Debate on an e-petition calling for a public inquiry on the impact of the UK's exit from the European Union

Background

The e-petition calls for an independent public inquiry to assess the impact of Brexit on the UK and its citizens, referring to its impact on trade, the economy, opportunities for young people and how it has affected the rights of individuals.

The UK’s exit from the EU and the new UK-EU relationship

The UK left the EU on 31 January 2020. EU rules continued to apply in the UK, as if the UK was still a Member State, until the end of the Brexit transition period on 31 December 2020. The UK-EU relationship is now governed by two principal agreements:

1. the UK-EU Withdrawal Agreement, which dealt with separation issues including the rights of UK and EU citizens resident in each other’s territory at the end of the transition period, the financial settlement, and arrangements to prevent a hard border re-emerging on the island of Ireland (the Northern Ireland Protocol). The Agreement came into force when the UK left the EU on 31 January 2020. The Northern Ireland Protocol has subsequently been amended and supplemented by the Windsor Framework announced on 27 February 2023;
2. The Trade and Cooperation Agreement which sets out arrangements for the new UK-EU trading relationship and cooperation arrangements in other areas including policing and judicial cooperation. The Agreement came into force on 1 January 2021.

The House of Commons Library has produced a range of publications examining the new arrangements for UK-EU cooperation across different policy areas and its impact on particular issues and thematic areas. These are collated on a Library landing page on the post-Brexit UK-EU relationship.

Impact of the UK’s exit from the EU Impact on economy

Brexit is likely to lead to a long-term structural change in the UK economy, affecting areas such as trade, investment and immigration. Many commentators believe it has had an adverse effect on the economy, although some take a different view.

Analysing the impact of Brexit on the economy is, however, complicated by a number of issues. First, it is impossible to know for sure exactly how the economy would have performed if the UK had remained in the EU. Second, other factors, such as the Covid-19 pandemic and the conflict in Ukraine have had a big effect on the economy. This makes disentangling the effect of Brexit more difficult. Changes in the way trade data is collected are an added complication.

The UK left the EU customs union and single market at the end of 2020. While the Trade and Cooperation Agreement allows tariff-free trade between the UK and EU, barriers to trade are now higher than when the UK was an EU Member State. It is also worth pointing out that the UK has yet to introduce full border controls on imports from the EU, having postponed them several times. The Government recently announced its intention to introduce these controls, starting later in 2023.

While the UK has struck new trade agreements with Australia and New Zealand, and recently announced that it will be joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), an Asia-Pacific trade bloc, these agreements are expected to bring relatively limited economic benefits.

Effects on trade and GDP

The Office for Budget Responsibility (OBR), the UK's official independent economic forecaster, assumes that UK imports and exports will both be 15% lower in the long run compared with remaining in the EU. Reviewing this assumption in its March 2023 Economic and fiscal outlook, the OBR concluded that trends in UK trade remained consistent with this view. Data on exports and imports is provided in Commons Library briefing paper, Statistics on UK-EU trade.

The OBR expects productivity, and therefore GDP, to be 4% lower in the long run than if the UK had remained in the EU. The economy is still expected to grow but by less than it would have done. This is mainly due to the OBR’s assumption that Brexit will mean the UK will trade less than if it had stayed in the EU.

Similarly, the Bank of England has stated that leaving the EU is likely to have an adverse effect on productivity through reducing UK-EU trade. It has estimated that Brexit is expected to reduce productivity by 3¼% in the long run relative to remaining in the EU.

John Springford of the Centre for European Reform think tank has created a “doppelgänger UK” economic model, based on countries whose economic performance matches that of the UK before Brexit. This model attempts to estimate the effect of Brexit by comparing this doppelgänger to the UK’s actual economic performance since Brexit. Springford estimates that Brexit reduced GDP by 5.5% by the second quarter of 2022. Investment is estimated to be 11% lower and trade in goods 7% lower, while trade is services is largely unaffected by Brexit.

In a January 2023 report, the think tank UK in a Changing Europe observed that while the effect of Brexit on GDP was a matter of vigorous debate, “there is a widespread consensus that this has been negative.”

Business organisations, such as the Institute of Directors, British Chambers of Commerce and the Federation of Small Business have also reported trade problems arising from Brexit.

Not all economists take the view that Brexit has been harmful to the economy. In a report on the Briefings for Britain website, Graham Gudgin, Julian Jessop and Harry Western concluded “there is no hard evidence that Brexit has had a negative impact on the UK economy.” This report, published in October 2022, argued that there had been no “big hit” or “rupture” to UK exports to the EU.

Gudgin, Jessop and Western argue that the UK has had one of the faster rates of GDP growth of the major economies since 2016. They contest the claim of a strong link between trade and productivity in the UK. The OBR and the Bank of England both refer to this link in their Brexit analysis. The authors also take issue with the doppelgänger approach.

John Springford, who uses this approach, responded to these criticisms. A blog by L Alan Winters of the UK Trade Policy Observatory at the University of Sussex also provides a critique of the Gudgin et al analysis.

Impact on UK citizens: end of free movement

Following the UK’s departure from the EU, UK citizens are no longer citizens of the EU and therefore no longer have EU free movement rights (including the automatic right to travel, live and work across EU Member States). UK nationals are treated as “third country” nationals and are therefore subject to rules of entry to the EU and the wider Schengen area (covering most EU Member States and four non-EU countries). UK citizens are not required to obtain a visa to visit the EU for short-stays but such stays are restricted to 90 days within any 180 day period. The passports of UK citizens entering and exiting EU/Schengen borders need to be stamped to monitor compliance with entry/exit rules.

The implications of the end of free movement for UK citizens and new arrangements for travelling to and living and working in the EU are discussed in the Commons Library briefing paper, After Brexit: Visiting, working, and living in the EU.

The EU is also planning a new entry/exit system which will require the biometric data of UK citizens and other third country nationals to be taken and checked on each visit. UK citizens and other third country nationals will also be required to obtain an advance travel authorisation in order to enter the EU/Schengen area.

More detail on the new EU entry/exit and travel authorisation systems can be found in the Commons Library constituency casework article, The EU Entry/Exit system and EU travel authorisation system. The new arrangements have been delayed and are now expected to be implemented in 2024.

The Withdrawal Agreement included arrangements enabling UK citizens resident in EU Member States at the end of the Brexit transition to continue to reside in their host State and obtain permanent residence. EU citizens resident in the UK could similarly obtain settled status in the UK.

Impact on young people: end of UK participation in the Erasmus programme

The Erasmus programme was launched in 1987 as an education exchange with 11 European members, including the UK. In 2014, the programme became Erasmus+ and expanded to include apprentices, jobseekers, volunteers, sport, and staff and youth exchanges. Today, Erasmus+ encompasses 33 full members (including the 27 EU member states) as well as more than 160 other countries around the world.

The UK’s decision to leave the EU following the 2016 referendum did not necessarily mean it had to end its involvement with the Erasmus+ programme. The UK Government, however, said the terms for continued participation offered by the EU were not in the interests of the taxpayer. Instead, it established the Turing Scheme.

Within the education and youth sectors, disappointment was expressed at the Government’s decision to leave the Erasmus+ programme. The announcement of a replacement scheme in December 2020 was welcomed, but questions have been asked about whether Turing will be able to replicate the benefits of Erasmus+. While the Erasmus+ programme facilitates both outward and inward mobilities for the students and institutions of participating countries, the Turing Scheme only funds placements outside the UK. In addition to the education, training, and work placements offered by the Turing Scheme, the Erasmus+ programme also covers staff development placements, school improvement programmes, youth opportunities, and sport. These activities are not replicated by the Turing Scheme.

Further information about Erasmus+ and the UK’s participation in the programme is available in the Library briefing The Erasmus Programme. More information on Turing, including the responses of the devolved administrations to the UK Government’s decision to leave Erasmus+, is available in the Library briefing The Turing Scheme.

Call for a public inquiry

A public inquiry is a mechanism used to investigate matters of public concern. Typically, they are initiated by a government minister, who appoints an independent chair or panel to examine the issues or events in question, and produce one or more reports. The minister will set the terms of reference of an inquiry (usually but not necessarily in prior consultation with the chair).

Public inquiries can take different forms. Statutory inquiries, for example, mainly take place under the Inquiries Act 2005, and have a standard set of procedure rules and evidence gathering powers. For more information about how decisions are taken in relation to setting-up and running public inquiries, see the following Commons Library briefing papers:

• Statutory public inquiries: the Inquiries Act 2005
• Public inquiries: non-statutory public inquiries

Cabinet Office guidance (PDF) from 2014 sets out some of the factors to be considered by Ministers and civil servants when deciding whether an inquiry ought to be commissioned:

Ministers face a large number of calls for inquiries. Inquiries require a great deal of time and resources, and can place a considerable strain on those involved. It is important that inquiries are only considered where other available investigatory mechanisms would not be sufficient…

Before deciding whether to hold an inquiry, Ministers need to be very clear that the inquiry is affordable within the department’s existing provision and that the benefits of the inquiry – both in the short and longer term – are likely to outweigh the estimated costs of the inquiry.

Calls for a public inquiry into Brexit have, at various points, targeted different aspects of the issue.

• A public inquiry was suggested by Joanna Cherry MP as part of a proposed mechanism to resolve the Parliamentary deadlock in April 2019, but MPs rejected that proposal.
• A previous e-petition, initiated in April 2019 and closing in October 2019, called for a public inquiry into the conduct of the 2016 referendum itself, particularly in relation to alleged influence by foreign actors and governments. The Government rejected calls for such an inquiry when the motion was debated on 5 October 2020 in a Westminster Hall debate.

The current e-petition 628226 calls for a public inquiry into the “impacts” of Brexit, and more specifically on “trade, the economy, opportunities for young people and how it has affected the rights of individuals”. The Government has rejected calls for such an inquiry, stating on 5 December 2022 that:

The UK’s departure from the EU was a democratic choice and the UK-EU institutions are functioning as intended. The Government does not believe this to be an appropriate subject for a public inquiry.

Further reading

House of Commons Library, UK-EU relationship after Brexit (landing page)

House of Commons Library, Brexit timeline: events leading to the UK’s exit from the European Union

House of Commons Library, Reading list of UK and devolved Parliament and Assembly publications on the UK’s withdrawal from the European Union and UK-EU future relations

House of Commons Library, Brexit: a reading list of post-EU Referendum publications by Parliament and the Devolved Assemblies