An EEA/EFTA Brexit model would actually solve Theresa May’s problems – here’s how

It ​keeps the benefits of the single market, yet takes the UK out of the common agriculture and fisheries policies. But most importantly, it eases a number of the significant concerns with the prime minister's deal

The Bank of England has predicted that if the UK departs the European Union without a deal, Britain would face a recession worse than that experienced during the global financial crisis. Our economy would shrink, it estimates, by approximately 8 per cent by 2023.

Theresa May is likely to use this stark warning to try and sell her Brexit deal – which she will put to the House of Commons on 11 December – as a choice between her agreement and the disastrous consequences of no-deal. Given that time has all but run out for a renegotiation, some MPs may feel forced into backing May. But there is another option: taking a pre-made, off the shelf model.

The European Economic Area (EEA)/European Free Trade Agreement (EFTA) model could be the UK’s saviour, and, as Catherine Barnard, a senior fellow at the UK in a Changing Europe initiative and professor of EU law at University of Cambridge, says, “given how catastrophic a no deal scenario would be, joining the EEA/EFTA in some form would provide a valuable safety net."

As a model, EEA/EFTA keeps the benefits of the single market, yet takes the UK out of the common agriculture and fisheries policies. But most importantly, it eases a number of the significant concerns with May’s deal. The Irish backstop problem – which Brexiteers worry ties the UK to Europe almost indefinitely – is no longer an issue under an EEA/EFTA deal as there is no need for a backstop as long as the UK signs up to an interim customs union.

Worries about the continual influence of the European Court of Justice (ECJ) are also answered, as the UK would be under the EFTA court (the Surveillance Authority) instead. The EEA/EFTA also changes how financial contributions to the EU are made, with money going directly to the agencies the UK is participating in, as opposed to the European Commission.

The practicalities of joining are not overly complicated for Britain. To join the EFTA, the UK will need to gain the approval of current members, i.e. Norway, Iceland, Switzerland and Liechtenstein. Sam Lowe, senior research fellow at the Centre for European Reform, says that current members are likely not to want a transient UK joining their club, destabilising it and leaving in a few years. Instead of joining as a full member, the UK could ask to be an associate and, as the voting structure in the group provides each state with a veto, the UK could opt out of this to ensure this balance is not disrupted.

As for EEA, the UK is already a member, but through the EU. So once Britain leaves, a reapplication will be needed. Applying again as an EFTA state is likely to increase the chances of success and it would be highly unlikely for the UK to be turned away.

An arrangement like this would provide the UK the time and space to negotiate a future relationship from a position of relative strength, but behind closed doors some leading Brexiteers have expressed worries that the UK will never escape an EEA/EFTA transition. They say it will be too comfortable, as Remainers will view it as a good middle ground, while Leavers will be appeased as Britain will have left the EU, and business will be satisfied.

They worry this comfort will lead to the UK staying in this permanent limbo, but Nick Boles, a Tory MP who is a firm proponent of EEA/EFTA for the transition period, says it would be possible to satisfy these concerns by enshrining a leaving date. He says: “Parliament could pass an act that would see the government giving notice to the EEA, giving our intention to quit in April 2021.” That decision would be in the hands of parliament and would not require negotiations with an external party. But, if needed, parliament could indeed change it.

Not only does the EEA/EFTA potentially offer a solution to Theresa May’s problems, it might be the only thing that can save us come March 2019.