Cabinet rejects plan to keep UK half in single market: Brexit News for Saturday 10 February

Cabinet rejects plan to keep UK half in single market: Brexit News for Saturday 10 February
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Michel Barnier tells Theresa May a transition deal is ‘not a given’…

The EU’s chief Brexit negotiator warned Theresa May today that a transition deal is “not a given” as European officials said “substantial” disagreements risked derailing talks. Michel Barnier hit back at claims by David Davis, the Brexit secretary, that the European side was acting in bad faith in the negotiations. He accused Mr Davis of introducing “surprising” new demands into the transition talks, adding that the number of disagreements meant that an agreement was “not a given”. In a barbed attack on Mr Davis’s infrequent appearances at talks in Brussels, he denied British claims that the EU side were deliberately cancelling negotiating sessions.- The Times (£)

  • EU Brexit chief Michel Barnier accused of bullying – The Sun
  • Michel Barnier’s spiky press conference – Katy Balls for the Spectator
  • Brexit war of words could end in victory – Oliver Wright for The Times (£)

…and issues an ultimatum over Northern Ireland remaining in the customs union…

The EU will prepare a draft of the U.K. withdrawal treaty that envisions Northern Ireland remaining in the customs union — essentially issuing an ultimatum that London come up with other options or accept that there is no other practical way to avoid the recreation of a border between Ireland and Northern Ireland, the EU’s chief negotiator, Michel Barnier, said Friday. Speaking at a news conference alone, rather than alongside his U.K. counterpart, David Davis, Barnier insisted that the EU has no choice but to begin drafting such legal language because London has offered no clarity on how the Ireland-Brexit conundrum might be solved as part of an overall new relationship. – Politico

…as the Irish Europe minister demands clear border plans from the UK

Ireland’s Europe minister has said it is yet to see proposals from the UK on what is and what is not possible for the Irish border post-Brexit. Helen McEntee told the Today Programme the issue becomes “more and more difficult the more proposals you take off the table”. “There are a lot of red line issues for the UK,” she added. Ms McEntee said Ireland are looking for clear proposals on what the UK wants. – BBC News

  • Hard Brexit ‘to cost Ireland €18bn’ – The Times (£)
  • The Belfast Agreement should not be hijacked to sacralise Dublin’s demands – Henry Hill for ConservativeHome

> Hugh Bennett on BrexitCentral this week: It’s time to stop doom-mongering over the Irish border – the solutions are already out there

Cabinet Leavers reject Theresa May’s plan to keep Britain half in EU single market, branding it ‘a plot to frustrate Brexit’

A new compromise bid by Theresa May to keep Britain half in the EU’s single market has been rejected by Cabinet Leavers as “a plot to frustrate Brexit”. The Sun can reveal that the PM’s top EU advisor Oli Robbins pitched the plan to a key meeting of the PM’s 11-strong Brexit Committee on Thursday. The newest bid by Theresa May to keep us half in the EU’s single market has been rejected. Under it, Britain would maintain very close alignment to the EU’s rule book for hard goods, but diverge from Brussels edicts on the services sector. That would keep trade and supply lines for products such as machinery, cars and planes flowing freely with Europe and protect jobs, Mr Robbins argued. – The Sun

UK factories post best year since 2014 as exports boom…

U.K. factory production extended its record run in December, capping the strongest year since 2014. Manufacturing rose 0.3 percent from November, the Office for National Statistics said Friday. Overall industrial output slumped a larger-than-forecast 1.3 percent after the closure of a key North Sea pipeline led to a steep drop in oil output. Separate figures show construction output rose 1.6 percent and the trade deficit widened to 4.9 billion pounds ($6.7 billion). Manufacturers are enjoying their longest expansion in three decades – output has risen for eight consecutive months – as strong global growth and the past depreciation of sterling boost exports. – Bloomberg

…as UK exports to the EU fall

The UK’s trade deficit, or how much its imports are exceeding its exports, widened again in the three months to December 2017, as exports to the EU shrank. Total UK trade deficit, including goods and services, widened by £3.8bn to £10.8bn according to statistics from the Office for National Statistics (ONS). Excluding erratic commodities, such as oil and gold, the deficit widened by £1.5 billion to £9.0 billion. According to the ONS, the widening of the deficit was mainly (£3.3 billion) due to trade in goods. Rising oil prices, a 3.8 per cent increase in imports from non-EU countries, and a decrease in exports to the EU, all helped to increase the gap. – City A.M.

British fishermen set to have better non-EU trading deals post Brexit

The Treasury’s secret Brexit analysis shows UK fishermen will be better off under every Brexit scenario – proving another Remain campaign pledge wrong. During the referendum David Cameron told British fishermen they were “better off from within” the Common Fisheries Policy, which limits the amount of fish they can catch in UK waters. But the sensitive Treasury document that forecasted the economic effect of three Brexit models – leaked to Buzzfeed last month – said Britain’s fishing industry will be better off under every possibility. Crashing out of the EU without a deal would leave Britain trading with Brussels on World Trade Organisation terms – freeing UK fishermen from restrictive EU fishing quotas. – The Sun

Anna Soubry says she is not sorry for calling on May to ‘sling out’ Brexit MPs…

Conservative MPs who want the closest possible relationship with the European Union have been ramping up their efforts to prevent the party’s arch-Brexiters from getting their way, Anna Soubry has said. The MP for Broxtowe argued that the economic necessity of preventing a hard break from the EU meant she was not sorry for suggesting that Theresa May should “sling out” ardent leave campaigners from the party. “Because I think like a lot of people in the Tory party and indeed Conservative voters, I think there is real concern now about the direction of travel when it comes to Brexit,” she said. “We are reaching a real crunch point and the government hasn’t worked out, 19 months on, what its end game is. And we need to know.” – Guardian

> Previously on BrexitCentral: Anne-Marie Trevelyan criticises Anna Soubry’s failure to remain ‘civilised’ over Brexit

…as Nick Clegg backs ‘constitutional crisis’ to halt Brexit

British MPs should vote to reject the government’s final Brexit plan when it comes to a vote later this year — even though that will trigger a constitutional crisis, former Deputy Prime Minister Nick Clegg said. Speaking to Politico’s EU Confidential podcast in Brussels this week, the former Liberal Democrat leader also attacked Prime Minister Theresa May’s Cabinet, describing its ministers as “muppets” who had destroyed the British government’s reputation for competence. Pro-Brexit MPs have argued the British parliament should approve whatever deal May strikes with the European Union over Brexit as to do otherwise would go against the will of the people expressed in the 2016 EU referendum. – Politico

Senior SNP MP tells his party to stop lecturing Scots on the benefits of an EU from which they feel ‘alienated’

Nicola Sturgeon’s Brexit strategy has been undermined by one of her most senior MPs after he urged the SNP to stop lecturing voters about the virtues of a European Union they feel “alienated from”. Pete Wishart, who is considering standing for the party’s deputy leadership, argued there was “no point chastising” people who voted Leave in the EU referendum if the Nationalists are to win a second independence vote. The chairman of the Commons Scottish affairs select committee urged the SNP to stop “simply extolling” the benefits of the EU and “face up” to the reality that Scotland will be outside of the EU and part of the UK in a year’s time. – Telegraph (£)

Could Canada’s hi-tech border controls provide the answer to Britain’s customs union dilemma?

For Matt Marchand, the border between Canada and America never meant that much. Born and raised in Windsor, Canada’s most southern city, the lights of Detroit could be seen just across the river. Despite the two cities being in different countries and separated by half a mile of water, he saw them as part of one whole. “It is very similar to going from the north side of the Thames to ‪the south side‬,” he says, recalling nipping into America for dinner in the evening or to meet friends. “If you’ve lived here and grown up here, going to Detroit is not necessarily viewed as going to a foreign country.” As Britain’s political class grapples to define its new trading relationship with Europe after Brexit, attention has been drawn to the Detroit-Windsor crossing. – Telegraph (£)

The Sun: We’re sick of being treated like mugs – and it’s time the PM woke up to it

How much longer must we endure the EU’s arrogant insults and obstructive tricks? Time for a deal is running out. Brussels seems intent on running down the clock and railroading Britain into permanent disaster. Theresa May MUST be alive to it. The nation needs to be ready far in advance of any no-deal exit in March 2019. Once it’s too late, what choice will the PM have but to accept Any offer? Some EU nations want a decent deal. All we see from France and Germany is a desire to disadvantage us forever. But there is no more time for his games. Besides, we prefer to take him at his word. He speaks for 27 nations. It is safer not to second-guess him. Believe what he says and act on it. When Barnier says even the transition is no longer “a given” we should say OK, here’s something else “not a given”­­ . . . 39 billion of our British pounds ­plugging the black hole in your budget. – The Sun editorial

Gerard Lyons: With flexibility and competitiveness, the City can prosper after Brexit

There is plenty for the City of London to be positive about. Despite Brexit and the recent volatility of financial markets, there are numerous opportunities for the City to reaffirm its status as the financial capital of the world. But there is no room for complacency and, as I argue in a new report for the IEA, finance needs to remain flexible, forward looking and competitive. Over the last year it has shown this, positioning itself well in areas such as green bonds, trading the offshore Chinese currency, Islamic finance and financial technology (FinTech). – Gerard Lyons for CapX

Malcolm Barr & David Mackie: EU is wrong to obsess over fiscal union

A myth is stalking the euro area which, despite being nearly universally accepted, is almost certainly wrong. This myth is that a quick move to deeper fiscal, banking and political integration in the region is needed to either prevent or resolve a future crisis. The source of this myth is the most common interpretation of the causes of the 2011-12 EMU sovereign crisis: the region experienced a crisis because the house of EMU had only been partially built. It was a monetary union without a fiscal, banking or political union. At some level this is true. If the euro area had looked like the US in 2011-12, with a large federal tax and benefit system and a federal bond market, then the region would either not have had the crisis that it did or it would have had a very different one. But that particular federal destination is not on offer. – Malcolm Barr & David Mackie for the Telegraph (£)

Brexit comment in brief

  • £350 million more a week for the NHS. Why set our sights do low? – Paul Barnes for ConservativeHome
  • Britishness is a political, not a racial, characteristic – Andrew Gimson for ConservativeHome
  • Remainers are fighting a losing – and misguided – battle – Alex Massie for CapX
  • Brexit: the obvious errors – Dr Sean Walsh for CommentCentral
  • 18 months on and Project Fear has been proved wrong on every front – Get Britain Out’s Peter Lyon for Reaction
  • Corbyn’s Labour Party is a threat to Brexit –  Get Britain Out’s Robert Bates for the Commentator
  • George Soros: the billionaire philanthropist taking on the Brexiteers – Philip Delves Broughton for the Evening Standard
  • Does the Euro area still need or want stable national governments? – John Redwood’s Diary

Brexit news in brief

  • Goodbye letter to Brussels cost almost £1,000 – The Times (£)
  • Pro-EU thugs send anonymous death threats to businessmen who gave money to Brexit campaign – The Sun
  • Brexit cracks Europe’s capital markets vision – Politico
  • May turns to Chinese billionaire Jack Ma for post-Brexit trade ideas – Guardian
  • Official document raises prospect of changing workers’ rights after Brexit – Independent

And finally… Divorcée ‘lost £26m because of Brexit vote’

A woman claims that Brexit cost her £26 million in her divorce settlement. Camilla Versteegh, 52, was awarded £90 million in cash and assets from the fortune of Gerard Versteegh, a property tycoon, but claims that she was due £116 million. The couple were married for 21 years, during which they and their three children lived a “truly exceptional” lifestyle, with a £60 million home in Kensington. The financial settlement was decided just after the vote to leave the EU in 2016. Tim Bishop, QC, for Mrs Versteegh, told the Court of Appeal that the judge had mistakenly declined to value her former husband’s Dooba group of companies, “an extremely complex corporate structure”, because of the “uncertainties of the post-Brexit landscape”. – The Times (£)