Mandelson: Hard Brexit Bad for All

By Hans-Peter Siebenhaar
Published 20 February 2017 in Handelsblatt

Former E.U. commissioner Peter Mandelson talks to Handelsblatt about why a hard Brexit is not what the British public want.

Peter Mandelson, the Labour politician who helped the former British prime minister, Tony Blair, attain and hold on to power, believes that most Britons want the United Kingdom to maintain close relations with the European Union.

In an interview with Handelsblatt, he said the government was wrong to interpret the results of Britain’s referendum on E.U. membership as a sign that people wanted a “hard Brexit,” that severed all ties with the European Union.

He argued that even those who voted for Brexit “didn’t vote to make the country poorer or our economy smaller or to sacrifice so much of our trade which would be the result of a hard Brexit.”

“I think when asked the Brit people would say, no we want a continuing relationship, we want to secure the continuity of our trade, we want close collaborative relations with other countries in our own neighborhood.”

Mr. Mandelson is currently a member of the House of Lords, the British upper chamber of parliament, which on Monday starts to debate Britain’s withdrawal from the European Union.

The lower chamber, the House of Commons, has already approved a total withdrawal and Prime Minister Theresa May wants to start formal talks on Brexit by the end of March.

Mr. Mandelson said public opinion was that there is no need for Britain to withdraw from the single market or customs union, but the government is determined to follow a more hardline stance of a so-called hard Brexit.

“They believe they have a mandate, not only to take Britain out of the European Union but out of the single market and the customs union as well, and there has been no further real debate about that,” he told Handelsblatt.

Former Prime Minister Mr. Blair said in a speech last week that he believed people had voted for Brexit without understanding the full implications of the move.

Mr. Mandelson, who was Mr. Blair’s media manager, trade minister, and later a European Union commissioner for trade, said the nationalists in the ruling Conservative party, and some newspapers, were the ones pushing for a hard Brexit.

“Public opinion has no influence anymore,” Mr. Mandelson said. “Now that the referendum has taken place it has effectively neutralized the role of parliament to reflect the nuance and the balance of public opinion, and the government are determined not to test the view of the public again.”

He said he would prefer that the government find a way to maintain economic and trade relations between Britain and the European Union, warning that both sides would suffer from a total break.

While Europe would suffer economically from a hard Brexit, Mr. Mandelson predicted that Britain would be even more disadvantaged.

“I hope very much that when this negotiation gets underway that all sides will step back from mutual assured destruction, which could be the result if the divorce is very acrimonious. But that destruction, if it were to occur, would, in my view, be worse for Britain.”

When it comes to the role of the City of London, the former Commissioner predicted that there would be no immediate collapse of the city as a European financial hub. “London will continue to have very deep capital markets but many financial activities of institutions in London will move elsewhere in Europe and in some cases, out of Europe altogether,” leading eventually to a shrinking of its role.

He went on to say it was “naïve” to believe that Britain would be able to replace its current trade links with Europe with the “hypothetical gains” of a future closer relationship with the United States.

Any move toward the United States, particularly in terms of a realignment of product standards and regulatory frameworks, will make it all the harder to trade with Europe, he argued. “In shifting our eggs from the European to the American basket, we would be taking a leap into the unknown and for me that is too big a risk to take.”

Hans-Peter Siebenhaar is Handelsblatt’s correspondent in Vienna and specializes in media and telecommunications coverage. To contact the author: