This Septic Isle

This Septic Isle

Brexit is compounding, not relieving, the UK’s slurry of economic and environmental problems, says Rachel Morris

Sewage-filled waters. Obscene energy price increases and warnings of winter blackouts. Reductions in the quality and quantity of ever-more expensive food. Crops rotting in the fields. Strikes for better conditions by key workers. The NHS ‘winter crisis’ happening in high summer. Rampant inflation. Supply chain issues. Dormant diseases resurgent. Businesses struggling or folding. Hard-won peace in Northern Ireland under threat. Recession.

It sounds like a dystopian film, but this is the UK in summer 2022, even for those with enough money to be cushioned. Examine Maslow’s Hierarchy of Needs: the two foundational bars of the pyramid, basic physiological and safety needs, are being pulled away for more people more quickly than in living memory, like an evil existential game of Jenga.

It should go without saying that a large chunk of this disaster can be attributed Brexit, and, indeed, it does go without saying. The Government certainly doesn’t acknowledge it, and few in the fourth estate do.

Other things are blamed. War in Ukraine, which has affected food prices and energy supplies, making markets more volatile, as well as the ongoing impacts of COVID-19.

The obvious way to determine whether Brexit is involved is to examine countries which haven’t left the trading block, and see how they’re coping with the effects of war and pestilence.

A policy brief by John Springford published by the Centre for European Reform in June does just this, comparing the UK economy with ‘doppelgängers’; a model using countries with economic performance similar to the UK’s during the EU Referendum and Brexit transition periods.

This method allows one to contrast a Brexit UK with one which didn’t leave the EU. By this metric, Brexit made things markedly worse. Springford describes his findings as “sobering”, and in line with Office for Budget Responsibility forecasts that Brexit damage will be greater than COVID, reducing GDP by 4% long term, which the Financial Times estimates will cost £100 billion in lost output and £40 billion less revenue to the Treasury, annually.

UK GDP 5.2% smaller; investment 13.7% lower; goods trade 13.6% lower. Springford notes that a 2.9% drop in GDP appeared between the UK and the doppelgänger model after the referendum but before the pandemic even began; investment lagging from the referendum onwards, and goods trade declining when the UK left the single market. Only inflation is an issue with more global causes and impacts.

---

An Empty Bullet

A nationwide survey by One World Express in January found nearly one-in-three companies afraid that they wouldn’t survive 2022. Despite fears expressed about possible impacts of new COVID-19 variants, Brexit was identified as the central problem, delivering impossible staffing and export problems. 73% said that their business received zero benefits from it.

But forget all that. Forget the fishing and farming industries; overlook the UK lagging behind all other G7 nations in pandemic recovery; that there is more red tape, not less; that airports are in disarray; that care home and hospital staffing is at crisis point.

Let’s play a game of make believe in which Brexit wasn’t instrumental in putting this country on its knees. And examine whether, amid a cost of living crisis so much worse here than elsewhere, whether we can still afford Brexit.

If Brexit didn’t get us into this mess, can it get us out of it?

Boris Johnson, Michael Gove, and Vote Leave campaign chief Gisela Stuart said days before the 2016 Referendum that Brexit would mean lower gas and electricity bills, adding: “The poorest households spend three times more of their income on household energy bills than the richest households spend. As long as we are in the EU, we are not allowed to cut” VAT on energy bills.

While it was true that domestic fuel VAT couldn’t be below 5% due to the bloc’s competition laws, it should be noted it was the UK which imposed the tax, not the EU, in 1993. And six years after Johnson said “we will be able to scrap this unfair and damaging tax”, he steadfastly refused to.

Johnson said repeatedly during the referendum campaign that the UK would take back control of around £350 million per week that it sent to the EU. The promise adorned Vote Leave’s ‘battle bus’, which announced the EU monies would “fund the NHS instead”.

More money is going to the NHS, but it is not Brexit money, and it’s not enough. The service is in a post-Brexit staffing crisis – exacerbated by COVID – leading to poor ambulance performance. Some hospitals are setting up food banks for staff.

Another Brexit promise was the UK being free to agree trade deals with whichever countries it chose, with Johnson saying that the USA would be “first in line”. With a Biden presidency instead of a Trump ‘presidency’, this is far less likely. In May, when the Government threatened to act unilaterally to override the Northern Ireland Protocol, it was rebuked by House Speaker Nancy Pelosi, saying Congress “cannot and will not support a bilateral free trade agreement” if the UK undermines its own Brexit Withdrawal Agreement.

One of the biggest justifications for Brexit, crowed about by both candidates for the Tory leadership, is a “bonfire” of EU regulations. But if you want to continue to export to the EU, the bloc’s regulations still apply.

Domestic deregulation has resulted in water companies filling the country’s shores and rivers with untreated sewage, in part because, thanks to Brexit, they’re struggling to acquire the necessary treatment chemicals. Filthy beaches means reduced tourism, which means less profits for local businesses, which means firms folding or putting prices up.

---

A Wretched Rupture

So, could Brexit help to ease the cost of living crisis? In some ways it could, if promises were kept, or if they had been truthful in the first place.

Yet Brexit “dividends”, so desperately needed now, were a mirage.

On top of which, the country is being put through ‘austerity 2.0’, partly via public service cuts and real-terms pay cuts, partly through Brexit itself, without it ever being named or acknowledged.

For all the talk of ‘levelling up’, a Bloomberg analysis found that “the salary gap is widening in nine out of 10 constituencies, that home affordability is getting worse nearly everywhere, and that public spending per head has fallen behind the capital in every region of England”.

There is a cost of renting crisis that is afflicting the poor and the young across the country, as landlords attempt to insulate their bank accounts from the oncoming economic disaster.

War- and pandemic-related supply chain issues, global inflationary problems – these issues create challenges for some and existential struggles for others. They affect all countries, which are handling them in different ways.

But further misery has been self-inflicted upon the UK by its wretched rupture from the EU. What Brexit claimed to cure it has instead made septic; the outpouring of raw sewage onto popular beaches being an all-too symbolic snapshot of the nation’s condition, and its zombie Government’s dirty, empty promises.