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Brexit: What Will We See In 2017?

Since the vote to leave the EU on 23 June, the news has been dominated by Brexit. We’ve had rolling coverage of every statement about trade, single market membership and freedom of movement. 2017 is the year we will see things come to a head, and a picture will emerge of the UK outside of the EU.

Here are three things we can expect.

1. Article 50 will be triggered by March, and we will finally see some Brexit plans.

The Brexit conversation so far has been confusing and unclear, with very little information from ministers. This week we’ve seen reports that almost no decisions have been made by Theresa May’s Brexit cabinet yet, and they will be waiting until March to do so, or making decisions during negotiations. Meanwhile, research also released this week expresses concerns about the lack of coordination between civil servants in different departments, with secrecy at the top making it very difficult to plan for Brexit.

However, after some political manoeuvring in parliament last week, MPs voted overwhelmingly in support of a motion to trigger Article 50 by the end of March, and to publish a Brexit plan. This means that not only can we expect May to meet her deadline, but that in 2017 the government will have to present some post Brexit plans or priorities to MPs. 

We should hope that the government releases these plans as early as possible next year, so that the left can analyse and challenge May’s plans for post-Brexit Britain.

2. We will start to see the economic effects of Brexit.

During the referendum campaign, there were many claims made about the economic consequences of Brexit. Not enough time has passed yet to fully understand what it means for the UK economy, so 2017 is the year we will start to see the effects of Brexit.

In November, the Bank of England projected that consumer price inflation will rise to 2.7% by the end of 2017, higher than earlier forecasts. This means price rises in shops, as suppliers and supermarkets pass on price rises to customers, and an increase in the cost of living.

Last month we saw the first rows about price increases in UK supermarkets, which have been in an intense price war for quite some time. Unilever, a large supplier of household brands in the UK, allegedly wanted to raise prices by up to 10% because of the falling value of the pound after Brexit, and their products weren’t stocked by Tesco for several days.

Much of the economic impact of Brexit will depend on the eventual deal we have with the EU, including single market membership and membership of the customs union. 2017 is the year we will start to see the Brexit plan emerge, and have a clearer idea of the long term impacts on our economy (see point 1).

3. Immigration will continue to dominate the agenda.

Immigration dominated the referendum campaign, and the issue may well come to a head next year. As already noted, May has stated that reforming freedom of movement will be a red line in negotiations, and we should be finding out what the government’s position will be next year.  

After the referendum, there has been pressure on the government to reduce immigration and end freedom of movement, and we’ve seen tensions about immigration translate into rising hate crimes on our streets.

There are approximately three million EU citizens in the UK under freedom of movement rights, and May has so far refused to guarantee their position. This also means that the 1.2 million UK citizens living in the rest of the EU are in limbo, and have no guarantee about their right to stay. 

We also know that EU migrants make a net contribution to the UK economy, and do vital jobs: in the NHS, 10% of our doctors and 4% of our nurses are from other EU countries. If the government accepts anti-immigration sentiment with no consideration of evidence, we could see damage to our economy, our NHS and communities in the UK. 

However, May has stated that reforming freedom of movement will be a red line for the government, while also stating that single market membership hasn’t been ruled out. As I set out in a previous blog, single market membership and freedom of movement are a package deal – next year we will find out if the government will sacrifice single market membership for reforming or ending freedom of movement, despite protestations from business.

 

After months of speculation and very little detail, next year we will see some form of plan and the start of a tense negotiation period before we leave the EU. When the post-Brexit plan becomes clearer, we will also finally have a fuller understanding of the long term impacts on our economy, and on immigration. Overall, it’s becoming clear that 2017 is going to be a big year, and the stakes are high.

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