Brexit: Theresa May says ‘trust me’ to deliver
PM appeals to the public for ‘help’ in bid to break Brexit deadlock
Brexit: EU trade guidelines reject Theresa May’s vision
The European Union warned Theresa May today that her approach to Brexit will lead to “negative economic consequences”, as it ruled out special access to the single market for certain parts of the UK economy.
Announcing the draft guidelines for future negotations, European Council President Donald Tusk said it should come as “no surprise” that the “only remaining possible model” is a trade deal similar to the one struck with Canada.
“The best that's on offer is a free trade agreement on goods with no tariffs, and access to the European markets for the UK service sector - but under EU rules and with no specific mention of financial services,” says the BBC ’s Adam Fleming.
Although Tusk’s “words are clear” on their own, “they do not do full justice to the message he conveyed”, says The Guardian’s Andrew Sparrow. His tone was “very striking; it was lugubrious, almost funereal”.
The guidelines appear to set the bloc on a collision course with the UK, says HuffPost's Owen Bennett. Although the EU has always been clear that the free movement of goods, capital, services and labour are indivisible, “ruling out a sector-by-sector approach will be worrying for the UK”, he notes.
“The EU is essentially saying there will be no special deal for financial services,” even though only hours earlier Philip Hammond had suggested the UK would reject any trade deal not including financial services, Bennett concludes.
Despite the doom and gloom, the guidelines signal “hope that Prime Minister Theresa May will soften her stance and keep Britain more closely aligned to the bloc”, says Bloomberg.
The draft guidelines state that while the EU’s position “reflects the level of rights and obligations compatible with the positions stated by the UK” , if Britain’s positions shift, the EU “will be prepared to reconsider its offer”.
“Many diplomats in Brussels and across the EU still think they can persuade the UK to at least stay in the bloc’s customs union and single market, if not remain a full member of the 28-nation club,” Bloomberg reports.
EU to offer Canada-style Brexit trade deal despite Theresa May’s demands
The EU will tomorrow publish draft negotiating guidelines for the post-Brexit trade deal that are expected to reject the tenets of the vision outlined by Theresa May last week.
The Guardian suggests the guidelines will be "as vague as possible", while making it “clear that a whole range of proposals made by May in her Mansion House speech on Friday are to be rejected”.
According to the newspaper, an EU diplomat involved in drafting the position of the 27 member states said: “They will say explicitly or implicitly that the guidelines have to be short and general. If the UK position develops then we will be able to develop our response.”
The PM has insisted repeated that a basic “Canada-style” deal for the UK once it quits the EU single market and customs union would not be good enough, given the current extent of EU-UK trading ties.
However, the guidelines “will only contain a very short section on customs and services - and potentially no mention at all of financial services”, says The Daily Telegraph. The draft will be circulated internally among EU member states on Monday and Tuesday as five days of talks get under way, the newspaper adds.
A senior EU source reportedly told the Telegraph: “The message will be, ‘This is what is feasible given the UK’s stated red lines', but should those evolve, so would the available options.”
Meanwhile May and her team are “delighted with how last Friday’s speech has landed so far, winning plaudits from Tory Remainers and Brexiteers alike”, says Politico’s Jack Blanchard.
In terms of party management, the PM’s new tone “appears to have worked on Tory ‘Remainer rebels’ who were plotting a possible alliance with Labour on a customs union in a coming trade bill amendment”, adds HuffPost’s Paul Waugh.
Conservative MP Sarah Wollaston gave her first hint of retreat on Radio 4’s Week in Westminster on Saturday, when she said: “The purpose of signing an amendment is to get the Government to talk to you. We all have to accept we’re not going to get our own way on this.”
But The Guardian columnist Matthew d’Ancona warns May that the battle within her party has only been “deferred” by her speech. “Enjoy the peace while it lasts,” he warns, “for it will not last long.”
Theresa May's Brexit speech sets out 'hard facts'
Theresa May has set out what she called the “hard facts” of the UK’s exit from the European Union, in a speech today in London.
The Prime Minister outlined her five tests to guide Britain in negotiating a final agreement with the EU.
Any post-Brexit deal must respect the referendum result; be a lasting accord; protect jobs and security; and be “consistent with the type of country we want to be as we leave - a modern, open, outward-looking, tolerant European democracy”.
Lastly, it must strengthen “our union of our nations and our people”.
However, the Prime Minister acknowledged for the first time that the plans to leave the single market will mean restricted access to European markets for UK businesses.
“The reality is we all need to face up to some hard facts. We are leaving the single market, our access to each other’s markets will be less than it is now,” she told an audience at London’s Mansion House.
In a key passage that, according to Politico’s Charlie Cooper, May “hopes will land well in Brussels”, she said that “even after we have left the jurisdiction of the European Court of Justice, EU law and the decisions of the ECJ will continue to affect us”.
May also reaffirmed her commitment to having no hard border in Ireland after Brexit, but “did not offer any new proposals as to how this might be achieved”, says The Guardian’s Andrew Sparrow.
She instead referred to the two alternative proposals for customs arrangements with the EU set out in a government paper last summer.
With her talk of “hard facts”, May “sent a message to those - not least her own backbenchers - who’ve been piling on pressure in pursuit of their version of Brexit”, says the BBC’s Alex Forsyth.
The deal on access to each other’s markets had to be on fair terms, she said, with the need for “binding commitments” - a phrase that Brexiteers thought had been removed from the speech’s final draft.
May also set out the UK’s desire for associate membership of European Medicines Agency and other agencies, saying that “sovereignty isn’t an issue because Parliament could ultimately pull us out anyway”.
All the same, that goal may pose a problem, says Sky News correspondent Lewis Goodall, since “if Brexiteers accepted that then they wouldn't be bothered about being in the EU full stop”.
Praising the speech, the Financial Times’ Sebastian Payne described it as “serious, detailed and (mostly) based in reality, but a pretty large and bitter bill” for Brexiteers to swallow.
The New Statesman’s Stephen Bush agrees, saying it gave credence to “smart Brexiteers’ fear that Theresa May is feeding them plenty of rhetoric in order to pass a soft Brexit through Parliament when October runs around”.
“It was the Prime Minister’s best speech on the relationship between the European Union and the United Kingdom since her excellent speech on why we were better off in the EU on 26 April 2016,” Bush declares.
“The difficulty is, it was hard not to come to the same conclusion.”
Theresa May’s Brexit speech: will PM refuse to pay divorce bill?
Theresa May is expected to tell European Council President Donald Tusk that the UK will refuse to pay its multibillion-pound Brexit divorce bill until Brussels backs down over its bid to keep Northern Ireland subject to European Union rules.
May’s meeting with Tusk “may be even chillier than the air temperature outside”, says The Guardian’s Andrew Sparrow. Last week, Tusk said May’s Brexit plans were based on “pure illusion”, following reports of what was agreed at the Brexit war cabinet meeting at Chequers.
Today, Tusk has gone further, saying: ���There can be no frictionless trade outside of the customs union and the single market. Friction is an inevitable side effect of Brexit.”
In response, May is expected to “reiterate the words of Brexit Secretary David Davis, who sent an uncompromising letter to Tory MPs saying that Britain would not finalise financial payments to the EU until ‘all the issues’ of concern to Britain had been addressed”, says The Times.
May will also brief Tusk on “the UK’s proposals for a future relationship with the EU that she will outline in a keynote speech in Newcastle on Friday”, says Politico’s Jack Blanchard.
“May will take Tusk to task over the draft withdrawal treaty published by the European Commission yesterday, which has left British officials livid,” adds Blanchard.
“It actually is much worse than we were expecting,” one official told the news website.
A government source also reportedly told Politico that UK negotiators “asked Michel Barnier not to unilaterally publish what they feared would be an aggressive document and proposed alternative wording of their own, which was rejected by Brussels out of hand”.
Friday’s speech is expected to see May calling for “managed divergence” from the EU, but analysts believe detail will be severely lacking on key issues such as the Irish border.
“Expectations for the speech are high… But despite the high expectations, I think we will be disappointed. I don't think she will be able to give the clarity many in the EU27 and Michel Barnier hope [for],” Rem Korteweg, of international relations think-tank Clingendael, told CNBC.
“She may call for a system of ‘managed divergence,’ but the EU - through presidents Tusk and [Jean-Claude] Juncker - have already dismissed this option as ‘cherry-picking’,” Korteweg added.
Meanwhile, Irish PM Leo Varadker preempted this expected lack of detail, accusing May of reneging on an earlier agreement with the EU on the border issue.
“It’s not OK for people, whether pro-Brexit politicians in Britain or parties in Northern Ireland, to just say ‘no’ now,” Varadkar said. If they did not want the EU’s solution, they must come up with another plan, not just “theoretical stuff”, he told Ireland’s Newstalk radio.
Why has the EU’s draft treaty ‘thrown Brexit negotiations into crisis’?
The terms of the UK’s departure from the European Union have been set out in law for the first time, with the bloc’s chief negotiator Michel Barnier warning that “if Brexit is going to happen, we need to pick up the pace”.
In a 120-page document published today, the European Commision has outlined a draft withdrawal agreement “that will throw the negotiations into crisis”, says The Guardian.
Theresa May told the House of Commons “no UK prime minister could ever agree" to this, saying if implemented, the agreement would “undermine the UK common market and threaten the constitutional integrity of the UK”.
Among the 160 legal articles in what The Times calls the “uncompromising legal text” are several clauses that directly contradict the UK’s objectives, with major flashpoints in three key areas:
The draft agreement mandates that Northern Ireland will remain part of the EU customs union and maintain full regulatory alignment - effectively imposing a new trade boundary in the Irish Sea - should a trade deal or specific proposals to simplify the border arrangements not come to fruition.
“All other questions about Brexit are a matter of negotiation and choice,” says The Times’s Matt Chorley. But “with Northern Ireland, the very outline of the UK as a country is at stake”.
Northern Ireland Secretary Karen Bradley has attempted to downplay a recently leaked letter from Foreign Secretary Boris Johnson to Theresa May, obtained by Sky News, in which he says that “it is wrong to see the task as maintaining 'no border' on the island of Ireland after Brexit”.
Bradley insists that the UK “remains committed to no new physical infrastructure on the border”, but Johnson’s remarks reflect “a hardening mood among Eurosceptics and the DUP on this very topic”, says HuffPost’s Paul Waugh.
Brexiter Tory MP Bernard Jenkin yesterday summed up this mood on BBC Newsnight, saying: “If the EU wants a hard border, and they put stuff up at the border, that’s their problem. That’s not our problem.”
European Court of Justice
Under the terms set out in the newly drafted document, the European Court of Justice (ECJ) will retain legal authority to adjudicate any disputes that arise in relation to the withdrawal treaty.
Tory Brexiteers are already demanding that the Prime Minister refuse to step back from her red line on this issue. Jacob Rees-Mogg told The Times that accepting ECJ jurisdiction would “turn us from a vassal state into a convict state” and must be rejected.
The Brexiteers may get their way, as EU governments “are much more relaxed” about the ECJ’s role than about the other sticking points, says The Times’s Bruno Waterford.
“In [a] confidential internal meeting, Belgium - usually among [the] most doctrinaire on ECJ - accused Barnier of a ‘maximalist attitude’ and called for ‘alternatives’.
Expect change there,” tweets Waterford.
The draft document states that the Brexit transition period will end on 31 December 31 2020, on the final day of the EU’s current long-term budget plan.
During the transition, the “UK will lose all voting rights and decision-making power but must comply with all existing EU laws and regulations - and any new rules adopted by the EU27 - with no recourse if it opposes any new policy”, reports Politico.
The UK is asking for a slightly longer transition, of “around two years”. But “since London has declined to propose a specific end date, Barnier sees the UK as all but asking for an 'open-ended' arrangement”, says the Financial Times.
“Partly for this reason, the EU27 are planning to take a tough position and leave the decision on an extension clause until later in the process.”
Yesterday Barnier told reporters that there are “significant divergences, too many divergences” on transition issues, and that for this reason, a transition agreement was “not a given”.
The EU27 “feel they have leverage on this issue”, says the FT. One ambassador in Brussels told the newspaper that the British PM “desperately needs” a transition agreement in place by the end of March and will be willing to pay a high price to save her government.
EU's draft treaty sparks Brexiter fury
The EU is set to provoke anger among Brexiters by publishing a draft legal text of the Brexit withdrawal agreement which departs significantly from the UK government on Northern Ireland and the European Court of Justice.
Tomorrow, the bloc will set out its legal vision for the UK’s departure in just over one year’s time, and the terms of a transition period that will follow. The British government will then be presented with a 200-page treaty that consists of more than 160 legal articles.
But the treaty is unlikely to go down well on British shores, as it is reported to reject a number of May’s key proposals, including on the Irish border and the European Court of Justice.
On the issue of Ireland, in December the UK committed to avoiding a hard border between Northern Ireland and the Republic, even though Theresa May remained committed to leaving the customs union and the single market.
But in the document to be finalised tomorrow, the European commission “will spell out that, as a last resort to avoid a hard border, Northern Ireland would remain in the EU customs union and aligned to European single market rules,” reports The Guardian.
One senior EU diplomat told the paper the text would reflect that unless there are mutually agreed alternatives: “Northern Ireland is to stay in a de-facto customs union with the EU combined with alignment on trade in goods.”
As the “DUP and Theresa May would of course not allow a new border to be shifted to the Irish Sea... British officials think this is yet another negotiating tactic from Brussels,” says HuffPost’s Paul Waugh.
If that is the case “it now appears that Europe now feels it can force the UK into taking the hard decisions that it has so far failed to make,” says the Daily Telegraph’s Peter Foster.
“The hope that Irish question could be diffused and turned into ‘a question of policy, not politics’ - as one senior Irish official suggested during the afterglow of the December deal - now seems to be lost,” he adds.
Theresa May has sought help from the Irish PM Leo Varadkar over the draft document - but “seems to have got short shrift”, says Politico’s Jack Blanchard.
According to the readout from Dublin, Varadkar made clear to May “the necessity from the EU side to have the detail of the backstop option of full regulatory alignment spelled out in the draft legal text.”
The document is also likely to spark further fury among Brexiteers by insisting that the UK remains subject to the European Court of Justice’s rulings indefinitely after Brexit.
The bloc wants the ECJ to be the ultimate arbiter of treaty-related disputes after the UK’s divorce from Brussels, according to a report in the Financial Times.
But such a move “would place the EU on a collision course with Theresa May, the Prime Minister, who has long insisted that the court’s influence over Britain must end under the terms of the UK’s withdrawal,” says the Daily Telegraph.
Should the ECJ become the dispute settlement body for the withdrawal agreement it would require Britain to accept its rulings well beyond the end of a transition, which the UK wants to last for around two years after Brexit in 2019.
“Indefinite oversight is required because parts of the withdrawal deal, such as the financial settlement of at least €40-45bn, will be potentially discharged over a decade or more,” adds the FT.
Foreign Secretary Boris Johnson hinted at the furore yet to come by saying continued ECJ jurisdiction would be unacceptable for the Government.
The Foreign Secretary told BBC Radio 4’s Today programme: “I say no, that won’t happen, because that has been expressly ruled out by the British people.
“We can’t remain subject to the European Court of Justice and that is part of taking back control of our laws.”
Brexit shift: Jeremy Corbyn wants new customs union with EU
Labour has shifted its position on Brexit and now wants the UK to sign a permanent customs union treaty with the EU, Jeremy Corbyn has announced.
In a speech at Coventry University, the Labour leader said the party “would seek a final deal that gives full access to European markets and maintains the benefits of the single market and the customs union”.
“Labour respects the result of the referendum and Britain is leaving the EU,” he said. “But we will not support any Tory deal that would do lasting damage to jobs, rights and living standards.”
The policy shift opens up the possibility of “Labour siding with Tory rebels to defeat Theresa May on her Brexit strategy”, the BBC reports.
Shadow Brexit secretary Sir Keir Starmer gave a glimpse of the party’s new position on post-Brexit trade on the BBC’s Andrew Marr show yesterday.
Starmer told Marr the Labour front bench was “unanimous” in its desire to leave the customs union and then negotiate a permanent treaty that will “do the work of the customs union”. Jeremy Corbyn is expected to detail the plans when he speaks today.
Starmer said a permanent customs union was the “only way realistically to get tariff-free access” to the EU. He added that the UK was more likely to achieve “bold new trade agreements” if it was negotiating them jointly with the EU.
International Trade Secretary Liam Fox also appeared on the Andrew Marr Show, saying that the Opposition’s position did not “make sense”.
“Labour say they want to join a customs union,” he said. “What does that mean?
“Is it like Turkey, which has a customs union but only in goods, not in agriculture, not in services, not in finance? Is that what we want for Britain?
“Will we take rules in certain sectors but not in others?”
Brexit Secretary David Davis said Corbyn was selling “snake oil” by pretending a new customs union was a simple solution to the challenge of Brexit.
Off the fenceLabour has “come down firmly on the side of a softer Brexit, after months of hedging its bets”, says Emma Vardy of the BBC. Next, the party will intensify its efforts to persuade Tory rebels to join it in opposition to Theresa May’s plans, she adds.
Corbyn’s intervention “comes amid a deep split within the Conservative Party over the issue”, says The Daily Telegraph, “after five pro-European Tory ‘mutineers’ tabled an amendment which could force Theresa May into accepting a post-Brexit customs union.”
But siding with the Opposition to try to force May into a softer Brexit would be a high-risk strategy for soft-Brexit Tories, says Vardy. “It could pave the way to another general election, which might just deliver a Labour government,” she warns.
Brexit awayday: crunch time for Cabinet at Chequer
Theresa May and her cabinet will be forced to hammer out a coherent Brexit strategy when they convene for a crucial meeting at Chequers this afternoon.
Brexit Secretary David Davis said senior ministers would be “locked in a room” at the Prime Minister’s country retreat until the details of Britain’s future relationship with the EU were decided.
The meeting follows “months of public sniping” between the rival camps over how clean a break Britain should make with Brussels in March 2019, Nigel Morris writes in the i newspaper.
Philip Hammond and other Remainers are pushing for close regulatory alignment with the EU, while Brexiters, including Boris Johnson, are demanding complete autonomy.
“The traditional divides on the committee are still there,” a cabinet source told The Sun. “It’s now coming down to the speed at which we diverge which means whether or not to accept new EU rules.”
The source added: “It looks like the PM will have to finally get off the fence for one side or the other.”
The high-stakes meeting comes just days before the Prime Minister is due to set out her negotiating priorities in a speech, and a month before formal trade talks begin.
But “despite the hype, we already know the Brexit solution [she] is heading for”,says James Blitz in the Financial Times. The goal is a trade relationship dubbed “managed divergence”, which would allow the UK to cherry-pick parts of the single market it wants to remain part of.
Given that such a position would be unacceptable to the 27 remaining EU members, Blitz asks, why is May’s team pursuing such a flawed approach? “Answer: they think that, despite initial resistance from Michel Barnier and the commission, the UK can gradually win over EU capitals.”
Brexit: Theresa May handed ‘ransom note’ by backbench MPs
More than 60 backbench Tory MPs have written to Theresa May listing their “red line” demands for the UK exit from the EU, eliciting a livid reaction from some of their party colleagues.
Nicky Morgan, chair of the Treasury Select Committee, described it a “ransom note”, adding that the party’s European Research Group (ERG) “clearly think they have the Prime Minister as their hostage”.
The Times suggests it is high time the PM hit back, saying: “Mrs May promised a safe pair of hands. A safe pair of hands would give the ERG a slap.
”The MPs’ letter “should be seen as a warning shot from the Tory Brexit squad to May and her top team”, says Politico's Jack Blanchard.
The ERC suggestions include complete regulatory autonomy and a promise that the UK can negotiate new trade deals with third countries as soon as Britain officially leaves the EU in March 2019.
The Spectator’s Katy Balls says it could have been a lot worse for May, with the letter tackling issues on which the ERG’s position was already fairly well known.
“More interesting than the contents is what’s not in the letter,” Balls adds, noting there is no mention of freedom of movement - which should come as a relief to No. 10, she says.
Meanwhile, Bloomberg reports that a leaked draft legal document shows that the UK wants the interim transitional period to last at least 24 months.
“The UK believes the period's duration should be determined simply by how long it will take to prepare and implement the new processes and new systems that will underpin the future partnership,” the document reportedly says.
The leaked request for “an effectively open-ended transition period will anger Conservative Eurosceptics who have described the arrangements as reducing Britain to a ‘vassal state’”, says The Times.
Dutch trigger border plans for ‘no-deal Brexit’
One of the UK's biggest trading partners has activated a hard Brexit” contingency plan that will see between 750 and 930 new customs officers recruited to shore up ports after Britain leaves the EU.
The Dutch government has already hired 50 customs officers, with plans to immediately recruit and train hundreds more. “They are preparing themselves for friction,” says Sky News reporter Faisal Islam.Pieter Omtzigt, the Dutch parliament’s Brexit rapporteur, told *The Guardian* that a trading nation such as the Netherlands cannot afford customs problems, adding that “it would be a disaster”.
Recruitment adverts will start appearing this week to beef up the existing 5,000-strong customs force, according to DutchNews.nl.
“We can’t wait until there’s a deal, because you can’t train all those people in one week,” Anne Mulder, an MP charged with assessing Brexit from the Dutch perspective, told Amsterdam-based newspaper NRC last month.
Britain is the Netherlands’ second-largest trading partner, accounting for 9% of exports, according to a Reuters report last year.Theresa May will host Dutch PM Mark Rutte this week as part of a UK charm offensive to win over EU27 leaders ahead of March’s European Council, where the transition agreement is on the table.
The Dutch plans surfaced as Brexit Secretary David Davis was in Vienna trying to calm Brexit fears of a Mad Max-style Brexit aftermath.
Brexit: can Boris Johnson reunite a divided nation?
Boris Johnson kicked off the “road to Brexit” series of government speeches today, warning that it would be a “disastrous mistake” to reverse the 2016 referendum and insisting that leaving the European Union is “not grounds for fear, but hope.”
“It’s decision time for the government and Johnson is drawing his line in the sand as publicly as possible,” says Politico’s Jack Blanchard.
Theresa May and her Brexit war Cabinet will decamp to the PM’s country retreat Chequers next week to thrash out - yet again - what they want from Brexit, which May will present to Brussels in a speech to the European Council.
But before that, Johnson hopes his Valentine’s Day speech will “reunite a divided nation,” says The Times’s Matt Chorley.
“If we are to carry this project through to national success – as we must – then we must also reach out to those who still have anxieties,” according to the Foreign Secretary.
“It is not good enough to say to Remainers – you lost, get over it; because we must accept that many are actuated by entirely noble sentiments, a real sense of solidarity with our European neighbours and a desire for the UK to succeed.”
Although “his speech has been vetted by No. 10, Boris has been allowed to stray onto the territory of future trade with the EU,” says HuffPost’s Paul Waugh.
Johnson claimed during his speech that Brexit represented a “natural desire for self-government of the people, by the people, for the people” and a break from EU politicians’ plan to “create an overarching European state as the basis for a new sense of European political identity”.
Johnson’s mention of a European superstate was met with scorn by European Commission President Jean-Claude Juncker, who told reporters in Brussels today that he was “strictly against” a superstate and that Johnson was talking “total nonsense”, The Independent reports.
Last night, it appeared that Johnson’s bid to serenade Remainers would fall on deaf ears.
Labour’s Chuka Umunna, Green Party co-leader Caroline Lucas and British Trades Union Congress boss Frances O’Grady rejected the Foreign Secretary’s Valentines Day advances, variously declaring him “a liar and a scaremonger who exploited immigration and misled the public about a Brexit ‘dividend’ for the NHS,” says Waugh.
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