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The UK agreed to open its fishing waters for 12 more years to EU boats — a move that will be condemned by the opposition Conservatives — according to Brussels officials.

In return, UK Prime Minister Sir Keir Starmer has secured a veterinary deal that will remove much red tape for British farming and fisheries exports to its biggest market, in a much-sought economic prize of the “reset” talks.

Five years after the UK left the European Union on 31 January 2020, the country is still adjusting to life outside the bloc.

Brexit has strained small businesses more than big ones, changed university campuses and the NHS, and contributed to a three-way fracture in the British political firmament following a post-Brexit surge in legal migration. With Sir Keir Starmer committed to a “reset” of relations with the EU, how far could his negotiations with Brussels change life in Britain?

Education

One of the EU’s central demands is the introduction of a youth mobility scheme that would restore the right to pay “home fees” of £9,535 a year for EU students at UK universities. The UK government is firmly resisting this, not least because it would put financial pressure on cash-strapped universities. The sector is reliant on overseas students who typically pay two or three times domestic rates. Official data shows a more than 50 per cent drop in new EU students after Brexit, while universities increased recruitment from other markets in Asia and Africa, including India, Nigeria and Pakistan. Boris Johnson promised in 2020 that his Brexit deal would not interrupt the “va-et-vient” of people-to-people contacts with the EU, but in practice the intake of UK universities has shifted substantially. Jamie Arrowsmith, director of Universities UK International, which represents the industry, said the changes had brought greater diversity to British campuses, but had narrowed the field of subjects studied as international students tended to favour science and business studies courses. “While the diversity in terms of country of origin has changed, diversity in courses has been lost,” he added.

Health

Brexit also saw the introduction of a points-based immigration system by Johnson’s government from January 1 2021 that coincided with a massive expansion of the NHS workforce, necessitating far more overseas recruitment. Mark Dayan, policy analyst at the Nuffield Trust think-tank, said that a government decision to lower thresholds for medical workers had led to a radical reshaping of the NHS workforce. Between 2016 and 2023 the number of ethnic minority doctors in the NHS grew at almost 8 times the rate of white doctors, according to the General Medical Council, with arrivals from India, Pakistan, Egypt, Nigeria and the Philippines rising sharply. Dayan said the challenge of integrating doctors who trained overseas into the NHS was one reason why an increase in staff numbers in recent years had not delivered a commensurate increase in productivity. “Absorbing so many new staff, many at [the] start of their careers, who are used to a different system of working, requires a lot of work on training, and introducing them to how things are done in the NHS,” Dayan said. The government is planning to train more UK doctors as well as continuing to recruit from abroad, but its red lines on free movement of workers mean that it is unlikely that EU-UK reset negotiations will see a significant increase in recruitment from the EU.

Politics

Brexit was sold during the 2016 referendum campaign as the means by which the UK would “take back control” of its borders, curbing both legal and illegal migration. In the event, both surged after 2020, fuelling accusations of betrayal on the political right and helping to drive support for Nigel Farage’s Reform UK party, which has recently drawn level with both Labour and the Conservatives in the polls. This political splintering is the opposite of what former Tory premier David Cameron intended when he called the referendum to head off the threat posed by Farage’s UK Independence Party and resolve long-standing divisions over Europe inside the Conservative party. But Reform’s rise has come despite a decline in the overall popularity of Brexit, with 58 per cent of voters now saying Brexit was the wrong decision, according to polling by the National Centre for Social Research. A “key element” of this shift, according to pollster Sir John Curtice, is driven by demographic trends as older, pro-Brexit voters die off and younger voters, who were unable to vote in 2016, express their overwhelming pro-EU views. “If you look at the demographics story, the ceiling for a Farage party should be lower than 10 years ago, but Reform is more popular in 2024 than Ukip was in 2014,” said Rob Ford, professor of politics at Manchester University. Ford credited this counter-intuitive outcome to the platform Brexit gave Farage, and to the political opportunity offered to him by the Tories’ struggle to deliver benefits from the UK’s break with the EU.

Trade

The past few years have laid bare Brexit’s damaging impact on business. Countries usually strike trade deals to reduce border bureaucracy, but the EU-UK Trade and Cooperation Agreement did the reverse, restoring the customs requirements that had disappeared with the advent of the EU single market. Labour has said it will not rejoin a customs union with the EU or go back into the EU single market, so trade will continue to face customs barriers. Starmer’s negotiations with the EU could reduce friction for some individual sectors, such as food and drink exporters, if Labour makes good on its promise to strike a veterinary agreement with Brussels. Aligning industrial standards and relinking the EU and UK carbon trading schemes could also reduce other forms of red tape, such as licensing requirements and carbon border adjustment taxes, or CBAMs. However a mountain of paperwork will remain. In 2023, the last year for which data is available, there were more than 41mn customs declarations for trade between the UK and the EU. The much criticised Brussels red tape became ‘red white and blue’ tape. As a result, UK goods exports underperformed other rich-world countries, with the total value rising by just 0.3 per cent per year, compared with 4.2 per cent annually across the OECD, according to the UK in a Changing Europe think-tank.

Business

New Brexit red tape has hit small businesses hardest, with research by the London School of Economics calculating that 16,400 firms stopped exporting to the EU after the TCA came into force. William Bain, head of trade policy at the British Chambers of Commerce said smaller companies had less capacity to deal with “the deluge” of new bureaucracy, while larger businesses had the money and staff to adapt.
“Exporting to the EU was often a gateway for SMEs to enter new export markets across the world, so the urgency of making border processes cheaper and simpler is clear,” he added. The BCC has urged the government to use the reset negotiations to simplify border processes and promote regulatory co-operation on customs matters, particularly as the bloc introduces new rules in the coming years. Chris Southworth, secretary-general of the International Chamber of Commerce, said that given the UK’s red lines the government should invest in digitising trade, using AI and improving access to trade finance in order to help business. “You don’t need TCA for any of this and it will improve EU co-operation and repair some of the damage,” he added.

UK ministers, including chancellor Rachel Reeves who will travel to Brussels on Monday, have said they are seeking a “very ambitious” reset of the UK’s security and trading arrangements with the EU when talks begin next year. However a 19-page working paper setting out EU interests observed there were “limited” economic gains on offer as a result of the UK’s own red lines ruling out rejoining the EU’s single market or customs union, or accepting free movement of people. “A significant further reduction of trade frictions with a close trading partner, such as the United Kingdom, would be in the interest of the European Union. This, however, would require a different model for co-operation,” it said.

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Reuters interviewed 20 people under the age of 30 to understand their support. The most common reason given for backing the former president was inflation and the perception the economy was not working for them, underscoring how the rise in prices for daily staples is more salient for some than high stock prices and low unemployment during the Biden years. […] At the same time, a majority said they agreed with Trump's reticence about aiding Ukraine in its war with Russia, an isolationist stance at odds with Biden's foreign policy agenda.

The UK government has told the country’s port authorities that it will not “turn on” critical health and safety checks for EU imports when post-Brexit border controls begin this month because of the risk of “significant disruption”.

In a presentation seen by the Financial Times, the Department for Environment, Food and Rural Affairs (Defra) outlined a plan to avoid queues of lorries at ports, revealing that if the new border measures were implemented as planned big delays could follow. 

Since announcing new border controls on plant and food products last year the government has promised it would “phase in” checks, which trade groups have warned will hurt small businesses and drive up the price of food. 

However, just over a fortnight before physical inspections are set to begin, the presentation last week made clear that the new border systems will not be fully ready.

In order to get around the problem, the government said it would ensure the rate of checks was initially “set to zero for all commodity groups” — essentially switching off large parts of the risk management system, in what it called a “phased implementation approach”. 

Implementation of the new border controls has been postponed five times since 2021, which has left EU exporters of animal and plant products free to send them to the UK without checks.  

In its presentation, Defra admitted to port health authorities that “challenges” still remained within its systems for registering imports of food and animal products that could inadvertently trigger unmanageable levels of inspections, overwhelming ports.

“There is a potential for significant disruption on day one if all commodity codes are turned on at once,” it said.

The presentation did not make clear for how long border checks would be suspended but indicated that the systems would be “progressively turned on” for different product groups.

Business organisations have repeatedly called for the introduction of the new border to be delayed until at least October.      “Any further confusion and uncertainty around the introduction of new border checks and costs is bad news for business,” said William Bain, head of trade policy at the British Chambers of Commerce. 

“Business urgently needs to see crystal clear communication from Defra on its plans, and if any changes are being made then they need to know now.”

Defra made clear that its plan should not be shared with businesses, which will be charged a maximum of £145 “per consignment” for goods coming from the EU from April 30.

A Defra official also cautioned against disclosing it to the media, saying one of its main aims was to avoid negative news stories, according to a person familiar with the meeting. 

Defra said the main customs system will continue to run, but only for the highest risk products, such as meat products from certain countries, and depending on how busy the port of entry is.

Bristol, for example, had only 17 risk notifications in a three-week period this year, while Dover had 12,573 over the same timeframe, so the former could have the full customs checks activated, while those in Dover would be “limited” to avoid delays.

“It is beyond frustrating that repeated warnings about the readiness of crucial infrastructure have been ignored and now in less than two weeks businesses will have to try to navigate this clearly broken system,” said Phil Pluck, head of the Cold Chain Federation, a lobby group for the perishable goods trade.

“The government must postpone full implementation until October and start working with the food logistics industry for a system that genuinely works and mitigates even more confusion, disruption, and costs,” he added.

Defra said it was confident it had the capacity to handle expected checks. “As we have always said, the goods posing the highest biosecurity risk are being prioritised as we build up to full check rates and high levels of compliance.”

It added: “Taking a pragmatic approach to introducing our new border checks minimises disruption, protects our biosecurity and benefits everyone — especially traders.”

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Why hasn’t Threads launched in the EU? Earlier this week, Ireland’s Data Protection Commission (DPC), the chief regulator in the EU which governs Meta, said the company had confirmed that it did not plan to launch its Threads app within the EU this week. A spokesperson for the regulator said that it had been in contact with Meta about the new service and that it would not be rolled out in the EU “at this point”, according to the Irish Independent. Under the EU’s Digital Markets Act, which came into force earlier this year, tech giants are heavily limited on the data they can share between services they own. This has repercussions for Threads, which brings a user’s data over from Instagram to create their profile. The Irish Independent claims that Meta is seeking clarification from the DPC on how these rules will apply to Threads before they proceed with a launch in the EU market. The DPC has previously blocked the launch of other Meta features in the past, including its Facebook Dating service and Messenger Kids app. In May, the regulator fined Meta a record €1.2 billion (£1 billion) after it ruled the company had breached EU regulations by transferring European users’ Facebook data to the US. Meta will be forced to stop transferring Facebook users’ data to America within five months, and has been given six months to remove data from US servers.

How is Meta regulated in the UK? The regulation of Meta and other tech platforms in the UK are overseen by the Information Commissioner’s Office (ICO), which confirmed earlier this week that the launch of Threads would go ahead. “We have received confirmation from Meta that Threads will launch in the UK on July 6 and are continuing to engage with the company on its approach to data protection compliance,” a spokesperson for the ICO said. The UK is not subject to the EU’s Digital Markets Act and does not have equivalent provisions on the statute books as the law passed after the UK’s departure from the EU in 2020. New laws on data and privacy are in the works in the UK via the Data Protection and Digital Information Bill. The government claims the legislation “sets out the UK’s common-sense led data laws and will give organisations greater flexibility to protect personal data, while maintaining high data protection standards.”

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