The Secretary of State for International Trade (aka Liam Fox MP), recently called for the UK to leave the EU Customs Union for the obvious reason that the Customs Union impedes the ability of the UK to make separate trade deals with non EU member states.
Now the very widely respected Chairman of the Public Administration and Constitutional Affairs Select Committee, Bernard Jenkin MP, has written this for the Financial Times:
That is in sharp contrast to the position of the Chancellor which is: “to ensure access to the single market for our financial services industry”. But the, the Chancellor is doubtless aware of the contribution the City of London makes to UK tax revenue – see this from the Guardian: “London pays almost a third of UK tax, report finds“.
It would be interesting to hear from Mr Jenkin how he proposes that the tax revenue from the City would be replaced and what changes to the budget he would recommend were the revenue to be lost.
This development in the EU position was not unexpected (indeed it was the view of Clown Boris (now HM Foreign Secretary) that such an offer would be forthcoming .Such an offer permits a good case to be made either (i) for remaining in the EU, or (ii) for opting for a solution akin to the Norwegian model of single market access.
Ideally, it would be preferable for the UK to opt for a “Remain” solution along these lines because that would permit continued UK involvement in the formulation of single market policy while the Norwegian model involves acceptance of EU legislation without participating in the making of it.
Sebastian Payne writing today in the Financial Times has this: “Theresa May positions herself against ‘hard Brexit’“. The article concludes that Mrs May is laying the groundwork for a more moderate Brexit that will attempt to assuage Leavers and Remainers and that once the best solution emerges, she will attempt to boot out those demanding an instant “Hard Brexit“.
Names mentioned included the usual suspects: Ian Duncan Smith MP, John Redwood MP, Bill Cash MP and Steve Baker MP. Generally, anyone involved with the man who likes to be referred to as “IDS” is likely to end up In Deep Shit and in this case the “Deep Shit” will adversely affect the many neglected people in deprived areas who voted “Leave” not least because of things IDS did when he was in charge of welfare.
About a month ago, The Scotsman has this on Brexit Lite: “UK could adopt ‘Brexit-lite’ approach of quitting EU“. It was then and remains the best option for giving effect to the result of the referendum which David Cameron so ill-advisedly promised to the Brexiteers.It remains to be seen how the Prime Minister will now deal with the pretensions of the “usual suspects“. Teresa May may well prove to be a lot tougher with back-bench rebels than David Cameron ever was.
The “Torygraph’s” verdict is of importance to the Conservative Party, especially in the run-up to the Party Conference, and it may be thought that this article will be welcomed in No 10 Downing Street.
However, while Mrs May’s “getting to know you” visits to Berlin and Paris went as well as could be expected, the Telegraph points out that at the post meeting press conference, President Hollande made a key observation about Free Movement:-
” He insisted that while France would reluctantly grant the UK some wiggle room on the timing of Article 50, on the thorny issue of free movement of people, there would be none.”
Rightly, the Telegraph points out: ” It is this that will be the key conundrum of the coming talks – how Britain can assert some control over EU worker migration while retaining access to the EU single market.“
Mrs May was Home Secretary before becoming Prime Minister. She knows only too well how impossible it was to meet the daft commitment of the Cameron government to reduce net migration to the tens of thousands while respecting the EU “free movement” obligation.
She must also be aware that the Home Office relocated asylum seekers to the poorest towns in England in order to save money. See this article in the 26th January 2016 issue of the Sun: “Map reveals the top 10 UK towns where asylum seekers are being ‘dumped’“. The MP for Rochdale is reported in the article as saying: “You have groups of asylum seekers, who through no fault of their own have nothing to do because they are not allowed to work, wandering around the town centre, not speaking English. It’s not fair on the asylum seekers and it’s not fair on Rochdale residents.”
Perhaps it is fair to say that while Mrs May loyally supported her predecessor’s campaign to remain in the EU, she is aware of the impact of immigration on the referendum vote. So she is willing to attempt to find a solution which permits the UK to continue to have access to the single market in goods and services WITHOUT free movement.
Obviously, Clown Boris had to say something like that. But Amsterdam, Dublin, Frankfurt and Paris, are queuing up to offer their cities as headquarters for London’s EU financial services operations.
It remains to be seen whether the efforts to obtain continued access to the EU single market for goods and services without a commitment to free movement will be possible but there are numerous experts who consider it highly unlikely to succeed since it is one of the EU “sacred cows”.
We know that the judicial review application seeking to ensure that Parliament vote to authorise the triggering of Article 50 of the Lisbon Treaty is due to be heard in October with the Divisional Court already making provision for an eventual “leapfrog” appeal to the Supreme Court. This is an important matter of some constitutional importance.
While Mrs May is making the rounds of the European Capitals to see what can be done about the Brexit Vote, it will be important that all the players have regard to an ongoing threat to European Defence and NATO. The first duty of any national government is to assure the defence of the nation. All those EU countries who were once in the Warsaw Pact: the Czech Republic, Hungary, Poland, Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia, Slovenia and Albania know the dangers of being close neighbours of Russia – and indeed, for most of them, NATO membership was a more urgent and important matter than membership of the EU.
But it is entirely possible that Donald Trump could become the next President of the USA. Yes, it’s a horrible thought.
The NYT article summarises the Trump Defence policy thus:
“Mr. Trump repeatedly defined American global interests almost purely in economic terms. Its roles as a peacekeeper, as a provider of a nuclear deterrent against adversaries like North Korea, as an advocate of human rights and as a guarantor of allies’ borders were each quickly reduced to questions of economic benefit to the United States”.
In those circumstances, the European members of NATO have to consider that they may no longer be able to rely on the USA as the guarantor of European security. It is worth looking at this paper: “The UK and European defence: leading or leaving?” which gives a lot of the background to the UK’s dealings with the other EU Member states on Defence. There is a long history of both the USA and the UK unsuccessfully seeking to persuade other EU NATO members to step up to the plate on Defence spending.
The USA spends 3.5% of GDP on Defence. The UK spends 2.2% of its GDP on Defence, but the majority of European states spend less than 2%. That may now have to change – and quickly.
Further, there are only 2 nuclear weapons states in Europe: the UK and France. So with the USA possibly being set to renege on its NATO obligations, the ultimate nuclear deterrent rests on just two European powers.
The UK Parliament has just voted to renew its Trident Nuclear submarines. What this is really going to cost the UK is difficult to ascertain. See this in the Guardian: “Trident renewal: would £205bn be a price worth paying?“. France also maintains its nuclear deterrent capability. See: NTI – France. Britain and France co-operate bilaterally to maintain their capabilities – but while these are national capabilities they are also in reality a NATO capability protecting those EU states which are NATO members.
Bayeux is located seven kilometres from the coast of the English Channel and 30 km north-west of Caen. Bayeux is best known to visitors for the Bayeux tapestry, made to commemorate the 1066 Norman Conquest of England.
During the Second World War, Bayeux was the first city in France to be liberated during the Normandy Campaign. The British Bayeux War Cemetery is situated in the south-western outskirts of the town on the by-pass, which is named Boulevard Fabian Ware. On the opposite side of the road stands the Bayeux Memorial:
The inscription translates: “We (British) once conquered by William have returned to set free his native land.” With two uncles in WW2 war graves in France, I have always been a fervent supporter of the European Union. I am sad to see our Government reneging on the deal because of the idiocy of the Brexiteers who infest the Conservative Party. It is to be hoped that a solution will be found which will recognise the common interest of the UK and its European partners.
Well, it looks as though Mrs May has by and large completed the organisation of her Ministry, she has presided over her first Cabinet meeting and she faced PMQ’s in the Commons today before beginning a round of visits to her opposite numbers in Germany and France. At PMQ’s she performed very well and dealt very easily with Jeremy Corbyn who must have come away from the session feeling less than happy.
The change seems eminently sensible. No government should promise what it cannot deliver. The Cameron “tens of thousands” target was always impossible, particularly because of EU “free movement”, but also because it was unfair to others who had lawful family reunion, marriage, and other proper claims for admission.
It looks as though the Labour Party is making an attempt to resolve the differences between the Parliamentary Party and the the Leader by way of a Leadership challenge – see this report in The Guardian: “Owen Smith to face Corbyn in Labour leadership challenge“. Whether this will mean that there will be an effective Opposition from Labour after the Summer recess remains to be seen. The Telegraph has this: “Labour stares into the abyss” with this observation: ” It is impossible to speak of Labour under Mr Corbyn as an alternative government.” Today’s PMQ’s served only to reinforce that observation.
(1) the Divisional Court will hear the case in October and after the decision may well allow a “leapfrog” appeal to the Supreme Court so that the issue can be resolved as quickly as possible;
(2) at the hearing the Government would not trigger Article 50 before the end of the year so the the Court will have time to rule on the matter first;
(3) there has been trouble with law firms and clients receiving racist and anti-Semitic abuse from Brexit fanatics and Court warned that ‘aggressive and threatening abuse’ could amount to a criminal offence and would be dealt with ‘very seriously’.
“The previous Government’s considered view not to instruct key Departments including the FCO to plan for the possibility that the electorate would vote to leave the EU amounted to gross negligence. It has exacerbated post-referendum uncertainty both within the UK and amongst key international partners, and made the task now facing the new Government substantially more difficult.”
“The lack of contingency planning inevitably means that the Government’s plans are tentative and just emerging. We intend to examine these at the earliest available opportunity, including how the Government plans to consult other interested parties in the UK.”
Small wonder that the Foreign Affairs Select Committee is worried. After so may years in the EU (during which time trade deals were negotiated by the Commission on behalf of all Member States), the United Kingdom simply does not have the requisite expertise, whether among Ministers or Civil Servants. To make matters worse, trade deals cannot made with other countries until after the UK has left the EU.
It is properly arguable that the UK’s interests would be best served by the UK doing exactly what other EU Members have done after a negative referendum result: somehow finding a way to reverse a referendum decision which is against the national interest.
But unless and until the Three Brexiteers fail in the process of preparing a viable Brexit plan, Mrs May is hostage to the stance she has thus far taken.
Leavers:Anna Soubry MP (formerly Business Minister) has resigned from the Government. So has Baroness Altman (formerly Pensions Minister) and also Ed Vaizey MP (formerly Culture Minister) also Dom Raab, and Justin Tomlinson, Mark Francois, George Freeman, Sir Desmond Swayne, Hugo Swire, Julian Brazier, James Duddridge, Charlie Elphicke, John Penrose, Andrew Selous and Baroness Verma.
The Conservative Home blog has a useful post: “Meet the new team at Number Ten” which provides some insight into the PM’s private office: all the former David Cameron aides have been sent packing and the first 6 key May aides are given as: (1) Nick Timothy: Joint Chief of Staff, (2) Fiona Hill: Joint Chief of Staff, (3) John Godfrey: Director of Policy, (4) Katie Perrior: Director of Communications, (5) Lizzie Loudon: Press Secretary, and (6) Liz Sanderson: Head of Features. The post gives some insight into the background of each.
The UK Prime Minister visits the Scottish First Minister
If nothing else, the meeting of the UK Prime Minister and the Scottish First Minister at Bute House shows how far we have moved on since 1558 and John Knox’s proposition:
“To promote a woman to bear rule, superiority, dominion, or empire above any realm, nation, or city, is repugnant to nature; contumely [an insult] to God, a thing most contrary to his revealed will and approved ordinance; and finally, it is the subversion of good order, of all equity and justice” [First Blast of the Trumpet against The Monstrous Regiment of Women].
It is to be hoped that as a supporter of the Union, the Prime Minister has come away from Scotland with a very clear understanding that Brexit might very well be the trigger for the withdrawal of the nation of Scotland from the Union.
Other Brexit Issues
No-one will be surprised that the sad events in France and Turkey take up much of the space in the Sunday papers – pushing Brexit issues off the front and inside pages – with few exceptions.
“Mr Johnson’s first foray will be a meeting with EU foreign ministers on Monday in Brussels. Celebrity and brash behaviour will not go far in the pursuit of strategic goals – and Britain right now has much to try to secure. Mr Johnson will no doubt continue to make headlines, because that is his special talent. But his appointment is, simply, very bad news”.
Brexit = Break-Up of the Union ?
The Prime Minister is due to travel to Scotland today. No doubt she will have access to this morning’s headlines in the Scottish newspapers:-
One supposes that Sun readers quickly lose interest in text that does not have pictures or graphics.
This rather charming exercise in tarting up the text might serve to remind people just who the old codger newly recycled as Secretary of State for Brexit really is. He has rather faded from the public mind since he last held office as Minister for Europe in the John Major Government until 2nd May 1997 when he was replaced by Douglas Henderson – though he has since been a fairly well regarded member of the Conservative Party’s “Awkward Squad” on the back benches. – declining to join the Cameron coalition government in 2010.
However, the Financial Times has a very good “Brexit Briefing” e-mail service and Mr Davis’s article was discussed in this morning’s FT e-mail:-
“How credible a negotiating strategy is this? Not very, says John Springford of the Centre for European Reform. “Mr Davis does not understand the economics. Some 45 per cent of UK exports go to the EU and, on average, about 8 per cent of the exports of each member state go to the UK. So there is far more at risk for Britain in conducting a hard ball trade strategy with the EU.”
Springford says: “Overall, I don’t think Mr Davis’s piece really tells us much about what the UK’s negotiation will really be like. The analysis is so flawed that the mandarins in Whitehall will tell him he has to think again.”
I’m not so sure about the Mandarins. Most of those with good experience of negotiating trade deals have either retired or moved to Brussels where the EU can make good use of them – and they will probably prefer to remain there.