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Binning the Brexit backstop: the impact on the NHS

Thursday August 29th, 2019

With Brexit still dominating the news headlines, one thing constantly mentioned is the Northern Irish backstop, with the new Prime Minister adamant it must be removed from any Brexit deal. But what would this mean for the NHS, if it were to happen? Mark Dayan gives his expert view.nhslogo

Boris Johnson has been clear before and since his rise to Number 10 that the only alternative to a no deal Brexit he will contemplate would be a deal without the Northern Irish protocol included in the Brexit Withdrawal Agreement negotiated by his predecessor. This “backstop” aims to stop a hard border with the Republic of Ireland whatever happens by requiring Northern Ireland, and to some extent the whole UK, to keep following certain EU rules.

Any Brexit deal would be better than no deal for health and social care: any deal would flatten off the regulatory cliff edge on medicines and devices that creates an acute risk of shortages, and create certainty for UK emigrants receiving care abroad and for EU immigrants providing care in this country.

But an agreement without the backstop as it was agreed last year would be noticeably different – and in many ways, though not necessarily all, would be noticeably worse for the health service.

Back to the border?
The most obvious impact would be on services in Northern Ireland and the Irish Republic if there is a return to an enforced border. These could obstruct a range of health and social care activities that cross the border.

We know at least around 30,000 people commute between the countries daily. Given that roles in health, social care and social work account for around 15% of jobs in Northern Ireland, it seems plausible that this includes several thousand staff in the NHS and care sector. While nothing will legally block them due to the Common Travel Area between the UK and Ireland, the possibility of delays and obstructions as a customs border forms is clear.

Services and patients cross the border too, including ambulance services to help urgently ill patients. Ambulances need to contain many regulated and controlled substances that will require extensive regulatory processes to get across the border, and while the UK will continue to recognise the qualifications of EU workers, it is not clear the reverse will be true.

However, partly because of problems like this, it seems unlikely that the EU will agree to something that actually reintroduced a hard border. This would mean that the only plausible way of ‘scrapping’ the backstop while still having a Brexit deal would be to keep much or all of what guarantees an open border on the island of Ireland, while changing aspects that affect the wider UK.

Terms of trade
For the rest of the UK, the most important possible change would be removing the customs union that the backstop protocol contains. This basic trading agreement would apply to England, Scotland and Wales as well as Northern Ireland. It would remove tariffs and quotas from trade between the UK and the European Economic Area, and eliminate the need for some types of checks. It was assumed by many experts to be not just something that would happen if the backstop was actively triggered, but a more general baseline for future negotiations.

Losing this would have two potential consequences for the NHS. First, while nearly all types of Brexit would drive up the service’s costs to some extent, a customs union might be expected to do so somewhat less than a harder form of Brexit.

The UK in a Changing Europe estimate non-tariff barriers to trade would rise 3% under the original Brexit deal, assuming a customs union. This is significantly less that the 8% government analysis suggested for a general free trade agreement.

Because these analyses use different methodologies, there is little point in making more than a ballpark comparison. But based on extrapolations that the NHS spends around £2.9 billion of its medical devices expenditure and three-quarters of its roughly £20 billion medicines expenditure on EU imports, the difference certainly implies extra costs of several hundred million pounds each year.

Level playing field
The backstop also contains provisions that apply to the whole of the UK to create a ‘level playing field’, where we would continue to abide by current or future EU standards.

These include a provision that the UK as a whole will not fall below the current standard of labour regulation. Notably for the NHS, this would include the Working Time Directive, which limits the hours staff can be asked to work. Some bodies representing hospital doctors have long complained about the limitations of these rules and might be glad to see the UK no longer bound by them. However, the British Medical Association and several other Royal Colleges disagree and see them as an important safeguard.

The direction of travel
It is also important not to lose sight of the bigger picture. One main advantage of a deal over no deal for health and social care is that it creates a framework for a future agreement with the EU. This could eliminate some, although certainly not all, of the ruptures in regulation that might be associated with Brexit. For example, EU trade deals with countries like Australia have enabled mutual recognition of standards in medical devices, enabling cheaper and easier trade.

The last government generally favoured this kind of alignment within the constraint of ending the free movement of labour – to the point of asking for mutual recognition of medicines authorisation, something the EU was never likely to agree to. If binning the backstop means setting a course for a generally looser arrangement in future, we will face some of the problems of leaving without a deal even if the process does end with a pair of signatures on the dotted line.

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