George Osborne's Conservative fringe appearance: 10 things we learned

Including, his parents were non-Tory voters and Gordon Brown is the only politician "he found it impossible to have a civil relationship with".

It's been a while since anyone called George Osborne "the submarine" - and with good reason. The man previously known for surfacing only for set-piece events and retreating under water at the first sign of trouble, has become one of the government’s most visible faces. In the last year, he has made a series of high-profile speeches on the economy, taken the fight to Alex Salmond in Scotland, and braved the world of Twitter. The morning after the government’s defeat over Syria, it was the Chancellor who led the counter-offensive on the Today programme.

After his strikingly personal speech to the Conservative conference yesterday, in which he referenced his children and his parents (seen by many as preparing the ground for a future leadership bid), Osborne made a rare appearance on the fringe at lunchtime, speaking to Channel 4 News's Gary Gibbon. Here are ten things we learned.

1. His mum has voted Labour and his dad used to vote Liberal but both now vote Conservative.

2. Gordon Brown is the only politician "he found it impossible to have a civil relationship with".

3. He believes the Tories "never really" worked out how to deal with Tony Blair, "the master of the political landscape", and "need to understand why he was appealing".

4. He conceded of the 2012 "omnishambles" Budget: "in my job you're not supposed to make those political miscalculations."

5. After pledging in his speech to achieve a budget surplus by the end of the next parliament, he has not decided whether to continue to ring-fence health and international development spending.

6. Nigel Lawson's children helped persuade him to move his family to No. 11 Downing Street.

7. He sees himself as "a social liberal, small 'l'" and cited his strong support for equal marriage and gay rights.

8. He "does not want to run the election campaign" (Osborne is still officially the Tories' chief election strategist), "which is why we've got Lynton Crosby in. I was the one who approached him."

9. While refusing to comment on his reported leadership ambitions ("I'm not going to fall for that"), he believes that as Chancellor he has "an obligation to get out and about".

10. Michael Gove joked (brilliantly) of his new hairstyle: "you've applied your economic policy to your hair. You've turned it around to stop the recession."

George Osborne delivers his speech to the Conservative conference in Manchester. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.