Sector News
Brexit Negotiations – The Danger of “Goodwill” Concessions

Keir Starmer, the UK Labour Party shadow Brexit Minister, has said that EU citizens will retain the right to stay in the UK post Brexit, and that he would concede that immediately in the negotiation with the EU representatives (if his party wins the forthcoming UK general election of course). This would build trust, he says, and help the negotiations along.

As the FT reported, “Sir Keir’s offer to respect the rights of EU nationals in Britain immediately was one of the few policy statements that gained applause from his audience. He called it “shameful” that Theresa May, the prime minister, was not committing her party to the same policy”.

So here is how we can see that negotiation going, as Starmer comes up against the European Negotiator (let’s call him or her “ErN” for short).  The concession approach carries certain risks, that’s for sure.

ErN         It is good to meet you, Sir Keir Starmer. We were very surprised your party won the election, but we welcome the chance to negotiate with you.

SKS         Thanks, Ern. Now just to build trust and get things off to a good start, we’d like to offer the right for all Europeans to stay in the UK, as a unilateral deal. We are happy to do that.

ErN         Thank you, we appreciate that. Perhaps you could just sign here … good. Very good. Now, what else do you have that could help us build trust?

SKS         Well, I was thinking that maybe you would reciprocate – perhaps allowing UK citizens to stay in the EU?

ErN         Oh no, I don’t think we have enough trust yet to do that yet. I think we have to build more, much more. So perhaps you can just agree the £60 billion payment for staff pensions and so on that you will owe the EU when you leave? That would be VERY good for building trust.

SKS         Well, I don’t think I can just give something like that up, you need to give me something.

ErN         OK, tell you what, we will let you stay in the Eurovision Song Contest. That is a big issue for you, yes? It is a major concession for us, Malta really did not want us to agree to that …

 

You see what we mean about the risks.

Now we accept that giving away unilateral concessions can be a useful tactic to build trust in a negotiation situation. As Professor Deepak Malhotra of the the Harvard Negotiation Project says in this articleSix Ways To Build Trust in Negotiation”:

A carefully crafted unilateral concession can work wonders for trust, for it conveys to the other party that you consider the relationship to be a friendly one, with the potential for mutual gain and trust over time.

But there are some major issues here too. Back to the Harvard thinking on this.

A true unilateral concession requires no commitment or concession from the other side. Such concessions must come at little cost or risk to the provider, but be of high benefit to the recipient. In addition to establishing trust, carefully crafted unilateral concessions also demonstrate your competence by portraying you as someone who understands what the other side values.

Our highlighting, which points out a key issue here. This concession is far from something with “little cost or risk” to the UK – it is obviously an important point for both sides. So, you could see that maybe an early win for both parties might be to agree similar reciprocal rights for the UK and EU citizens, but just to give that away risks losing a major bargaining chip for no return.

A concession like that could also be seen as reflecting a weak UK negotiating position. Or, knowing that Labour are very conflicted on Brexit, maybe the EU would think that if the UK deal looks really bad, Labour might hold another referendum. So, more motivation there for the EU to play hard-ball too.

All this is highly theoretical in the sense that the chances of Starmer leading those negotiations is vanishingly thin given the shambles of the Labour leadership. Whatever their policies, and some aren’t bad, the British public just looks at Labour leader Corbyn and says, “he simply can’t be Prime Minister”.

But back to negotiation strategies. We do understand why Starmer might consider this concession as an early approach, but we think the risks are too high. We suspect the EU response will simply be “thanks, what will you offer us next”? We have no idea what the Tory strategy might be – we just hope somebody is thinking long and hard about that as we speak.

Voices (3)

  1. Phoenix says:

    “Labour are very conflicted on Brexit”? Let’s remember that the EU Referendum was David Cameron’s reckless attempt to resolve long-running battles in the Tory party that got us into this unholy mess in the first place!

    There’s no doubt that there are risks in making early concessions in negotiations, that’s hardly rocket science. Let’s hope that those in charge of negotiating in this whole sorry mess remember that. But you are missing the point. What Sir Keir Starmer also said was that Labour wanted to negotiate from a set of values “of internationalism, of being outward-looking, of a belief that we achieve more together than we do alone… EU citizens are part of our society and not bargaining chips.”

    There are plenty – hundreds – of individual negotiating points to be settled, many of them of great value to either or both sides in this highly complex negotiation. There’s nothing that says you have to swap the rights of EU citizens for those of UK nationals over there – nor does it guarantee that such an offer would be accepted – or May and Juncker could have agreed that over dinner last week. What the Conservatives have been happy to do is allow hundreds of thousands of people to feel worry and stress over their futures completely unnecessarily. That might give the PM the tough reputation she likes as a “bloody difficult woman” but it doesn’t make her a great negotiator, not in my book anyway.

    I don’t see compassion for people as a sign of weakness. It’s a sign of strength.

  2. Dan says:

    You also need to take into account the time restrictions – according to Article 50, they are limited to two years. By making this concession early on, it gives the opportunity to move on to other issues quickly.

  3. Digby Barker says:

    As is usual in politics and economics everything is connected to everything else so we should proceed on the basis that nothing is agreed until everything is agreed while looking for ways of building a constructive atmosphere of which trust is but one component. Anyway, making uilateral concessions doesn’t build trust: but, as Dan implies, it is at least a way of prioritising.