Brexit News for Monday 12 June

Brexit News for Monday 12 June
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Brexiteer Michael Gove makes return to Cabinet in Theresa May’s post-election reshuffle

Michael Gove made a dramatic return to Cabinet today after he was made Environment Secretary in Theresa May’s post-election reshuffle. In a shake-up that saw few major changes, the Prime Minister also promoted Damian Green to her effective second in command and demoted Liz Truss from the justice brief. Mrs May is trying to shore up support after the Conservatives’ humiliating result in the snap general election on Thursday, when they lost 12 seats and their Commons majority. – PoliticsHome

  • Damian Green promoted in Theresa May’s reshuffle in hint her Brexit stance will be softened – PoliticsHome
  • Michael Gove ‘surprised’ to re-join Cabinet – Telegraph
  • Theresa May’s Cabinet reshuffle in full – Michael Gove returns to the fold – The Spectator

Labour rules out trying to keep Britain in EU single market

John McDonnell said this morning that the option of remaining members of the trading area would not be on the negotiating table in talks with Brussels and his party would not rethink its stance. Labour went into the general election campaign calling for the maximum possible access to the single market after Brexit, while accepting that free movement would end and Britain would no longer be members. – PoliticsHome

> Watch on BrexitCentral’s YouTube channel: John McDonnell tells Robert Peston that Single Market membership is incompatible with the Brexit vote

Fresh Tory civil war erupts over Brexit as Remainers seek to exploit Theresa May’s weakened position to push pro-EU agenda…

A fresh Tory civil war erupted over a Remainers’ bid to soften the Government’s Brexit demands when talks start in just seven days’ time. Pro-EU figures led by Chancellor Philip Hammond mounted a huge push to water down Theresa May’s blueprint for exiting the EU as soon as the scale of her election disaster become clear on Friday morning. – The Sun

Some Conservative Cabinet ministers are privately lobbying Theresa May to alter her Brexit plan from an “ideologically driven” approach to a “pragmatic Brexit”. The new approach would have “fewer things being ruled out” after the Prime Minister’s failure to secure an increased mandate at the General Election. – Sky News

  • May’s ministers plot softer Brexit to keep UK in single market – Bloomberg

…as European politicians hope for ‘softer’ Brexit following the election result

European politicians are hoping that the UK’s General Election result will lead to a softer Brexit. As the result became clear on Friday, EU leaders were quick to express the urgency of the upcoming Brexit negotiations. European Council president Donald Tusk tweeted that there was “no time to lose”. – City A.M.

  • Lord Heseltine: “Brexit is the cancer gnawing away at the heart of the Tory Party” – Channel Four News
  • Ireland’s EU commissioner sees ‘softer’ Brexit after UK poll – Reuters
  • SNP say Theresa May’s Brexit policies ‘must be scrapped’ – BBC News
  • George Osborne: No ‘hard Brexit’ – Politico
  • Voters have had enough of being bit-players in the Tories’ psycho drama on Europe – Nick Clegg for the FT (£)
  • David Davis: UK will leave single market, 100% support for Theresa May – FT (£)

Brussels doubts Theresa May can stick to Brexit timetable

EU officials doubt Britain will be in a position to begin Brexit talks on June 19 as previously scheduled after Prime Minister Theresa May lost her majority in British parliament in Thursday’s general election. While official-level communication between London and Brussels remains open, senior EU officials said negotiators don’t expect to get down to substantial political-level talks until the government in Westminster is more secure. – Politico

Theresa May was reportedly urged to call the general election by Jean-Claude Juncker

Theresa May was urged to call the general election by Jean-Claude Juncker, it has been reported. The President of the European Commission apparently advised Ms May to call the election saying her 17-seat majority would not be enough during Brexit negotiations. Mr Juncker allegedly said having a larger majority would help Ms May during “pinch points”, such as determining the UK’s divorce bill. – Independent

City senses a ‘softer Brexit’ after Theresa May’s election flop

City bosses are set to push for a softer Brexit after Prime Minister Theresa May failed to win a majority in last week’s General Election. “The chances of the City’s asks being listened to during the Brexit negotiations increase now,” a senior City source said yesterday. “Aspects like mutual access, a workable transitional agreement and access to international talent could be easier to achieve as a result.” – City A.M.

British business has regained its voice after the election, calling for a softer approach to Brexit, preferably retaining membership of the single market and the European customs union. The new willingness to speak out, after an election in which companies generally kept their heads down, comes as a survey conducted after the election showed a dramatic plunge in business confidence on fears of heightened political uncertainty. – FT (£)

Economists urge May to accelerate Brexit plans

Theresa May must start Brexit talks as soon as possible and prove she is making progress with the EU if she wants to restore confidence among British businesses, economists warn. Investment could tumble following the general election as companies hold back on major spending plans at a time of intense uncertainty, while poorly thought-through schemes to intervene in businesses risk a “chilling effect” on the economy. – Telegraph

Macron’s party set for big majority after parliamentary vote in France

President Emmanuel Macron’s centrist party is on course to win a massive majority after the first round of France’s parliamentary election, which also confirmed the collapse of traditional parties. – Politico

Global businesses at EY World Entrepreneur of Year awards still interested in investing in Britain

The saying that uncertainty is bad for business did not seem to ring true with all of the international business owners involved in the EY World Entrepreneur of the Year competition on Saturday. Many of the global companies that have interests in the UK appeared unfazed by the prospect of Brexit and even by the confusion generated by Thursday’s general election. – Times (£)

Wolfgang Munchau: Do not exaggerate the effect the election will have on Brexit

If Brexit cannot technically be reversed, can it be materially altered or softened? I do not see how this is possible, either, except through a longer transition period. Mrs May’s letter triggering Article 50 laid down two clear conditions: no membership of the customs union and no membership of the single market. What very few Remainers in the UK seem to realise is that the EU favours a Brexit with no single market and customs union membership, because it makes a difficult negotiating process easier. The degrees of hardness and softness are not unilateral choices to be taken by the UK electorate. – Wolfgang Munchau for the FT (£)

Roger Bootle: Germany faces an uncertain future as the eurozone’s magic money tree

The EU has had a good few weeks, starting with the election of Emmanuel Macron as President of France, backed up by a series of strong economic figures from just about everywhere in Europe, and culminating in the Remainers’ Revenge last Thursday in the UK. Given the UK’s profound political uncertainty, it is now even possible that Brexit will not happen at all. Yet the EU is facing a potentially bigger challenge. – Roger Bootle for the Telegraph

The Sun: Unless the Tories want Jeremy Corbyn in Number 10 they need to stop plotting now

If the Tories want to avoid turning a catastrophe for the party into a nightmare for the country, they need to stop plotting. Now. All weekend there have been whispered conversations and briefings about potential successors to Theresa May. – The Sun says

Boris Johnson MP: To all of you urging Theresa May to quit and suggesting we need another election I say, get a grip

But at the risk of stating the obvious, Jeremy Corbyn Did Not Win This Election. He didn’t even come close. Yes, he picked up Kensington – but then he also lost Mansfield. For all his ludicrous boasting, Mr Corbyn does not have the numbers to form a government, even if he could get the Liberals and the Scottish Nationalists to serve under him. He has about as many MPs as Gordon Brown when he was defeated in 2010. – Boris Johnson MP for The Sun

Philip Stevens: Philip Hammond is the politician to salvage a Brexit deal

Mr Hammond’s position is strengthened further by the fact that most of the serious work on Brexit has been done by the Treasury. Mr Johnson may think a favourable deal is guaranteed by Britain’s imports of Italian prosecco and German cars. The Treasury has examined in detail ways Britain can keep open trade and investment channels in a new arrangement with the EU. It has also made the case for a sensible immigration policy. “Spreadsheet Phil”, as the chancellor is sometimes known in Whitehall, has the experience and temperament for complicated negotiations. – Philip Stevens for the FT (£)

Anand Menon: What now for Brexit in light of the general election results?

The prime minister may see it as in her own interest to manufacture a collapse in the talks to avoid the possibility of defeat in the House. In this sense, at least, the election makes a chaotic Brexit more likely. Finally, the election may change the dynamics of government in the country. The prime minister’s insistence on a hard Brexit revealed her willingness to sacrifice economics to political considerations. Reports from meetings between ministers and business representatives regularly stressed the stubborn refusal of the former to compromise on the prime minister’s Brexit vision. – Anand Menon for The Times (£)

Matt Ridley: Ten reasons to be cheerful amid the gloom

For those of us who want a clean Brexit and who champion freedom and innovation rather than socialism, the election result was a shattering disappointment. It reduced the party that most embraces free enterprise to a minority in the House of Commons and leaves us with a diminished and humiliated government less likely to win crucial concessions from a European Union emboldened to be more punitive — all against a background of teenager-murdering theocracy. But, as the first shock fades, I am finding a few crumbs of comfort. Not optimism exactly, but glimmers of light amid the gloom. – Matt Ridley for The Times (£)

Juliet Samuel: Voters have disarmed our Brexit negotiators – we’ll get a worse deal

Let me explain. Negotiations with the EU were always going to be difficult and nasty. I was cautiously optimistic, however, that shared interests and mutual reasonableness would eventually result in a workable deal, delivering Brexit without a crippling economic cost. This option is now gone for the foreseeable future. The reason that is that implementing it requires passing a series of enormous, controversial Bills through Parliament, covering everything from immigration to fisheries. There is little chance that Theresa May, or any Conservative Prime Minister, can steer any such legislation through both Houses. From the most pious of peers to the pro-Remain Scottish Tories, our new Parliament heavily favours the softest of soft-boiled Brexits. The Government will not get the support it needs to implement anything else. – Juliet Samuel for the Telegraph

Brexit in brief

  • After the General Election result, business has a chance to shape the Brexit debate – Christian May for City A.M.
  • A hung parliament will save SMEs from the anti-business red tape in the Tory manifesto – Emma Jones for City A.M.
  • The future is bleak for British politics – Oliver Kamm for CapX
  • Loophole in EU law means veal calves face 100‑hour journeys to Spain – The Times (£)
  • Britons will save £1.4bn as phone roaming charges are axed in EU – The Times (£)