Brexit News for Thursday 16 March

Brexit News for Thursday 16 March

Queen prepares to sign Article 50 Bill into law today…

The Queen is expected to give Royal Assent to the Brexit bill in the next few hours, paving the way for Theresa May to trigger Article 50… When it becomes law, the Prime Minister is free to decide when to invoke the two-year negotiation period for Britain to leave the EU. Downing Street has suggested this is not likely until the last week of March… Government sources say Royal Assent is likely to be granted at around 11am. – Sky News

…as senior Brussels figures warn triggering Article 50 by next week ‘now critical’

Brexit negotiations with the European Union will not start until June unless Theresa May triggers Article 50 by next week, senior diplomats have warned. Leaders of the remaining 27 states had planned to offer the UK a substantial response to the government’s Article 50 notification at a European Council summit on April 6. However, senior figures in Brussels have warned that the timetable will be too tight if Mrs May triggers Article 50 in the last week of March. Because of the timing of Easter and the French presidential elections the next summit could not take place until the end of May. That means substantial talks would not get under way until June — cutting into the two-year negotiating window, which is already expected to be shortened as a deal must be ratified by European leaders and the British and European parliaments. – The Times (£)

EU will not be ‘intimidated’ by Theresa May’s threat to walk away without a Brexit deal, says Donald Tusk…

Reporting back on last week’s Council summit, Mr Tusk told the European Parliament the EU wanted Brexit talks to be “constructive and conducted in an orderly manner”. But he added: “The claims, increasingly taking the form of threats, that no agreement will be good for the UK, and bad for the EU, need to be addressed. I want to be clear that a ‘no-deal scenario’ would be bad for everyone, but above all for the UK, because it would leave a number of issues unresolved. We will not be intimidated by threats, and I can assure you they simply will not work. Our goal is to have a smooth divorce and a good framework for the future. And it is good to know that Prime Minister Theresa May shares this view.” – Daily Telegraph

…as David Davis tells the MPs that the Government has not yet fully assessed the impact of leaving EU with no deal…

Asked if an assessment had been carried out of the overall impact of this on the economy and businesses, Davis said: “They made an estimate during the referendum campaign, but I think one of the issues that’s arisen is that those forecasts don’t appear to have exactly been very robust since then.” This did not mean the issue was not being considered, Davis added, saying he had briefed the cabinet on the need for contingency planning in case no deal was possible at the end of the two-year Brexit process. “This is part of an ongoing process that started last year,” he said. “And it’s rigorous across every department of state, every single one. It ranges from customs through to agriculture and what we do there, to nuclear safety – every single department of state.” – The Guardian

  • Who is the Brexit Secretary David Davis? – Nicholas Watt for BBC News

…while insisting that the Common Travel Area with Ireland is not up for negotiation

The Brexit Secretary restated Britain’s commitment to keeping the border with the Republic as open as possible, suggesting that a new customs regime could be based on the existing “trusted trader” system for collecting excise duties. “The fact is there is a border there now and there are excise duty differences across the border, which are collected, which are dealt with. But it operates in a subtle and not highly visible way,” he said. “I am confident that the two nations and the Commission between them will be able to solve this because we really want to, because the technology is better than it was 20 years ago and because we all understand the value of it.” – Irish Times

Theresa May declares that Scotland is leaving the EU no matter what…

The prime minister seized on comments from the European Commission on Monday, which suggested that an independent Scotland would have to apply to join the EU, rather than automatically being a member. Commission spokesman Margaritis Schinas said the “Barroso doctrine” continued to apply – a reference to former commission president Jose Manuel Barroso setting out the legal view that if one part of an EU country became an independent state it would have to apply for EU membership. – BBC News

  • May set to refuse Scottish Independence referendum until after Brexit – The Guardian
  • Brexit causes most stress to young, well-educated Scottish women – The Independent
  • Could pro-EU No voters swing it for Sturgeon in a second referendum? – Ashley Kirk for the Daily Telegraph
  • Scottish Leavers could hold the key to sinking Sturgeon’s dream of independence – Joe Ray for ConservativeHome

…as Iceland warns that Scotland could not apply to join EFTA until after independence

A separate Scotland would face years outside the EU single market, it has emerged after Iceland warned it could not start applying to join the European Free Trade Association until it is independent… It came after the Telegraph disclosed that Ms Sturgeon is considering announcing that Scotland would instead try and sign up to EFTA, three members of which are outside the EU but get single market access in return for complying with rules set by Brussels… For Scotland to get access to the single market using this route, it would have to get the approval of the four EFTA members to join that organisation, then the 27 other EU member states, to join the EEA. – Daily Telegraph

Liam Fox sides against May over foreign student migrants

Theresa May rebuffed the international trade secretary yesterday after he suggested that foreign students should be excluded from the target to reduce net migration to the tens of thousands… Dr Fox said that he had raised the issue with Amber Rudd, the home secretary, and agreed with Boris Johnson, the foreign secretary, and Philip Hammond, the chancellor, who are on the other side of the debate from the prime minister. Mrs May’s spokesman said that she would not relent to pressure to remove students from the immigration target… The international trade secretary told peers on the Lords international relations committee that he sympathised with the views of his colleagues. “It’s an ongoing argument inside government and I’ve made my views on that clear in private to the home secretary,” he said. – The Times (£)

  • Brexit won’t mean ‘cliff-edge’ shift in migration policy, minister says – The Guardian

UK unemployment falls to joint-lowest level in more than 40 years

Unemployment fell to its joint lowest level since 1975 as companies kept on hiring in the three months to January, adding to evidence that the economy is performing strongly. Joblessness dropped to 4.7pc, down from 4.8pc a month earlier and from 5.1pc in January 2016, according to the Office for National Statistics. The last time unemployment was this low was a period of strong economic growth in 2004 and 2005, and joblessness has not been lower since the mid-1970s. Employment rose to a new record high of 31.85m with an extra 92,000 jobs created over the three-month period, while unemployment fell by another 32,000 to 1.58m. The quality of jobs is improving too, as more workers gain full-time employment. – Daily Telegraph

Dutch election: PM Mark Rutte ‘wins most seats as Geert Wilders equal second’

Dutch Prime Minister Mark Rutte has won the country’s election, holding off a strong challenge from far-right leader Geert Wilders. Mr Rutte’s centre-right VVD party is thought to have taken 32 of the 150 parliamentary seats, 12 more than Mr Wilders’ anti-Islam, anti-immigrant PVV party who is trailing in third… There was a high turnout where voters had 28 parties to choose from. Coalition talks are now expected to last weeks or possibly months. – Sky News

  • How to lose but win: 5 takeaways from the Dutch election – Naomi O’Leary for Politico

Daniel Hannan MEP: Brussels, not May, is being inflexible

The Prime Minister’s attitude to the rest of the EU is co-operative and friendly. She misses no opportunity to say that Britain will be the EU’s closest ally… If you’re looking for a truly doctrinaire position, look across the Channel. EU leaders have agreed a line, which they keep repeating, to the effect that the UK must not be better off in future than it is now. That’s a doubly revealing stance. First, it suggests that, other things being equal, leaving the EU will make a country better off – except in so far as Brussels deliberately seeks to damage it. Second, it shows that the EU isn’t really about the prosperity of its members. After all, why shouldn’t the other 27 states, as well as Britain, aim to get a better deal than they have now? – Daniel Hannan MEP for ConservativeHome

Matthew Lynn: We’re more likely to get a better Brexit if we don’t ask

Paradoxically, the less we ask for from the EU, and the closer we get to walking away from the table empty-handed, the more we are likely to get a good deal in the end… Imagine our negotiators sit down at the table, and start detailing a whole list of stuff that we want from the EU… They will no doubt listen respectfully, and then start coming up with a list of things they want in return… Then imagine a different scenario. Our negotiators sit down and say, actually there is nothing we want from the EU. We are happy to operate under World Trade Organisation rules, we will make sure our market is completely open to European companies, and we have no plans to impose any tariffs of any sort. And, er, that’s it. The Brits then start looking at their watches, and asking if the team on the other side of the table knows anywhere good for lunch. At that point, the EU side will have to start thinking about all the things they want from Britain. – Matthew Lynn for the Daily Telegraph (£)

Graeme Leach: The idea that London will be replaced as Europe’s financial centre is completely potty

The simple response to this claim is to say: get on a plane, fly to Frankfurt, walk around the financial centre, and then decide whether you think the city has the breadth and depth of financial services to compete with London. The “agglomeration economies” in London make it the world’s financial centre. What about Paris? Same problem. And how are you going to move vast numbers of highly paid individuals to countries with significantly higher marginal tax rates? It’s not going to happen. Period. London is Europe’s financial centre, and at a time when Europe’s banks are in a parlous condition, with shattered balance sheets, access to deep capital markets is a must for European companies. – Graeme Leach for City A.M.

  • Legal eagles urge the government to seek a bespoke Brexit agreement for the City – City A.M.
  • Davis says EU attitude on Brexit deal for UK banks ‘warming’ – Bloomberg
  • Ireland complains about “dangerous competition” tactics being used by rival European cities to woo business from London – The Guardian

Iain Martin: The Bank of England needs a reboot to cope with Brexit

Male or female, what really matters is that the next governor approaches Brexit with the right attitude. Mr Carney’s doom-laden warnings about the consequences of leaving the EU, which became an important part of Project Fear during the referendum campaign, have cast a shadow over his remaining years in office. Mr Carney has since recanted, but his successor must be able to set a confident pro-Brexit course into the 2020s and grapple with monetary policy in an economy that will probably have higher inflation, not to mention a continuing squeeze on wages. – Iain Martin for The Times (£)

Anne McElvoy: Europeans mock Brexit but they have their own issues to deal with

The response to Brexit is an insight into two different aspects of the European relationship with Britain. The first is a tendency to take us seriously but not literally. One of the problems David Cameron encountered in offering any sort of renegotiation worth its salt was that Paris, Berlin and Brussels did not really believe Brexit could happen, and thus pulled little out of the bag to help fend it off. If Brits have made a historic mistake, then so have EU leaders. The rhetoric of “you crazy Brits” disguises the fact that a rigidly institutional EU ended up unable to produce what John Major sought in vain two decades ago — the elusive “variable geometry” of European association and co-operation, able to accommodate differences as well as unity. – Anne McElvoy for the Evening Standard

Brexit comment in brief

  • The Brexit Power Matrix – Ryan Heath for Politico
  • Europe’s fight to prove union has staying power after Brexit – Philip Stephens for the FT (£)
  • For all its threats and bluster the EU is itself doomed – Leo McKinstry for the Daily Express
  • Remember when the idea of leaving the EU was laughed at? – Stephen Pollard for the Daily Express
  • Time to see the UK’s strengths – steady pound since 2012 – John Redwood’s Diary
  • Brexitland: Pessimism is toxic in Britain’s coastal towns. But decline isn’t inevitable – Owen Jones for The Guardian
  • The Government must go to the ECJ to establish whether Article 50 notice is revocable – Mohammed Amin for ConservativeHome
  • Fintechs have a solution post-Brexit – now we must embrace the uncertainty – Cameron Stevens for City A.M.
  • Yes, it’s Gove v Portes in a brutal Brexit rematch – but where’s the blood? – Andrew Gimson for ConservativeHome

Brexit news in brief

  • UK’s corporate tax allure outweighs Brexit concerns, CEO says – Bloomberg
  • Germany to press G20 on free trade in potential challenge to Trump – Reuters
  • What Merkel wants from Trump – Matthew Karnitschnig for Politico
  • UK’s former EU commissioner Lord Hill says businesses should be able to contribute more to Brexit plans – City A.M.
  • ‘Clerical error’ blamed after Government accidentally gives Lord Heseltine job back – PoliticsHome