How likely is a no deal Brexit? While insisting he is ready to do it if necessary, the prime minister still says it’s a million to one against. Bookies, pundits and markets all see it as considerably more likely than that.
There’s a lot of road between here and the end of October but no deal feels like a very real possibility. What would it mean for local government?
There’s no single answer to that, of course, because a no deal Brexit is not a singular event. It will be series of shocks that arrive progressively as we do, or fail to do, a series of individual deals with the EU and as the economic and social consequences of these become clearer.
And of course, the impact begins well before 31 October as councils devote considerable time and money planning for an event that may or may not happen and whose precise ramifications are unknown.
After the 31st, there are a set of initial consequences that could unfurl very quickly.
For councils on the frontline such as those in Kent the effects could be immediate. In the run up to the March Brexit deadline they were putting in place traffic management plans, drafting in extra police and working on the assumption that gridlock from the ports would have a knock on effect on schools, hospitals and other public services. Those plans will need to be reactivated for October.
Elsewhere in the country there will be less immediate impact but councils will still be bracing themselves: whatever happens after 31 October there will be large numbers of people unhappy about it.
Local authorities will be reviewing their plans for public disorder and civil unrest. In the very worst-case scenarios, if we do see shortages of food or medicines councils will be thinking about how they protect vulnerable groups such as children and the elderly.
'Local authorities will be reviewing their plans for public disorder and civil unrest. In the very worst-case scenarios, if we do see shortages of food or medicines councils will be thinking about how they protect vulnerable groups such as children and the elderly.'
The sheer range of local authority responsibilities means that pretty much what ever goes wrong they will have a role in dealing with it.
Over the longer term, the prime minister’s commitment to protecting the rights of EU citizens will have reassured local authorities that their workforce will not be instantly decimated, but there are still questions about how far the sudden cessation of free movement effects labour supply – especially in the care sector.
We don’t know exactly how a no deal Brexit will affect the economy: though most predictions are for a slow down. Council finances have been much more closely aligned with economic activity through the retention of business rates so trouble in the retail sector could transfer swiftly to financial shortfalls for local authorities. Again, these effects will be unevenly and unpredictable distributed around the country.
The Shared Property Fund is proposed to replace EU funding not to cover economic stress and in any case we have no details of how it is to work. Will the government’s current round of spending predictions turn in to an attempt to prop up sectors of the economy?
What will the political consequences of no deal be? It’s hard to imagine much domestic legislation be enacted. No deal Brexit will raise questions about the future of the Union and this in turn will reignite debates about English devolution that will closely involve local authorities.
And, given the government currently has a working majority of one, it’s likely that no deal Brexit will be preceded or followed by a general election so councils will have their electoral administration staff on high alert as well.
Perhaps the biggest impact of no deal Brexit then is uncertainty piled on the uncertainty in which councils are already operating. We don’t know how local government will be funded next year. We’ve not had a Spending Review, or the fair funding review, or the detail of how business rate retention will work.
These have already fallen victim to a Brexit paralysis gripping government for which councils are paying a heavy price. On top of this they are now having to prepare for an event which may never happen and which we do not understand, knowing they will pay a political price if their preparation is seen to fall short.
No deal Brexit is not a moment it is a process and for local authorities it is a process that has already begun.
