within the Labour party, things are reaching the boiling point too. We can clearly see the perception of the risk that the country faces if it leaves the single market and the customs union. Little by little, this will filter through to the constituencies, if all the businessmen, farmers and SMEs start talking about their concerns.

Is the possibility of a second referendum a more serious one today?

I do not think we will have a second referendum any time soon. I have always thought we need to wait at least two years after the first one for the people to rethink their decision. Look at Switzerland: in 2014 the people voted in a referendum to limit immigration from the EU. This could have led to discrimination against other members of the single market. The country’s business community told the party that promoted the referendum how economically damaging it would be for Switzerland to leave the single market and in 2016 the parliament passed a law that promoted the employment of Swiss citizens without discriminating against EU citizens. This allowed Switzerland to stay in the single market. I think this is something the UK should look into.

You predicted the result of the referendum two years before it happened. Your new book says there is no way out. Isn’t this crazy?

The way I see it, if we leave the EU completely, we lose all influence over the geopolitical future of Europe. Its foreign and security policy; we would have the same relationship with Brussels as Canada or Mexico has with Washington. Staying in will require a second referendum but I don’t think there is the appetite for it. Because if the second referendum overturned the decision to leave, a big proportion of the 52% would be furious and a large share of Tory MPs would be in permanent rebellion.

So you don’t think staying in is a real option?

I think that what is possible is to leave the EU treaty, then the prime minister can honestly say we have fulfilled the mandate given by the referendum. We have left the EU. Our parliament will now decide all of our laws, so we are free and independent. That said, we are a pragmatic country, founded on trade. A nation of shopkeepers as Napoleon said. Many of the European regulations were written by us, by Margret Thatcher and Britain’s other prime ministers, to make Europe more liberal and better suited to our ways of trading. And we should not reject what we helped to build. So we should put in place more rigorous controls on the labour market to encourage access for British citizens, while continuing to pay into the EU budget for market access, rather than our enormous budget contributions. But we should stay in the single market.

The Norwegian model, then?

Yes, or the Swiss model. We have to look at the context. The referendum took place at a time when all the indicators on the continent were negative, because of the long economic and monetary crisis. That added to the Brexit vote. But if European countries over the coming months begin to show positive results and solid growth figures, while the UK falls behind, that will also have the power to change minds.