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Tony Travers: time to seek local evidence in advance of trade deals

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Local government has no direct role in the Brexit negotiations. The process of doing transition and exit deals with the EU27 is concentrated in a very few hands, at the core of Whitehall and in No 10. 

Even the Scottish and Welsh governments have little impact on decision-making. David Davis and Michel Barnier have not, we must assume, spent time discussing what councils in the UK might think about the transitional deal struck this week.

Which is not to say that Brexit is irrelevant for local authorities. Already, EU migration has fallen, inevitably exposing some councils to the risk of labour shortages and higher labour costs. A number of local government leaders have been lobbying for locally-specific immigration rules, particularly for seasonal agricultural labour and construction. Most authorities are keeping a watching brief on developments, particularly through the Local Government Association and other representative bodies.

The big challenge will come when the government starts to sign trade deals with the EU27, other blocs and countries. This week’s deal allows the UK to strike trade deals between the end of March 2019 and December 2020, when the transitional period ends. As and when ministers determine the UK’s trading relations with other countries, each deal will feed back impacts into local economies throughout the UK.

For example, trade arrangements and tariffs relating to car manufacturing and chemicals will be of profound importance to areas in the north-east where such industries are disproportionately important. Tariff and trade rules about aerospace will be significant to the West Midlands and parts of the south-west. A deal with New Zealand would affect sheep farmers. Thus, once Liam Fox and other ministers start to sign trade deals, they will be triggering change to the economy of council areas in all parts of the country.

Council leaderships will need to be ready with evidence about the potential impacts of trade deals on their areas. If sectors are to be affected negatively by new trading and tariff rules, there will need to be transitional arrangements. All of this will take place against the backdrop of wider changes in global industrial development. All politics is local, including the consequences of the UK leaving the EU.

Tony Travers, director, LSE London

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