No Brexit alternatives offer better deal for Britain, report claims

David Cameron and President of the EU Council Donald Tusk.

David Cameron and President of the EU Council Donald Tusk.

0
Have your say

Alternative models for Britain's relationship with the EU do not offer a brighter future for the country, a civil service report claims.

The detailed assessment looked at the range of alternatives to remaining in a reformed EU, including arrangements used by countries like Norway, Switzerland and Canada – as well as falling back on World Trade Organisation rules.

The document, required by law under the EU Referendum Act, concludes that none of the other options offers a better deal for Britain than the special status for Britain negotiated by the Prime Minister.

The option that would offer the clearest break with the European Union would be for the UK to revert to World Trade Organisation rules, the report found, however this would mean new tariffs on UK exports to the EU, which could be up to 50% on some food products.

Norway has the closest model to Britain's proposed reformed relationship however it still involves hefty tariffs on agriculture and fishing.

Foreign Secretary Philip Hammond said: “The report concludes that Britain is stronger, safer and better off in a reformed European Union.

“Our special status gives us the best of both worlds: in the parts of Europe that work for us, but outside those that do not.”

A spokesperson for the Prime Minister said the leave campaign has so far been unclear in coming forward with one model it would like to see replace the current British-EU relationship.

While UKIP leader Nigel Farage has favoured membership with the World Trade Organisation, other Conservative out-campaigners have espoused the virtues of Canada's trading model with the EU.

The report is the next instalment in a line of fact-based dossiers produced by Whitehall, which formed part of the Government's commitment to the EU referendum.

Earlier this week they released report The process for withdrawing from the EU which said Britain would face a decade of uncertainty it were to leave due to the complexities of organising trade deals.

Do any of these models appeal to you?

Norway:

*Contributes significantly to EU spending

*Accepts free movement of people. More than 6 percent of the population resident in Norway are EU nationals - a higher proportion that in the UK (4%).

*Accepts 75% of EU laws but with no votes or vetoes over these rules

*Pays tariffs to export agricultural products and fish to the EU

The report says: Norway’s model would still mean making a significant contribution to EU spending, while accepting the principle of free movement of people. Norway takes in more EU migrants per head than the UK and is subject to three quarters of EU laws without having a vote or veto over them.

Switzerland:

*Pays into the EU

*Accepts EU free movement of people

*Limited access for services firms – services account for 80% of the UK economy

*UK financial services firms could face increased costs as they would no longer have ‘passports’ allowing them to sell to the EU market without needing extra permits

*No say or votes over EU laws

*Switzerland’s agreements with the EU have taken two decades to negotiate

Canada:

*The EU-Canada Agreement began over seven years ago with a scoping exercise and is still not implemented

*Only partial access to the EU single market, including for financial services

*Products with too many foreign components face tariffs, and quotas remain in place for key agricultural exports, such as beef.

*Car manufacturers must comply with the EU’s “Rules of Origin”, meaning increased bureaucratic costs

*No say or votes over EU rules but firms that export to the EU still have to comply with them

The report says: Switzerland and Canada’s current arrangements – which have taken years to negotiate – still give only limited access to the Single Market. Under both these models, UK financial services firms could face increased costs as they would no longer have ‘passports’ allowing them to sell to the EU market without needing extra permits.

Switzerland has to accept free movement of people and has almost four times as many EU nationals living in the country as a percentage of the population than are living in the UK.

World Trade Organisation:

*What we would have to fall back on if we failed to reach a deal with the EU

*New tariffs on UK exports to the EU, making UK exports far more expensive.

*Tariffs include 5% on chemical exports, 10% on cars, 20% on alcohol like Scotch Whisky and up to 50% on some foodstuffs

*A huge number of companies whose supply chain is in Europe would suffer thanks to increased tariffs and bureaucratic burdens. Increased tariffs could be passed on to consumers.

The report says: The option that would offer the clearest break with the European Union would be for the UK to revert to World Trade Organisation rules. This would mean new tariffs on UK exports to the EU, making these exports far more expensive. Huge numbers of British companies with supply chains in Europe would suffer.

Back to the top of the page