What does a no-deal Brexit mean?

30 Aug 2018 Siobhan McAlister    Last updated: 31 Aug 2018

Last week, Brexit Secretary Dominic Raab published guidance setting out some of the things that a no deal Brexit could mean for people, businesses and industry in the UK. 

The guidance was made up of 24 technical notes covering areas in medicine, finance and agriculture and others. 

NICVA takes a look at what a no deal could mean for Northern Ireland...

 

1. No transition period after we leave EU on 29th March 2019

As part of the UK’s negotiations with the EU, a transition period has been proposed to last from 29th March 2019 until the end of December 2020. The intention of the transition period is so that the UK can adapt to new rules, regulations and arrangements and work out what the UK’s future relationship with the EU will look like, including the terms and costs of trading with other EU countries (including ROI). However, this transition period is dependent on the UK reaching a deal with the EU. If there is no deal, there is no transition and the UK will leave the EU as a ‘third country’ without the trade and other arrangements it currently has with other EU countries on the 29th March 2019. This means no agreement on the Irish border and potentially huge disruption to people and businesses here, with new arrangements needing to be in place from 30th March 2019.

 

2. Impact on peace and stability and potential hardening of the border on the island of Ireland

In the event of a no deal, there could be a requirement for a hard border/border infrastructure between Northern Ireland and the Republic of Ireland. The EU’s backstop option for Northern Ireland (which involves NI remaining in the EU customs union and single market) has been regarded as unacceptable to the UK government. A no deal would put an EU obligation on the Republic of Ireland to put up a customs barrier to protect the EU from sub-standard goods. The UK would also be obliged by the World Trade Organisation to erect its own border.

There could also be repercussions for the peace process here. The peace process in Northern Ireland is still considered fragile and an ongoing process, a hard border could mean infrastructure and potentially security or border personnel at the border. Not only could the presence of border infrastructure be a target for dissident activity, it could also have the potential to have political, psychological and emotional impacts here. The existence of an invisible border was fundamental in the peace process and helped to create better relations across the island and paved the way forward for a peace agreement and power-sharing government. Any change to the status of the border has the potential to disrupt the progress made in Northern Ireland.

3. Disruption to the Northern Ireland economy

For many businesses in Northern Ireland, their supply chain and goods cross the border multiple times before becoming final products, a no deal and a hard border would have significant impact on business, including the large amount of many small and medium enterprises (SMEs) that exist in Northern Ireland, of which only 5% have a Brexit plan in place. In the guidance issued by the UK government this week, Northern Ireland businesses have been told to start making preparations for a no deal by contacting the Irish government for advice. It was also highlighted that there could be a requirement to apply the same customs and excise rules to goods traded with the EU that apply for those trading outside the EU. This means that businesses in Northern Ireland may need to get special software, engage a customs broker, freight forwarder or logistics provider to support them with new requirements- all which will come at a cost.

The Northern Ireland agriculture sector may also be disproportionately impacted by the absence of any deal. Local farmers have highlighted their concerns that a no deal Brexit could wipe out sheep farming which, along with beef farming, makes up 80% of farming here. This is due to the large amount of produce exported to the French market which could suffer catastrophically if high tariffs are imposed due to failure to reach any agreement. The Ulster Farmers Union (UFU) has called for a trade agreement that would ensure a no-deal scenario is avoided. As well as the impact on trade, farmers here will be hit by the loss of Common Agricultural Policy (CAP) funding which makes up around 82% of farmers income in NI. There still remains uncertainty around what will replace this funding as well as other EU structural funds in the future.

 

4. Threat to our social and economic rights

In the event of a no deal Brexit, the rights of EU citizens living in the UK and UK citizens living in EU countries would not be protected and there would be much uncertainty around their future status. Although it has been said that the Common Travel Area will continue to operate, this arrangement is not legally binding which again leads to uncertainty around how free movement can be protected on the island of Ireland, especially for non-UK/Irish citizens living on the island. Northern Ireland residents also risk losing certain citizenship rights if no deal is reached and this includes voting rights, access to EU student fees, access to European health insurance card and many more.

 

5. Detrimental impact on healthcare

If a hard border were to be implemented on the island, this would throw up many difficulties for cross border healthcare , especially for those healthcare workers who cross the border on their commute every day. There is also a risk to continued access to cross-border healthcare services currently underpinned by the UK governments reciprocal arrangements with the Irish and other EU governments under EU rules and to cross-border cooperation in relation to specialist services including cancer services in the North West and cardiac paediatric care in Dublin. The ongoing uncertainty around Brexit negotiations and the increasing threat of a no deal is also having an impact on recruitment and retention of healthcare staff, especially those staff from the EU including the Republic of Ireland. This is concerning in a system which is already under increasing pressure.

 

6. Weakened environmental protection

EU environmental legislation and protection arrangements, including arrangements for cross-border management between Member States, currently play a critical role in protecting the quality of our environment. Without this EU framework and the deterrent to environmentally damaging activities which the threats of infraction fines from European courts provide, there are concerns that environmental protection here will be greatly weakened. The fact that Northern Ireland has no independent environmental protection agency further adds to these fears for some.  The natural environment does not respect borders and therefore it is worrying that under the post-Brexit arrangements currently being proposed,  there are no clear proposals for cross-border or all-island frameworks for environmental protection that would replace the current EU cross-border frameworks and mechanisms designed to manage our cross-border environmental management challenges, such as protecting the water quality and biodiversity of our cross-border lakes, rivers and seas, and the management of our waste.

siobhan.mcalister@nicva.org's picture
by Siobhan McAlister

Policy Development Officer

[email protected]