Sajid Javid doubles down on divergence from EU rules in Brussels: Brexit News for Wednesday 22 January

Sajid Javid doubles down on divergence from EU rules in Brussels: Brexit News for Wednesday 22 January

Sajid Javid doubles down on post-Brexit divergence from EU rules in Brussels

Sajid Javid doubled down on warnings that Britain will diverge from European Union rules after Brexit as he arrived at a meeting of EU finance ministers in Brussels. The Chancellor insisted the country will not agree to follow the bloc’s rules in exchange for better access to its markets, in a fresh blow to businesses hoping for a close trading partnership. European Commission chiefs are seeking to tie Britain into “level playing field guarantees” on state aid, tax, social standards and the environment as part of the post-Brexit trade deal. Brussels is anxious to prevent the UK from undercutting EU standards to gain a competitive advantage over the bloc. It insists the guarantees are the price of the no-tariff, no quota free trade deal in goods. – Telegraph (£)

EU reportedly preparing to give the UK worse trade deal terms than Canada or Japan…

The European Union is preparing to offer the UK a trade deal on tougher terms than its deals with Canada, Japan and a host of other leading trade partners, the Telegraph has learned. In what will be seen by industry as an unusually harsh move, the European Commission has warned EU member states that it would be a mistake to allow some UK industry bodies to be allowed to certify that goods conform to EU standards. The so-called Mutual Recognition Agreements (MRAs) are granted to other key EU trade partners to facilitate the smooth movement of goods in key sectors, but could be withheld from the UK if it only seeks a basic trade deal.  The uncompromising European Commission stance surprised even some EU members states when they met on January 10 to discuss future goods trade with the UK, according to an account of the meeting obtained by The Telegraph. Two senior EU sources separately confirmed the European Commission’s approach, which risks hitting the medicine and car industries hardest. “We will not blindly delegate the recognition of EU standards. Companies have had plenty of notice about how to get certified in the EU,” explained an EU official familiar with the discussion. – Telegraph (£)

…as Brussels says it needs the power to fine the UK if it breaks rules laid out in any trade deal

Any British trade deal with the EU after Brexit should include powers to fine the UK if it breaks European rules, Brussels has said. Commission officials told member state diplomats that breaches of the agreement would be punishable with a “lump sum” or “penalty payment”, payable to Brussels within one month. The plan is the latest to come out of a series of meetings in the EU capital aimed at getting member states and the Commission on the same page before talks start next month. The EU is planning to officially draw up its negotiating terms over the next few weeks. In a further stipulation likely to enrage Brexiteers, the EU also wants its own European Court of Justice (ECJ) to have a starring role in arbitrating the deal. Brexiteers view the ECJ as a “foreign court” and many hard-liners believe Britain should not be under its jurisdiction after it leaves. – Independent

Donald Trump opens the door to a ‘tremendous’ UK trade deal…

President Donald Trump delivered a defiant defence of his record while his powerful entourage had a sobering message for the absent British government in Davos: the UK will face retaliatory trade sanctions if it persists with plans for a digital tax on the US tech giants. Steve Mnuchin, the US Treasury secretary, had barely set foot on Swiss soil before hurling his throw-away bombshell. The British and Italians must suspend their plans for this contentious levy or face the full wrath of the Trump White House. “If not, they’ll find themselves faced with President Trump’s tariffs,” he said on the margins of the World Economic Forum. A comprehensive trade deal between the two countries after Brexit will be effectively impossible in such circumstances. Mr Trump was more oblique in his triumphant address to the Davos fraternity. “We look forward to negotiating a tremendous new deal with the United Kingdom: they have a wonderful new PM who wants very much to make a deal,” he said. – Telegraph (£)

…although his Treasury Secretary threatens the UK with tariffs if Boris Johnson imposes taxes on tech giants

Steven Mnuchin, the US treasury secretary, has threatened the UK with tariffs if Boris Johnson presses ahead with plans for a new tax on American tech giants. The threat escalates an ongoing row between Mr Johnson and Donald Trump just weeks before London hopes to open talks on a post-Brexit free trade deal with the US. It comes after Emmanuel Macron, the French president, backed down at the weekend on plans for a levy of up to 3 per cent of revenue in a bid to resolve the issue of global technology companies paying little tax in countries where they earn large amounts but are not physically present. In a phone call with Mr Trump on Sunday, Mr Macron agreed to extend negotiations until the end of this year, averting threatened US duties of up to 100 per cent on about £2bn worth of imports of totemic French products such as champagne and camembert cheese. Now Mr Mnuchin has warned that UK exporters can expect similar treatment if Johnson persists with the digital services tax, which Washington believes unfairly penalises firms like Google, Amazon and Facebook. – Independent

MPs to consider Lords amendments to the Brexit deal after peers inflict further defeats on the Government

MPs will consider amendments to the Prime Minister’s Brexit deal after the Government was defeated five times by defiant peers. The House of Lords backed two more amendments to the European Union (Withdrawal Agreement) Bill – or WAB – in a mauling for ministers on Tuesday. It followed three defeats on Monday on the rights of EU workers legally residing in the UK to have physical proof of their right to remain and the power of courts to depart from European Court of Justice rulings. In the latest reverses, the Government was heavily defeated as peers backed a move to ensure the rights of unaccompanied child refugees to be reunited with their families in the UK post-Brexit. Voting was 300 to 220, majority 80, in a fourth defeat for the Prime Minister in just 24 hours. Later, the Government suffered a fifth as peers narrowly backed a move underlining the commitment to the so-called Sewel Convention, which states that the UK Parliament “will not normally” legislate for devolved matters without the consent of the devolved legislature affected. Voting on this Opposition-led amendment was 239 to 235, majority four. With Brexit day looming on January 31, the Bill, which was passed with large majorities by MPs earlier this month, will have to return to the Commons for further scrutiny on Wednesday. – ITV News

Royal Mail set to release stamps to mark Brexit after Boris Johnson stepped in and made request

Britain is set to get a special set of stamps to mark Brexit, The Sun can reveal. PM Boris Johnson has stepped in to make the formal request from the Royal Mail. It is understood that ministers are now in talks with post bosses, which one government insider dubbed as “very positive”. An announcement could come as early as tomorrow, in what would be a major victory for a long-running Sun campaign for the stamps. Our call for special commemorative stamps to remember the landmark event in the nation’s history was first made two years ago, and was picked up by leading Brexiteers. But the Royal Mail has always opposed the move until now, insisting that issuing Brexit stamps would breach its “strict political neutrality”. Under the fledgling plan under discussion, a book of four stamps would be issued, each with a different design. They would be ready to go on sale in January 2021, to mark the end of the 11 month-long Brexit transition period when Britain will no longer be subject to EU rules. – The Sun

Welsh Assembly joins Holyrood and Stormont in signalling opposition to Johnson’s Brexit deal

The Welsh Assembly has joined the Scottish Parliament and the Northern Ireland Assembly in rejecting the Brexit bill. It means all of the UK’s devolved law-making bodies have voted against the withdrawal agreement legislation. A total of 35 assembly members, from Labour and Plaid Cymru, opposed the law, while 15 backed it. First Minister Mark Drakeford said the law unilaterally rewrites the way devolution works in Wales. His counterpart in Scotland, Nicola Sturgeon, said the three votes were “unprecedented and momentous”. Brexit Secretary Stephen Barclay had appealed to Welsh ministers not to vote the bill down, saying it respected the result of the 2016 referendum when Wales voted to leave. The legislation is currently passing through the UK Parliament – the government lost three votes in the House of Lords on the legislation on Tuesday. Normally the devolved assemblies and parliaments must give their permission before Westminster can legislate on issues that impact them. Consent has not been given by any of the three bodies, although the moves are not legally binding and will not stop the UK government pressing ahead. – BBC News

Theresa May’s £30,000 salary cap on migrants to be replaced by Australian-style points system

Theresa May’s £30,000 salary cap on migrants is to be scrapped to meet demand for skilled workers into Britain after Brexit, under proposals to be published next week. The earnings threshold was a centrepiece of Mrs May’s attempts to control migration but the Cabinet decided yesterday that the policy will be scrapped as it will not fit with Boris Johnson’s plans for an Australian-style points immigration system. It will be replaced with what Downing Street sources described as a more “nuanced” system following complaints from universities and business that the current £30,000 cap is too crude. They say it prevents them recruiting skilled migrant workers such as lab technicians and engineers who earn less than the threshold from coming to the UK from January next year not only from the EU but also the rest of the world. The campaign group Migration Watch  reflected the concerns of some ministers by warning that abolishing the cap could lead to further rises in migration. – Telegraph (£)

Fine Gael vows it will only vote for an EU-UK trade deal that protects Irish farmers

Fine Gael has pledged it will only vote for an EU trade agreement that ensures a level playing field for farmers, if they are re-elected. The party has promised to protect farmers in its election manifesto, pledging to safeguard farm incomes against Brexit if re-elected. It has promised to “negotiate a strong Common Agricultural Policy (CAP) budget with a particular emphasis on supporting younger farmers”. Speaking at Fermoy Mart in Co Cork on Tuesday, Deputy Irish Taoiseach Simon Coveney said the party is committed to protecting Irish agriculture in the next phase of Brexit. He said: “We have until the end of the year to put a trade agreement in place with the United Kingdom. I was with Michel Barnier yesterday and we spent a lot of time talking about farming and fishing. He’s somebody who understands this brief, only too well. “If we do not succeed in getting a good trade deal in place, then the five billion euros of food that we sell to the UK each year becomes a trade that that will be put under threat or if we can’t get a seamless trade deal that doesn’t have any tariffs and doesn’t have any quotas attached to it.” – Belfast Telegraph

Andrew Rosindell: Brexit is the perfect opportunity to lead the world in animal welfare standards

Britain’s long awaited exit from the European Union has finally been secured. After three long years, we are at last reclaiming our island nation’s destiny and taking back control of our laws, borders and institutions. We can start doing things our way once again! Animal welfare is a typical example of where regulations in Brussels have held us back for too long. As I said in my question to the Prime Minister last Wednesday, Britain is a nation of animal lovers, and Brexit presents the perfect opportunity for us to lead the world in animal welfare. We must decouple ourselves from the EU’s lesser standards on animal welfare. It is intolerable that every year in this great country, thousands of cattle and other livestock are jammed together in tight, cramped spaces before being sent overseas for slaughter, often as far away as North Africa. Membership of the European single market has meant that British governments have been unable to end this barbaric and backwards practice of live exports. Tougher sentences for those convicted of animal cruelty, new laws on animal sentience and a crackdown on the keeping of primates as pets are all policies that will put us at the forefront of the fight against animal cruelty. I am proud that our government has already pledged that it will be taking action on all these things, making our animal welfare regulations stronger than they were inside the European Union. As Britain becomes a truly global nation once again, we must not let this progress slip. Our government must continue to up our standards on animal welfare to ensure that we become the global leaders on this issue. If we get this right, it will not only be the British people that feel the benefits of Brexit, but so will our animals! – Andrew Rosindell MP for PoliticsHome

Lloyd Evans: Why John Bercow blames Jo Swinson for thwarting the plot to stop Brexit

The ex-Speaker is enjoying the limelight, of course, but he isn’t necessarily cashing in. Last Friday, he did a solo gig at a community centre in Holland Park where his appearance raised thousands of pounds for a local charity… On the subject of Brexit, he said that Remain’s best opportunity came and went last October. ‘A short-term coalition government to administer and deliver a People’s Vote might have been formed,’ he said. He had no doubt who sabotaged this possibility: ‘Jo Swinson wasn’t prepared to allow Jeremy Corbyn to be temporary prime minister. But the fear that this would lead to years and years of Corbyn and John McDonnell is for the birds.’ He also blamed Boris’s landslide on the former Lib Dem leader. ‘Jo Swinson saw some evidence that she might win 60, 80 or 100 seats, and [there would be] every chance of a coalition government.’ This turned out to be a ‘mirage’ because, as Bercow put it simply, ‘Boris held his nerve.’ – Lloyd Evans for The Spectator

Tom McTague: Britain could be Canada

In the scramble to find a model for its post-Brexit relationship with the European Union, Britain has considered a series of options: the Norway model, the closest of all trading relationships available absent actual membership of the bloc; the Swiss model, more complicated but with more sovereignty; and the Canada model, the loosest of all. But perhaps this has been the entirely wrong way of looking at the challenge. For too long, Brexit has been viewed as an end in itself, not a beginning. At the root of much of the back-and-forth between Brexiteers and Remainers has been the fallacy that whichever model is chosen, that will be the end of the matter—that the politics of Britain’s relationship with its continental neighbors will come to an end, the new state of affairs locked in from then on. For most countries, this is not how international relations works. Diplomatic and economic relationships change and adapt over time. The models Britain should be contemplating, then, are not one country or another’s current trade agreements with the EU, but successful countries in themselves—countries, specifically, that have thrived in similar circumstances to those that Britain will face outside the EU. – Tom McTague for The Atlantic

Telegraph: The strength of the British economy is defying predictions of post-Brexit doom

Britain’s jobs miracle continues to astound. Anyone old enough to remember the recession of the early 1980s, when the numbers out of work rose above 3 million and unemployment became the dominant political issue, can only wonder at current trends. Every quarter brings a new record. Despite sluggish economic growth, more than 200,000 new jobs were generated in the three months to November. Nor is this, as Labour used to claim, the result of zero hours contracts or part-time employment. Most of the new jobs are full-time, with a record number of women in the workforce pushing the employment rate to a new high of 76.3 per cent, though this increase is in part due to the change in women’s retirement age. In addition, wages are rising at twice the rate of inflation, making people better off and boosting consumer spending. Those calling on the Bank of England to cut interest rates at its next meeting should consider the wisdom of that approach. The average worker is still not earning as much in real terms as they were in 2008 before the crash. But none the less, on the eve of Brexit, the economic news is pretty good, even exceptionally so given the predictions of impending doom. – Telegraph (£) editorial

Jake Pugh: The EU hasn’t twigged yet – we don’t want alignment, we want to break free

Last week, the Chancellor gave an interview in which he explained that the UK would diverge from EU rules and regulations: “There will not be alignment, we will not be a ruletaker, we will not be in the single market and we will not be in the customs union…” This clear position statement has led to predictable howls of anguish and coordinated responses from the usual suspects: Michel Barnier, Phil Hogan and Ursula Von der Leyen. Beside being predictable, these responses betray a misunderstanding within the EU regarding the UK negotiating position and commitment not to extend Transition beyond 2020. In fact, the UK position to diverge is wholly logical and consistent. Firstly, because all parties know that a Free Trade Agreement (FTA) across all sectors as outlined in the Political Declaration is evidentially not achievable in the time available. Secondly, the EU has known since last August that this was clearly the direction of travel for the UK. So the ‘faux’ surprise around regulatory divergence exhibited by the (unelected) EU leaders is nothing more than crocodile tears. – Jake Pugh MEP for the Telegraph (£)

Brexit in Brief

  • SNP MP brutally shut down by Andrea Leadsom over ‘Brexit sinking ship’ pessimism – Express
  • Brexit Party MEP Alexandra Phillips rips into ‘revolting’ EU – Express