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6 October 2016

Something was missing from Theresa May’s speech

The government's Brexit objectives will wreck its social justice mission. 

By Stephen Bush

One of the reasons why Theresa May kicked off Conservative party conference with a speech on Brexit and what happens next was to avoid speculation about it dominating the affair and crowding out the message that Downing Street wants to get out.  That was particularly true of her speech yesterday, which largely eschewed talking about Brexit in order to get out her “a country that works for everyone” message.

But here’s the problem: you can’t separate the government’s mission from Brexit, however much May might like to. We now have a pretty clear idea what the government will put first in its negotiations with the remaining 27 nations of the European Union: border control. As Angela Merkel reiterated yesterday, the European Union is not going to do a deal with Britain that involves them to have the benefits of the single market while avoiding one of the four freedoms. And anyone who thinks that the political pressure from Germany will lessen after the German and French elections is kidding themselves: and assuming that Marine Le Pen is seen off her bid to become France’s next President, whoever emerges as France’s new leader will be desperate to avoid giving Le Pen further ammunition, and giving a good deal to the British will absolutely give Le Pen further ammunition. (That, regrettably, is very much the best case scenario. The worst case scenario is that Le Pen wins and the European Union enters a state of fatal decay, making any question of a hard or soft Brexit moot.)

So Britain will not be in the single market. Senior figures at most British and British-based banks are increasingly of the opinion that they will not get a decent deal on passporting. That will rebalance the British economy away from London, but not in a way that raises living standards in the North and Midlands.

A strange spell has fallen over most politicians. With a few exceptions – Philip Hammond is one, Liz Kendall another, Pat McFadden a third – the centre of gravity has moved to a position that without an end to freedom of movement, Britain’s membership of the single market is a goner. (The Labour leadership has the reverse position – supportive of free movement, but opposed to remaining in the single market.)

That puts Britain in a unique position in the democratic world – of being a country where economic policy is driven by immigration policy. It’s a bold experiment, certainly.

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But the truth that Theresa May’s government is going to have to grapple with is this: you can’t build a country that works for everyone if you don’t have an economy that works for everyone, and you can’t build an economy that works for everyone if you don’t have an economy that works.  

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