After Brexit we should have gone Swiss. Now we have no option but to go Singaporean

The pigheadedness of the EU – and the hardening of debate in Britain – thwarted a sensible deal from being reached. Audacity is now the only choice

Brexit has already worked. The European Communities Act has been repealed. The next general election will be the first since June 1970 to return a sovereign parliament. We have recovered the right to hire and fire our own lawmakers.

When people ask what Brexiteers were really voting for, they miss the point. Brexiteers were voting to leave the EU, which (after some shenanigans) we did. Everything else is secondary.

Secondary does not mean unimportant, of course. How we use our commercial and regulatory freedoms will, in large measure, determine our prosperity. But we need to separate the fact of taking back our independence from the question of how we use it. If, for example, you believe that the labour shortage is contributing to our economic woes, then you are arguing for a more liberal immigration policy; you are not arguing against Brexit per se.

The distinction matters. Before 2016, Europhiles used to accuse Brexiteers of blaming every inconvenience on Brussels. Now, they are at it themselves. Never mind policy errors, such as building too few houses, imposing excessive taxes or pursuing decarbonisation too quickly. Never mind the £400 billion dropped on the lockdowns. Everything must be the fault of Brexit.

Our debate has consequently become skewed. Policies are chosen, not on their merit, but on what Brexit vibes they give off. Every clod of mud is contested like some piece of no-man’s-land in 1916. Eurosceptics rail against intergovernmental ties with the EU which imply no loss of sovereignty. Europhiles oppose trade deals with third countries which, in any other circumstances, they would wholeheartedly applaud.

After we voted to leave, we had two credible paths before us. We could have gone all-out for divergence, cutting taxes, scrapping regulations and seeking to poach business from across the Channel (let’s call it the Singapore approach). Alternatively, we could have loosened our political ties with the EU but left our economic ties in place, staying in parts of the single market and seeking to revive the European Free Trade Association (EFTA) as an alternative for countries that reject deeper integration (let’s call it the Swiss approach).

Both options had drawbacks. Everything in this sublunary world has drawbacks. The Singapore option implied a sudden jolt, a disruption of our EU trade, higher short-term costs for greater long-term gains. The Swiss option would have minimised those costs and obviated most of the problems associated with the Irish border, but would have meant carrying on with the free movement of labour.

What we have instead ended up with gives us the worst of both worlds. We insisted during the negotiations on full regulatory autonomy, and then refused to use it. We allowed trade barriers to be erected at the Channel, but kept EU commercial standards anyway, intimidated by idiotic scare stories about “chlorinated chicken”. We demanded Singaporean freedoms, but then raised taxes on business, hiked social security spending and imposed more aggressive eco-targets than the EU. Having made a song and dance about controlling our borders, we refused to withdraw from the international conventions that prevent us from turning away small boats in the Channel.

Partly because I foresaw such difficulties, I was for a Swiss-type deal before, during and after the referendum. Europhile commentators and MPs like quoting my columns as evidence of my having changed my mind, but I always saw a broadly Helvetic outcome as the easiest way to get Brexit done swiftly and painlessly.

Resuming our leadership of EFTA would have taken away the cliff-edge of no deal, so strengthening our hand in the talks. It would have left us outside the Common Agricultural and Fisheries Policies, free from the jurisdiction of the European Court, able to strike our own trade deals. It would have placed Britain at the head of an outer ring of European states that wanted to retain their sovereignty – a status that might, in time, have appealed to some existing EU members. Being off-the-peg, it would have been quick to agree, sparing us years of bitter wrangling.

In the early hours of June 24 2016, I told the BBC results programme that, given the narrowness of the outcome, we should move slowly. Brexit, I said to David Dimbleby, would be “a process, not an event”. We would leave the EU’s political structures but stay in many of its market arrangements.

No one found my interview controversial. Nor did anyone balk when Boris Johnson wrote an article in The Telegraph two days later making the same argument. Nothing much would change, he said, except that we would recover our sovereignty from the politicised European Court.

So why didn’t it happen? Why did the EFTA compromise that seemed inevitable in the days after the referendum become unthinkable? There were three factors at work.

First, EU leaders were determined to reject whatever Britain asked for. If we had tried to give them the Isle of Wight, they would have said “no cherry-picking”. When Theresa May offered, at the 2018 Salzburg summit, to follow their rules in perpetuity and pay for the privilege, they reflexively refused. Whether they believed they could overturn Brexit, or whether they simply could not bear to agree with her, they ended up saying no to the best offer they were ever going to get. It seems clear, in retrospect, that they would not have allowed a Swiss deal without adding deliberately provocative conditions, such as membership of the customs union or the Common Fisheries Policy.

The idea that Britain might end up as a market-only member, the leader of a “ring of friends”, with joint institutions to administer common norms – initially popular in Brussels – was lost through pique. Instead of expanding the Swiss model, Eurocrats decided to take it away from Switzerland, driving that country further away from the EU.

The second factor was Mrs May’s accidental premiership. Like most people who voted Remain, she could not understand why anyone had backed Leave other than from hostility to immigration. She prioritised border control over every other issue, including competitiveness and sovereignty.

The third was the polarisation that followed the result. Peter Mandelson blamed Remainers for collapsing the Swiss option in pursuit of a second referendum, but Leavers were no less uncompromising. The ERG, which in the early 2000s wrote papers lauding EFTA, now called that arrangement betrayal. When I shared a platform with Nigel Farage during the referendum, he lavished praise on countries that were more embedded into EU structures than Switzerland: “Wouldn’t it be awful to be like Norway? Wouldn’t it be awful to be rich and free?” Yet he was soon dismissing EFTA as a “sell-out”.

For all these reasons, the Swiss option is off the table – even, these days, for Switzerland. The unnamed Cabinet minister who proposed it last week was dancing after the music had stopped. The PM was ruling out an option whose time had passed. The chief attractions of going Swiss were that it would have eased the transition, facilitated a quick deal, anticipated the Irish problem and headed off a culture war. None of that is now relevant.

We therefore have to make divergence work. We need to push ahead with the scrapping of EU laws

– a project now being held up by civil servants who, though they won’t say so, want an incoming Labour government to agree to dynamic alignment with Brussels (ie adopting whatever future laws the EU passes). We should sign trade deals that comply with WTO rules, some of which are directly in conflict with EU practice, especially in agri-foods, where Brussels imposes numerous unscientific bans on protectionist grounds. We should cut taxes.

When it comes to immigration, we must above all deport illegal entrants, whether to Rwanda, France or their countries of origin. It is the flouting of the system, rather than the numbers, that causes public disquiet. The recent spike in legal migration reflects the return of foreign students and workers after the pandemic, as well as the international situation (we have admitted 89,000 Ukrainians, 76,000 Hong Kongers and 21,000 Afghans). But it is impossible to win consent for controlled migration while the boats crisis continues.

Pursuing competitiveness now would allow a future administration to agree to closer intergovernmental ties with the EU as a sovereign equal. But Brussels no longer cares. As far as Eurocrats are concerned, they need only wait for a Starmer-led government to give them what they want. And they are probably right.

We have to make divergence work. We need to push ahead with the scrapping of EU laws and sign trade deals