Brexit: social and equality impacts

Executive Summary

Why do this analysis

This report focuses on the potential social and equality impacts of Brexit.

A social and equality assessment is valuable because Brexit will bring major, long-term, systemic changes to Scotland. Brexit also continues to bring confusion and uncertainty about the future of the UK, and how leaving the EU might affect the lives of the UK's inhabitants. It is highly likely that vulnerable groups will be affected, and that unintended and unforeseen consequences will ensue.

However, the UK government has not produced a full equalities impact assessment of Brexit, which includes the potential legal and socioeconomic effects on different groups of people in the UK. An 'Equality Analysis' of the previous European Union (Withdrawal) Act 2018 (under Theresa May) was narrowly focused on the legislative equality impacts, and did not differentiate impacts on a group-by-group basis. More recently, the EU (Withdrawal Agreement) Bill – which was initially introduced by the UK Government in October 2019 and revised and reintroduced following the general election in December 2019 – was not accompanied by a separate Equality Impact Assessment or 'Equality Analysis', although the accompanying Impact Assessment (IA) for the October version did contain two paragraphs on 'equalities'.

Overall this leaves a significant gap in our understanding of the potential social and equalities implications of Brexit.

What this report covers

This report asks: what effect might the UK's decision to leave the EU have on the legal rights and protections of individuals and groups in Scotland? In the case that Brexit has a negative impact on the UK economy, what might this mean for people's jobs, spending and access to public services? This report examines these questions from the perspective of twenty equalities groups in Scotland who may face discrimination or exclusion as a result of their personal characteristics. These groups include disabled people, people from minority ethnic communities, migrants, care-experienced people, elderly people, faith and religious communities, children and young people, homeless people and women.

In total, the report identifies 137 potential social impacts across equalities groups, including the loss of legal rights, employment protections, funding opportunities, healthcare rights, and impacts on food, fuel and medicines. While some of these impacts reflect similar trends (e.g. the loss of certain rights/ services), they are distinct in terms of how they happen, who they affect, or both.

The report begins by considering what we mean by 'equalities groups'. It identifies groups of people who fall into the categories of 'protected characteristics' specified under the Equality Act (2010), and those with other personal characteristics who may face social exclusion or discrimination.

The analysis then suggests that Brexit is likely to have both general socioeconomic and legal impacts, as well as specific impacts, for equalities groups. Moreover, these impacts will differ depending on the type of Brexit that occurs.

General impacts of Brexit since June 2016

The report identifies some of the general consequences for equalities groups of the Brexit negotiations to date, resulting from social and economic impacts of the EU referendum and subsequent discussions surrounding how the UK will leave the EU. Effects of Brexit to date include impacts on community relations, the labour market, representational impacts, legislative impacts, immigration uncertainty and mental health and wellbeing impacts.

Impacts of a hard Brexit

The report then looks to the future, by anticipating the general impacts of different types of Brexit going forward. The first scenario - a 'hard' managed Brexit – will result if both:

(i) the UK Government's European Union (Withdrawal Agreement) Bill (or 'EUWAB' for short) is passed by the UK Parliament and enacted in order to implement, and permit the subsequent ratification by the UK of, the revised Withdrawal Agreement (followed by the ratification of the Withdrawal Agreement by the European Parliament) and;

(ii) the UK Government proceeds to negotiate a future economic and security partnership with the EU on the basis of the revised Political Declaration, which contains some commitments to ensuring a 'level playing field' between the UK and the EU (i.e. common rules and standards, for instance in competition and state aid, tax and social and environmental protection) whereby the "precise nature of commitments should be commensurate with the scope and depth of the future relationship and the economic connectedness of the Parties." ^[1]

Potential impacts include: loss of rights, economic and public services impacts, increase in hate crime, immigration and labour market impacts, and the potential for further dilution of equalities rights and protections.

Impacts of a softer Brexit

A second scenario – a 'softer' managed Brexit – may occur if the UK Government's proposed future relationship and trade deal with the EU – the key points of which are outlined in the non-binding Political Declaration that accompanies the Withdrawal Agreement– is softened during the course of UK-EU negotiations. This may involve, for instance, efforts to ensure greater regulatory and legal alignment with the EU by committing to more comprehensive level playing-field provisions and closer alignment with the single market and customs union. Nevertheless, potential impacts of a softer Brexit include: loss of some rights, economic and public services impacts, increase in hate crime, immigration and labour market impacts, and the potential for further dilution of equalities rights and protections.

Impacts of a no-trade deal Brexit

An unmanaged or 'no-deal' Brexit, where the UK does not withdraw from the EU under the terms of the Withdrawal Agreement is now unlikely to occur at the end of January 2020 (as the EUWAB has completed its passage through the Commons and the Lords' scrutiny is expected to be concluded during the week commencing 20 January, allowing sufficient time for the Withdrawal Agreement to be ratified by both the UK and EU in advance of the 31 January deadline for the UK to leave the EU at date).

However, a third scenario – a no-trade deal Brexit – may still occur at the end of December 2020, if a UK-EU trading relationship is not agreed by then and there is no agreement by June 2020 to extend the transition period beyond 2020. If the transition period ends without the UK having agreed a deal with the EU on the future relationship, this outcome is likely to share many of the characteristics of the unmanaged 'no deal' Brexit which seemed a distinct possibility for much of 2019. This could, for example, include transport disruptions leading to shortages in medicines, rising food and energy prices, impacts on safeguarding and protection, loss of rights, social care impacts and community tensions.

Specific impacts on 20 equality and social groups

The next section of the report focuses on specific impacts of different types of Brexit. It identifies 20 equalities groups that may be affected by Brexit, looking at three areas of potential impact through changes to:

(1) their legal rights;

(2) public services and funding;

(3) their employment, housing and (consumer) spending prospects.

The infographics below summarises the potential impacts of Brexit on individuals.

The 20 groups analysed include: women, children and young people, older people, minority ethnic communities, EU nationals, refugees and asylum seekers, people on low-incomes, disabled people, pregnant women and mothers, faith and religious communities, LGBTQIA+ communities, Gypsy/Traveller communities, care-experienced people, people with caring responsibilities, people in remote and rural areas, precarious workers, offenders and ex-offenders, homeless people, people with substance abuse issues, and men.

A closer look at three case studies

The report also focuses on three case studies – women, disabled people, and minority ethnic people – to explore in depth the potential impacts of Brexit (across their legal rights, access to public services and funding, and employment, housing and consumer spending) for these equalities groups. These case studies also consider the potential for people's resilience to these impacts, and whether each of these impacts is more or less likely under three possible Brexit scenarios – hard, softer and no-trade deal Brexit.

Emerging findings

The report finds that impacts will differ depending on the type of Brexit pursued:

• a 'no-trade deal' Brexit is likely to have the largest number of adverse impacts across people's legal rights and welfare standards;
• a 'hard' Brexit (reflected in the Withdrawal Agreement and the future UK-EU relationship proposals contained in the revised Political Declaration) will have similar effects to a no-trade deal Brexit in that it is likely to result in the loss of significant legal rights;
• a 'softer' Brexit – whereby the future UK-EU trade deal is softened (compared to the Political Declaration) to include more comprehensive level playing-field commitments – could protect some rights (i.e. employment) but will still result in the loss of others (i.e. European citizenship).

The report finds that the potential socio-economic effects of any type of Brexit, in the case that the economy performs poorly and there are cuts to public services, will likely to be widespread across equalities groups, many of which tend to possess fewer economic resources, are more likely to be on low-incomes, have precarious employment, and are more reliant on public services.

Many equalities groups are also likely to feel the shared impact of any loss of EU rights and protections which are not transposed into UK domestic law (such as the freestanding right to non-discrimination which is part of the EU Charter of Fundamental Rights). People will also be affected by the discontinuation of EU social rights, such as the European Health Insurance Card (EHIC), the EU Blue Badge for disabled parking, and equal rights to social security.

Equalities groups across the board are also likely to be adversely affected by the UK's exit from the European Structural and Investment Funds (ESIF), which have to date provided extensive funding to equalities organisations across Scotland/the UK to support the rights and welfare of equalities groups, especially if these funds are not sufficiently replaced by the UK Government's proposed post-Brexit Shared Prosperity Fund.

Furthermore, specific equalities groups will likely be affected by the potential amendment or repeal of specific pieces of EU secondary legislation or CJEU rulings that are not part of primary legislation in the UK, which are most at risk under a hard Brexit and a no-trade deal Brexit. These include directives on pregnant workers and agency workers (which a former UK Brexit Minister has advocated repealing), air passenger rights, and the right of unaccompanied children seeking asylum to unite with family members. Equalities groups are also likely to lose out on future EU equalities legislation (such as the EU Work-Life Balance Directive and the European Accessibility Act) if the UK, at the end of the transition period, decides not to continue to align with these directives.

Likewise, equalities groups may miss out on any additional equalities protections provided by future rulings of the Court of Justice of the European Union (CJEU), raising concerns that some equalities rights enjoyed by different groups in the UK as a result of EU law will be 'frozen in time'.

Finally, the report finds that the potentially adverse socio-economic and legal impacts of the UK's decision to leave the EU will be most deeply felt by people experiencing multiple disadvantage, who are likely to have less resilience to cope with multiple adverse impacts. The report therefore suggests that future research should adopt an intersectional perspective on equalities impacts, as those people who have more than one protected characteristic (for example, minority ethnic women, young care-experienced LGBTQIA+ people, EU nationals on precarious work contracts, or disabled single mothers) are likely to be most affected by Brexit, and are less likely to be resilient to potential impacts.

General Election 2019

Most of this report was researched and written prior to the general election on 12 December 2019, which returned the incumbent Conservative government with an overall majority (365 out of 650 seats in the House of Commons). However, the analysis contained in this report regarding the social and equality impacts of Brexit is just as relevant as it was prior to the election, indeed, more so.

With the imminent passage of the European Union (Withdrawal Agreement) Bill, the UK is now set to leave the EU on 31 January 2020. This means that the options on Brexit have significantly narrowed, with the likelihood of a second referendum on Brexit or revoking Brexit (two possible Brexit scenarios) in effect ruled out.

Given the Conservative government's overall majority, and its greater ability to pass legislation, the Prime Minister's stated preference for a "hard" Brexit and leaving with some form of UK-EU trade deal before the end of the transition period seems the most likely.

This may change if the Conservative government softens its position on the UK-EU future relationship in the course of negotiations in 2020 and agrees to level playing-field commitments and alignment with EU law (leading to a softer Brexit), or if the UK fails to negotiate a trade agreement with the EU by December 2020 (leading to a no-trade deal Brexit, whereby the UK reverts to WTO terms in its EU relations)..