Is May suddenly beginning to take seriously an alternative to the backstop?

Who’s the bloke in the flat cap with IDS and Peter Lilley? Yes! It’s our very own David Trimble leaving Downing St last night after this gang of three veterans made a last minute pitch for a different border solution to that agreed between the EU and Theresa May. Lilley, a Thatcher disciple and former trade secretary refused to reveal what went on  the Today programme this morning.

Now No 10 tells us that May listened and the cabinet discussed their alternative approach this morning.  Perhaps this was one way of getting through a sticky session. Any more to it than that? Tomorrow she has talks with Commission president Juncker to settle final details of the agreement and review the political declaration of guidelines for the final deal. But we were also told from Brussels that the PM will also not be able to lobby EU leaders at the Brexit seal the withdrawal deal summit this Sunday according to the planned choreography of the meeting. The EU 27 will meet alone first to sign off the text amongst themselves before they sit down with Mrs May.

So what else is this about? A sop to the Brexiteers to try to win Commons votes? Not from this group of three surely,  nor the ERG who are backing their case. But as attention switches from the withdrawal agreement to the political declaration on the final settlement, might a version of “max fac”  a few years down the track have legs after all? The three veterans’ case was based on a new paper published by the think tank Global Britain and the European Research Group and written by Peter Lilley. It purports to demolish the key assumptions of the withdrawal agreement including the claim that a “clean Brexit” would mean a hard border. The pamphlet restated the case for “max-fac”, a model under which customs checks enabled by technology happen away from borders. Lilley claimed:

 “The reason they give for turning it down was partly because they were afraid it might not apply to Northern Ireland … but also because they said a free trade area introduces friction in trade because companies have to lodge customs declarations and declare the origins of their goods. I’ve published a paper today saying that all these fears … are at best exaggerated and at worse completely imaginary.”

No 10 had previously rejected it after tax chiefs warned it could cost up to £20bn a year to implement. There was also widespread scepticism outside Brexiter circles that the technology was ready.

The spokesman added. “I think there was discussion in cabinet about the fact that the withdrawal agreement recognises and keeps open the potential for alternative arrangements to avoid a hard border on the island of Ireland.

“Both the text of the Northern Ireland protocol itself and the outline political declaration note, and I quote: ‘Note the [European] Union’s and the UK’s intention to replace the backstop solution on Northern Ireland by a subsequent agreement that establishes alternative arrangements for ensuring the absence of a hard border on the island of Ireland on a permanent footing’.”

The indefatigable student of Brexit and the border  Katy Hayward  has tweeted a link to her analysis of the latest technological developments. It is interesting to counterpoint her information with Peter Lilley’s.  

Lilley

“Many of the problems ascribed to leaving the EU’s customs union are imaginary and most of the rest are exaggerated Official estimates of the cost of complying with rules of origin are even less defensible. They are based on outdated and irrelevant studies of trade between underdeveloped countries and the USA or the EU. A more recent authoritative study by the WTO shows that, except for infrequent consignments, the costs of complying with rules of origin are ‘negligible’ – they do not even wipe out a 1% tariff preference. Moreover, the new REX system – which the EU has agreed to extend to the UK post Brexit – further simplifies the procedure for declaring origin.  A particular concern has been fear that lengthy delays at ports and consequent congestion on motorways will disrupt plants dependeàant on Just-in-Time supply chains (JIT). As explained, HMRC do not expect more checks on imports from the EU post-Brexit and will prioritise flow over compliance.”

Hayward.

“Singapore has just revealed the world’s first blockchain-based platformfor electronic certificates of origin (eCOs). Blockchain is a way of recording transactions on a decentralised public register that’s very hard to tamper with, and is the technology behind bitcoin. Verification of eCOs through a private blockchain network helps prevent fraud and alterations of certificates of origin. This could address one issue that the UK and the EU face. But this doesn’t go anywhere near resolving the risk of customs fraud on the Irish border. The difficulty of policing this border was exploited by smugglers even when it was heavily securitised.

The effectiveness of maximum facilitation in customs enforcement stands or falls on the scale and quality of the information the systems receive. This type of border control requires operators and travellers to pre-register for customs checks and constantly disclose accurate information to all relevant parties.

When vehicles pass through approved crossings, officials can track the progress of registered vehicles (albeit without knowledge of what they are carrying). If used on a mass scale, big data can be be used to identify patterns of suspicious activity.

It is also possible to gather information that is not willingly – nor wittingly – submitted by those crossing the border. Sensors buried in the ground or micro synthetic aperture radar on drones in the air could detect unexpected vehicle movement across a border.

Such technology may have its uses in unpopulated, inhospitable plains where border crossings are almost automatically suspect. But as a means of monitoring a border that is literally criss-crossed with small roads and straddled by farms, households and parishes, it is as redundant as it is offensive.

Just think how the residents of Dover or Holyhead would respond to the idea of being constantly surveilled by drones or mobile phone tracing. Those in the Irish border region have recent experience of close surveillance and border controls. Twenty years on from the Good Friday (Belfast) Agreement, the negative consequences of militarised security at the Irish border remain evident: economically, socially and politically.

It is absolutely critical to appreciate that the achievement of a porous, unmonitored Irish border is a much-cherished sign of the peace process. Hence the promise to avoid a hard border.

Another concern about customs checks is the question of how these might occur. Goods container inspections require physical infrastructure and human resources. Experience on the Irish border shows that routine customs inspections can escalate into serious operations requiring security protection. Politicians hope technology can alleviate this.

There have been steady advances in non intrusive screening techniques. Vapour analysis using what’s known as neutron-activated spectroscopycould enable customs to detect the presence of certain chemical compounds. Gamma ray scanning can be used to give a type of x-ray image of what is inside a container, while Muon tomography can help customs assess the volume and location of contents in a container.

But these technologies are very expensive and impractical. They are designed for a particular task, such as detecting a specific type of contraband, and are neither speedy nor invisible.

Human checks on goods will remain critical to customs supervision. At the very least this will require warehouses large enough to inspect freight. Locating them away from the border does not mean no border controls, only less effective ones. For the further from the border these are located, the greater the opportunity for cargo to be swapped or stolen”.

What it seems to come to is apart from blinding us with different  claims for different technology,  Lilley is envisaging  a regime in which compliance by trusted traders is the norm; Hayward is describing the border measures needed to anticipate widespread smuggling of goods far beyond the red diesel activity in the border region itself.

On Lilley’s broader point, you might be able to negotiate a conventional free trade treaty with a new partner in his (metaphorical)  ten minutes, but if  you also want to be free to negotiate lots of  other agreements, your former partner will want to nail down one by one the agreements you want to keep with them that might be affected by your  future ambitions, as yet unknown.   And that takes a lot of time and effort.

 

 

 

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