Photo: Getty
Show Hide image

Could the Irish border bring down the Conservative government?

It's certainly possible.

Well, that didn’t take long: the Democratic Unionist Party has thrown Theresa May's Brexit plans into chaos. Arlene Foster, the party’s leader, reiterated that the DUP will not tolerate the creation of a new border in the Irish sea.

Sammy Wilson, the MP for East Antrim, made the threat explicit in an interview: if the relationship between Northern Ireland and the United Kingdom changes, then their confidence-and-supply deal with the Conservative government will no longer apply. (They are committed to backing the government in three areas: the implementation of Brexit, the passing of money bills (that’s “supply”) and votes of no confidence and the Queen’s Speech – that’s, well, “confidence” funnily enough.)

Are the DUP bluffing?

No. The reason why the DUP are politically successful and have largely crushed the moderate unionist parties in Northern Ireland is that they are always, always wiling to tear the building down if necessary to further their aims.

But I thought the prospect of a Jeremy Corbyn government was anathema to them?

Yes, the DUP are virulently opposed to a Corbyn-led government because of Corbyn, John McDonnell and Diane Abbott’s historical sympathy towards the IRA and the armed struggle in general.

However, the DUP are also virulently opposed to anything which weakens the connection between Northern Ireland and the rest of the United Kingdom. As for which they care about more, the clue is in the title: it’s the maintenance of the United Kingdom, rather than the frustration of one sixty-something political leader.

The DUP won’t be happy if they have to risk a Corbyn government to prevent the Conservatives signing a deal that creates further divisions between Northern Ireland and the United Kingdom.

But they will do it.

Wait, I thought the Conservatives didn’t want a hard border either?

Well, sort of. The important thing to understand about the division between the Conservatives and the DUP is that, bluntly, the DUP understands what the word “border” means and the Conservative mainstream doesn’t.

At the moment, there is a land border on the island of Ireland. But because the United Kingdom and the Republic of Ireland are within the same customs and regulatory union, this border is entirely invisible, and people can cross it at will and without checks. But crucially, someone from Belfast can get on a plane or a boat to London without passing through a border either.

The government’s Brexit strategy – to the extent that word applies – is to leave the customs union and the single market, AKA the customs and regulatory infrastructure of the European Union. So food, goods and (crucially) animals will have to be checked at the customs frontier, ie wherever the United Kingdom decides to begin its regulatory divergence from the EU27.

The government’s solution, according to today’s Times  – and again, the extent to which the word “solution” really applies is a matter for debate – is that Northern Ireland will continue to have the same regulatory and customs system as the European Union, which means there won’t need to be border checks on the island of Ireland.

But, of course, if the rest of the United Kingdom does break away from the customs and regulatory system of the European Union, there will have to be some form of checks for people, goods, food and animals between Northern Ireland and the rest of the United Kingdom. This is by any sensible definition of the word a “border”, and frankly as a compromise it really only makes sense because, again, the Conservatives’ Brexit objectives are not reality-based.

The other problem is that obviously if you are a business, it is in your interest to sell to markets with the same regulatory framework as your own, as it costs less to have only one set of guidelines and standards to meet. (This is why trade deals largely cover regulatory changes and convergence.)

So under this arrangement, Northern Irish businesses would have a greater incentive to trade with businesses in the Republic, weakening ties with the rest of the United Kingdom still further.

Isn’t a hard border bad for the DUP?

No. The DUP’s main political project is the maintenance of the United Kingdom of England, Scotland, Wales and Northern Ireland. (The clue is in the title, remember?)

The success (or depending on your perspective, failure) of the Good Friday Agreement is that it has basically allowed people to ignore the border between Northern Ireland and the Republic. Whether you are instinctively Republican, instinctively Unionist, neither or a little bit of both, you can (to an extent and apologies for the simplification) feel comfortable with the current arrangement. (Scott Gilfillan writes well on the emergence of a new, distinctly Northern Irish identity that this state of affairs has allowed among younger voters there.)

A hard border forces people to choose, and the DUP think that choice favours them. This holds even if there is a severe economic downturn, as the easiest way to escape that will be for people holding both Irish and British passports to move to the Republic, further strengthening the Unionist majority. And in the long term, a hard border encourages economic activity to focus on trading with England, Scotland and Wales, strengthening the union of kingdoms economically.

Unlike the Conservative Party, whose political objectives are hard to reconcile with their Brexit objectives, a hard border can help the DUP.

Can a hard border be avoided?

Yes, provided the government goes back on its Lancaster House objectives and keeps the United Kingdom as a whole in the customs union and signs up to regulatory convergence. Otherwise, you have to have a border either on the island of Ireland (unacceptable to the Republic) or in the Irish Sea (unacceptable to the DUP).

Does this mean we could be headed for another election?

Yes, possibly. To reiterate, the DUP don’t bluff. 

What about the Fixed Term Parliaments Act?

Under the Fixed Term Parliaments Act, there are two pathways to an early election – a two-thirds majority vote for dissolution, or the government loses a motion of confidence. In practice, that means that the government can always get an early election if it wants one, because the opposition parties will always look stupid if they decline the chance to replace the government.

It is harder however for the government to fall as what would, prior to the passage of the Act have constituted a confidence vote (a budget, being defeated on a major issue of foreign policy, losing a Queen’s Speech), now doesn’t. Only a specifically-worded confidence motion brings about a dissolution, and there is 14-day period in which either the government or the opposition can avoid an election if it can pass a second motion declaring confidence in the government.

It is highly likely in that situation that someone would blink and radically reshape their policy stance towards the Irish border in order to avoid an early election which Corbyn would probably win in those 14 days, allowing the government to stay in office.

It’s just that “someone” would be “the Conservative government”, that’s all.

Stephen Bush is special correspondent at the New Statesman and the PSA's Journalist of the Year. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

Getty
Show Hide image

Labour’s renationalisation plans look nothing like the 1970s

The Corbynistas are examining models such as Robin Hood Energy in Nottingham, Oldham credit union and John Lewis. 

A community energy company in Nottingham, a credit union in Oldham and, yes, Britain's most popular purveyor of wine coolers. No, this is not another diatribe about about consumer rip-offs. Quite the opposite – this esoteric range of innovative companies represent just a few of those which have come to the attention of the Labour leadership as they plot how to turn the abstract of one of their most popular ideas into a living, neo-liberal-shattering reality.

I am talking about nationalisation – or, more broadly, public ownership, which was the subject of a special conference this month staged by a Labour Party which has pledged to take back control of energy, water, rail and mail.

The form of nationalisation being talked about today at the top of the Labour Party looks very different to the model of state-owned and state-run services that existed in the 1970s, and the accompanying memories of delayed trains, leaves on the line and British rail fruitcake that was as hard as stone.

In John McDonnell and Jeremy Corbyn’s conference on "alternative models of ownership", the three firms mentioned were Robin Hood Energy in Nottingham, Oldham credit union and, of course, John Lewis. Each represents a different model of public ownership – as, of course, does the straightforward takeover of the East Coast rail line by the Labour government when National Express handed back the franchise in 2009.

Robin Hood is the first not-for-profit energy company set up a by a local authority in 70 years. It was created by Nottingham city council and counts Corbyn himself among its customers. It embodies the "municipal socialism" which innovative local politicians are delivering in an age of austerity and its tariffs delivers annual bills of £1,000 or slightly less for a typical household.

Credit unions share many of the values of community companies, even though they operate in a different manner, and are owned entirely by their customers, who are all members. The credit union model has been championed by Labour MPs for decades. 

Since the financial crisis, credit unions have worked with local authorities, and their supporters see them as ethical alternatives to the scourge of payday loans. The Oldham credit union, highlighted by McDonnell in a speech to councillors in 2016, offers loans from £50 upwards, no set-up costs and typically charges interest of around £75 on a £250 loan repaid over 18 months.

Credit unions have been transformed from what was once seen as a "poor man's bank" to serious and tech-savvy lenders where profits are still returned to customers as dividends.

Then there is John Lewis. The "never-knowingly undersold" department store is owned by its 84,000 staff, or "partners". The Tories have long cooed over its pledge to be a "successful business powered by its people and principles" while Labour approves of its policy of doling out bonuses to ordinary staff, rather than just those at the top. Last year John Lewis awarded a partnership bonus of £89.4m to its staff, which trade website Employee Benefits judged as worth more than three weeks' pay per person (although still less than previous top-ups).

To those of us on the left, it is a painful irony that when John Lewis finally made an entry into politics himself – in the shape of former managing director Andy Street – it was to seize the Birmingham mayoralty ahead of Labour's Sion Simon last year. (John Lewis the company remains apolitical.)

Another model attracting interest is Transport for London, currently controlled by Labour mayor Sadiq Khan. TfL may be a unique structure, but nevertheless trains feature heavily in the thinking of shadow ministers, whether Corbynista or soft left. They know that rail represents their best chance of quick nationalisation with public support, and have begun to spell out how it could be delivered.

Yes, the rhetoric is blunt, promising to take back control of our lines, but the plan is far more gradual. Rather than risk the cost and litigation of passing a law to cancel existing franchises, Labour would ask the Department for Transport to simply bring routes back in-house as each of the private sector deals expires over the next decade.

If Corbyn were to be a single-term prime minister, then a public-owned rail system would be one of the legacies he craves.

His scathing verdict on the health of privatised industries is well known but this month he put the case for the opposite when he addressed the Conference on Alternative Models of Ownership. Profits extracted from public services have been used to "line the pockets of shareholders" he declared. Services are better run when they are controlled by customers and workers, he added. "It is those people not share price speculators who are the real experts."

It is telling, however, that Labour's radical election manifesto did not mention nationalisation once. The phrase "public ownership" is used 10 times though. Perhaps it is a sign that while the leadership may have dumped New Labour "spin", it is not averse to softening its rhetoric when necessary.

So don't look to the past when considering what nationalisation and taking back control of public services might mean if Corbyn made it to Downing Street. The economic models of the 1970s are no more likely to make a comeback then the culinary trends for Blue Nun and creme brûlée.

Instead, if you want to know what public ownership might look like, then cast your gaze to Nottingham, Oldham and dozens more community companies around our country.

Peter Edwards was press secretary to a shadow chancellor, editor of LabourList and a parliamentary candidate in 2015 and 2017.