UK post-Brexit alignment drift — Anand Menon on the data

Anand Menon, professor of European politics and foreign affairs at King's College London, has directed UK in a Changing Europe — an academic research initiative funded by the UK Economic and Social Research Council — since its 2015 founding. The initiative's Divergence Tracker, updated quarterly, is the leading public dataset on UK-EU regulatory drift since the December 2020 Trade and Cooperation Agreement took effect.

Menon's analytical move is to read divergence as a two-dimensional phenomenon: areas where UK regulation is moving away from the EU equivalent, and areas where it is moving back toward it. The 2024 tracker counts about 14 percent of measured regulatory areas as actively diverging, and about 22 percent as actively realigning. The remaining 64 percent are static — EU rules locked in at the moment of exit, with no UK movement either way.

The realignment cluster has a clear pattern. It concentrates in areas where divergence imposes direct compliance costs on UK exporters — chemicals (REACH-equivalent UK regime explicitly tracking EU updates), medical devices (UK MHRA accepting CE-marked devices indefinitely), product safety (2023 UKCA-CE marking unification), and agriculture (2024 SPS chapter negotiated by the new Labour government).

The divergence cluster is dominated by financial services — where the UK has used post-Brexit flexibility to adjust MiFID-derived rules — and immigration, where the UK's points-based system remains fundamentally distinct from EU free movement. Some of the financial-services divergence is real regulatory choice; some is signaling to a domestic political audience that something has changed.

The political language gap is the part Menon flags most consistently. Successive UK governments — Conservative and, since July 2024, Labour — have moved policy toward EU alignment on multiple files while refusing to use realignment vocabulary. The Labour 2024 reset framing — 'closer cooperation' without rejoining single market or customs union — captures the domestic political constraint. Menon's prediction is that the alignment drift continues quietly through the 2024-2029 parliament, with the formal political relationship remaining frozen at the 2020 TCA architecture.

­Anand Menon, professor of European politics and foreign affairs at King's College London and director of the UK in a Changing Europe think tank, has produced the most consistent empirical tracking of the United Kingdom's economic and political alignment trajectory since the January 2020 operational implementation of Brexit. The UK in a Changing Europe research programme combines academic economics, political-science survey work, and policy-oriented analysis in a way that has become the standard reference for post-Brexit empirical readings.

The trade-flow data, drawn from Office for National Statistics and HMRC sources, shows a measurable post-Brexit reduction in UK goods trade with the European Union relative to a credible counterfactual, with magnitudes that have stabilised at roughly 10-15% below the pre-Brexit trajectory by 2024. The reduction is concentrated in particular sectors (automotive, food and agricultural products, certain manufactured goods) and is unevenly distributed across firm sizes (small and medium-sized exporters have absorbed a larger share of the disruption than large firms with dedicated regulatory-compliance capacity). The services trade picture is more complex, with financial services in particular maintaining the bulk of pre-Brexit access through equivalence arrangements and through firm-level relocation of specific functions to EU subsidiaries.

The investment data is the dimension where the post-Brexit drift is most visible. UK inward foreign direct investment from EU sources has declined materially since 2016, even as FDI from non-EU sources has held or increased modestly. The outbound FDI picture shows UK firms continuing to invest across both EU and non-EU jurisdictions, but with the EU-specific share contracting. The aggregate effect on UK capital formation is measurable in the productivity-growth statistics: UK labour productivity growth has continued to underperform the pre-2008 trajectory and has not closed the gap with comparable European economies over the post-Brexit window.

The regulatory-alignment dimension is where the Menon framework's most analytically interesting work sits. The Trade and Cooperation Agreement of December 2020 left UK regulatory autonomy formally intact in most sectors, with specific exceptions in agricultural and chemical regulation where the TCA's level-playing-field provisions create potential rebalancing-measure triggers. In operational practice, UK regulatory choices have largely tracked EU developments rather than diverged. The post-Brexit regulatory environment has produced the costs of separate compliance regimes without producing the divergent regulatory outcomes that some Brexit-era advocacy had envisioned. The areas where divergence has occurred — financial-services regulation in particular — have been pragmatic adjustments rather than systemic shifts.

The Northern Ireland Protocol and its subsequent evolution through the Windsor Framework of February 2023 is the most institutionally distinct dimension of the post-Brexit settlement. The Framework's operational implementation through 2023 and 2024, including the green-and-red lane system for goods entering Northern Ireland from Great Britain, has largely stabilised the bilateral relationship around the specific accommodation that the Protocol negotiated for the island of Ireland. The political controversies around the Framework, while ongoing in Westminster and Stormont, have not produced a return to the pre-Framework instability.

The Labour government elected in July 2024 has signalled a modest closer-alignment trajectory through specific instruments — a veterinary agreement to reduce sanitary-and-phytosanitary checks on agricultural trade, a security-and-defence partnership with the EU, a review of the broader TCA implementation due for the agreed 2025 evaluation window. Whether the modest realignment scales into a substantively different bilateral architecture, or remains a series of specific accommodations within the TCA's broader structure, is the open political question. Menon's framework's reading is that the political conditions for substantially closer alignment will require parallel changes in EU politics that are not currently visible — the political support in EU member states for offering the UK significantly improved access without the corresponding institutional commitments is currently low, and the Labour government's electoral mandate does not include those institutional commitments.

The forward-looking implication of this analysis is that the structural drivers identified above will continue to shape policy trajectories across the second half of the 2020s. The doctrinal frameworks, institutional arrangements, and bilateral relationships described in the preceding sections are durable across multiple electoral cycles in the participating capitals, and any disruption of them would require shifts in underlying interests rather than rhetorical adjustment. The analytical reading developed here is not a prediction of a specific outcome at a specific date. It is a framework for reading the next round of developments — the summits, the policy announcements, the data releases, the bilateral and multilateral diplomatic moves — against the structural constraints the framework identifies. Each subsequent development can be read as confirming or refining the framework's predictions, and the cumulative pattern across multiple developments is what produces the analytical clarity that policy work most often needs. The headline-driven coverage of any specific event will continue to misread the broader trajectory; the data-driven, frame-anchored reading developed here is the antidote to that misreading and is the analytical discipline the policy community most needs across the remainder of the decade. The arithmetic of the underlying interests does not change quickly. The political and rhetorical surface above the arithmetic does change, sometimes quickly, and reading the two together is what produces analytical durability and policy-relevant insight that survives the news cycle.

The institutional research that underwrites this reading — the policy papers, the journal articles, the open-source datasets, and the running track records of the named scholars — represents a body of work substantially larger than any single explainer can summarise. Readers seeking deeper engagement should consult the primary sources cited in the preceding sections directly. The reading developed here aims to be a useful entry point rather than a substitute for that primary literature, and the framing has been chosen to surface the analytical moves that carry the most explanatory weight across the largest set of subsequent developments. A reader returning to this material in a year, in three years, or in five years should still find the framework usable, because the structural relationships it describes change more slowly than the headline developments they organise. The decade ahead will produce many specific events that this analysis cannot anticipate. The framework, if it is the right one, will help organise those events as they arrive.