United Kingdom


Key Challenges

Brexit outcome remains primary challenge
Dealing with the consequences of the Brexit referendum – internally and externally, as well as politically and economically – remains the main challenge for the United Kingdom until the process is complete. More than 18 months into the process, it can safely be stated that in many areas the challenges are not being handled optimally. Unsurprisingly, given the complexity of the tasks the British government has taken on, delays, disagreements and wishful thinking largely characterize the situation. Finding good solutions for as many of these challenges as possible will require political will and skill, hitherto lacking. The main domestic political challenge is to find and sustain a stable political majority for completing Brexit, despite both major parties being split over the course to be taken and seeming unable to find compromises that bridge their antagonisms.
Securing future EU
relationship a key
Internationally, maintaining good relations with the European Union is vital both for successfully concluding the Brexit negotiations and securing a mutually satisfactory future relationship. However, the tactical behavior of some UK politicians over Brexit so far has threatened the credibility of the United Kingdom as a negotiation partner. In parallel, the United Kingdom faces the challenge of recasting its economic, political and security relationships with other parts of the world. Unrealistic expectations of a rapid conclusion to trade deals will have to be tempered, while renewing relationships with old partners (for example, Commonwealth countries) and enhancing them with others will need attention.
Risks to growth must
be minimized
An economic challenge will be to achieve a post-Brexit outcome that minimizes the risks to economic growth while making it politically possible to claim to have achieved increased sovereignty. However, the economic policy agenda facing the United Kingdom transcends Brexit. A weak record on productivity and a persistent external deficit are known problems, but greater urgency is needed in resolving them.
Public finances remain fragile
Consolidation of the public finances has been slow and the longer-term consequences of unwinding the substantial program of quantitative easing undertaken by the Bank of England will have to be taken into account. Constitutionally, there are immediate challenges in settling the continuing difficulties in Northern Ireland, but there is also unfinished business around the devolution of powers from central government to Scotland, Wales and the growing number of mayor-led authorities in England. This is especially important to avoid the sort of constitutional crisis that could arise if the respective political authorities disagree with the terms of Brexit, possibly leading them to try to block an agreement with the European Union. Difficult though Brexit undoubtedly is, the United Kingdom cannot neglect other important societal challenges.
Health care is increasingly pressing issue
Because of the inexorable effects of an aging population, much more will have to be done to improve health care and to integrate it better with social care, against a backdrop of constrained public funding and staff shortages. Similarly, and even if Brexit does ultimately stem the inflow of economic migrants, the need for an increase in housing is striking, the funding model for higher education has to be revisited, and over-stretched infrastructure calls for substantial new investment. Concerns have surfaced about the readiness of the armed forces to undertake missions and, as so often, terrorist threats remain high.
Non-Brexit issues must be given more attention
Dealing with these and other domestic priorities will be demanding at a time when Brexit is consuming so much political attention and capital. While much has changed in recent years, arguably for the better, in the conduct of public administration, not least in making government more open, the extent of change in the pipeline will be testing for the government. The challenge for the executive will be to reconcile the heavy demands of Brexit with the need to maintain momentum in other policy domains.
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