Time to get unilateral: what London needs from the Brexit negotiations

Well, this is awkward. Image: Getty.

Article 50 marks the moment when the UK’s departure from the European Union turned from distant prospect to dogged process. However you voted in the referendum last year, Brexit just got real.

And with that reality, there is the promise of clarity. All of these terms – customs union, free trade area, the four freedoms, the acquis communautaire – that have become part of public debate in recent months will start to become the raw material of negotiation. Ironically, we have begun to understand the intricacies of the European Union just as we start disentangling ourselves from its treaties, its regulations and its institutions. 

At long last, we will know where we stand. But clarity will take time, despite Prime Minister Theresa May’s emphasis, in her letter to European Council president Donald Tusk, on the importance of providing certainty. Fewer and fewer politicians and pundits seem optimistic that we can both achieve a separation agreement and a comprehensive negotiation of a new relationship in the space of 18 months, allowing for six months for agreements at the end of the process, and with French and German elections adding complexity.

What happens in airless Brussels committee rooms over the next 18 months will be important to the future of everyone in London and the UK. But we mustn’t overlook what will be happening in our towns and cities before then, where the decisions of hundreds of firms and thousands of individuals may be just as important to our future as the machinations of mandarins.

In London, hardly a day goes by without media reports of companies gently testing out the possibility of setting up in other European capitals, maybe sending a few staff over to Frankfurt, Dublin or Paris, maybe taking out an option on offices.  Aside from a few pre-planned moves that were opportunistically badged as the “consequences of Brexit”, most London employers have so far been taking a cautious “wait and see” approach to future plans.

But as they consider the possibility of leaving the EU without a trade deal – and contemplate the small but vocal posse of politicians who regard that as a wholly desirable outcome – the calculus of risk begins to shift.  As a recent House of Lords report set out, World Trade Organisation rules are very unattractive for many of the service sectors in which London excels.  The problem for these sectors is not so much the tariffs that will hit manufacturing and agricultural exports, but regulations that seek to ensure that services provided across European boundaries meet common standards.

UK broadcasters could be barred from distributing content aboard; banks could find themselves locked out of EU markets; tech firms could be unable to share data across borders. UK airlines could be prevented from running passenger services within the EU, and lawyers, accountants and other professionals could find their qualifications were no longer recognised overseas.

Many of these restrictions would be almost as damaging to other EU countries as to the UK, and with time and goodwill new trading arrangements can be put in place.  But time is in short supply, and goodwill may be tested in coming months. In these circumstances, a lose-lose outcome is a real possibility. In the meantime, uncertainty may force the issue.


European workers in the UK will also be thinking about their options.  The more that the status of EU citizens living in the UK is left uncertain (and the more stories of people being refused leave to remain by an overwhelmed Home Office), the more likely they are to consider relocation. This is a particularly important issue for London, where more than 12 per cent of workers are from elsewhere in Europe, but it also matters for employers in the agricultural heartlands of the East Midlands. 

And it is mirrored by anecdotes of lawyers and scientists turning down jobs in London because of the uncertainty about their future status and their families’, and by statistics showing a slowdown in migration of higher skilled workers from the continent. If uncertainty means that employers can’t attract the high-skilled European workers they need, the balance will tip further against London.

The Centre for London’s forthcoming report on the implications of Brexit for the capital argues that London – and other UK nations and regions – urgently need short-term clarity, to prevent the trickle of relocations from turning into a flood, making Brexit look like a failure before it has even happened.

There needs to be a clear statement, unilateral if necessary, that current EU residents can stay, and a clear interim position on trade. Membership of the European Free Trade Area might be sought as an interim measure, enabling continued access to the single market in current terms while new ones were negotiated.

This would mean the UK was still bound by EU regulations, but this will only mirror the provisions of the proposed Great Repeal Bill that will adopt current EU regulations wholesale.  It would probably be greeted by jeers of “Betrayal!” by Ukippers and their fellow-travellers in the Conservative Party – but the Prime Minister will need to face down these fringe elements sooner or later, unless she wants to lead us to the harshest of hard Brexits.

London leads the world in services from banking to restaurants to pop music to advertising.  These clusters of expertise have proved remarkably resilient, and it will take more than a few departures to weaken them. But it would be catastrophic if uncertainty led to London losing its edge while the details of Brexit were still being hammered out.

Richard Brown is Research Director at Centre for London. He tweets as @MinorPlaces.

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More than 830 cities have brought essential services back under public control. Others should follow

A power station near Nottingham: not one owned by Robin Hood Energy, alas, but we couldn't find anything better. Image: Getty.

The wave of cities worldwide rejecting privatization is far bigger and more successful than anyone thought, according to a new report from the Transnational Institute, Reclaiming Public Services: How cities and citizens are turning back privatisation. Some 835 cities in 45 countries have brought essential services like water, energy and health care back under public control.

The persistent myth that public services are by nature more expensive and less efficient is losing its momentum. Citizens and users do not necessarily have to resign to paying increasingly higher tariffs for lower standard services. The decline of working conditions in public services is not an inevitability.

And the ever larger role private companies have played in public service delivery may at last be waning. The remunicipalisation movement – cities or local authorities reclaiming privatised services or developing new options – demonstrates that cities and citizens are working to protect and reinvent essential services.

The failure of austerity and privatisation to deliver promised improvements and investments is part of the reason this movement has advanced. But the real driver has been a desire to meet goals such as addressing climate change or increasing democratic participation in service provision. Lower costs and tariffs, improved conditions for workers and better service quality are frequently reported following remunicipalisation.  Meanwhile transparency and accountability have also improved.

Where remunicipalisation succeeds, it also tends to inspire other local authorities to make similar moves. Examples are plentiful. Municipalities have joined forces to push for renewable, climate-friendly energy initiatives in countries like Germany. Public water operators in France and Catalonia are sharing resources and expertise, and working together to overcome the challenges they meet.

Outside Europe, experiments in public services are gaining ground too. Delhi set up 1,000 Mohalla (community) clinics across the city in 2015 as a first step to delivering affordable primary health care. Some 110 clinics were working in some of the poorest areas of Delhi as of February 2017. The Delhi government claims that more than 2.6m of its poorest residents have received free quality health care since the clinics were set up.


Local authorities and the public are benefiting from savings too. When the Nottingham City Council found out that many low-income families in the city were struggling to pay their energy bills, they set up a new supply company. The company, Robin Hood Energy, which offers the lowest prices in the UK, has the motto: “No private shareholders. No director bonuses. Just clear transparent pricing.”

Robin Hood Energy has also formed partnerships with other major cities. In 2016, the city of Leeds set up the White Rose Energy municipal company to promote simple no-profit tariffs throughout the Yorkshire and Humberside regions. In 2017, the cities of Bradford and Doncaster agreed to join the White Rose/Robin Hood partnership.

Meanwhile, campaigners with Switched on London are pushing their city to set up a not-for-profit energy company with genuine citizen participation. The motivations in these diverse cities are similar: young municipal companies can simultaneously beat energy poverty and play a key role in achieving a just and renewable energy transition.

Remunicipalised public services often involve new forms of participation for workers and citizens. Remunicipalisation is often a first step towards creating the public services of the future: sustainable and grounded in the local economy. Inspiration can be found in the European towns and villages aiming for 'zero waste' with their remunicipalised waste service, or providing 100 per cent locally-sourced organic food in their remunicipalised school restaurants.

Public services are not good simply because they are not private. Public services must also continuously renew themselves, grow, innovate and recommit to the public they serve.

The push for remunicipalisation in Catalonia, for example, has come from a movement of citizen platforms. For them, a return to public management is not just an end in itself, but a first step towards the democratic management of public services based on ongoing civil participation.

Evidence is building that people are able to reclaim public services and usher in a new generation of public ownership. The momentum is building, as diverse movements and actors join forces to bring positive change in communities around the world.

You can read the Transnational Institute report, “Reclaiming Public Services: How cities and citizens are turning back privatisation”, on its website.