Theresa May again faces possible Cabinet resignations as her customs union backstop 'has no time limit': Brexit News for Friday 12th October

Theresa May again faces possible Cabinet resignations as her customs union backstop 'has no time limit': Brexit News for Friday 12th October

Theresa May again faces possible Cabinet resignations over customs union backstop that ‘has no time limit’…

Theresa May is facing the threat of Cabinet resignations after she accepted EU demands that there will be no time limit on her controversial Brexit backstop plan. The Prime Minister told her Brexit “war Cabinet” on Thursday afternoon that a proposal to keep Britain in a customs union with the EU until a trade deal can be agreed will have no end date, leading to fears the arrangement could become permanent. At least three eurosceptic Cabinet ministers are said to be considering quitting over the latest concession, which appears to contradict Mrs May’s promise earlier this year that the backstop would expire “at the very latest by the end of December 2021”. Penny Mordaunt, the International Development Secretary, and Esther McVey, the Work and Pensions Secretary, have both refused to endorse the Prime Minister’s Chequers plan. Andrea Leadsom, the Leader of the Commons, is also understood to have significant concerns. – Telegraph (£)

  • Theresa May warned of ministerial revolt over Irish backstop – The Times (£)
  • Cabinet unease over open-ended customs union – Laura Kuenssberg for BBC News

> Patrick O’Flynn MEP on BrexitCentral this morning: If the Tories press on with an epic betrayal of the British public, they should expect an epic punishment

…although she reportedly told ministers last night that a deal was close  

Theresa May briefed her inner cabinet on Thursday evening that a historic Brexit deal is close, as Downing Street faced a backlash from Tory Eurosceptics who fear it could leave Britain locked in a customs union with the EU for ever. The British prime minister convened her closest colleagues to discuss the outline of an EU withdrawal treaty that could threaten the survival of her government, with Democratic Unionist MPs — who prop up her minority government — threatening to vote it down. – FT (£)

DUP Brexit spokesman suggests Tories may have to depose May to ‘heal wounds’…

The Conservatives may have to change leader to “heal wounds” and ensure its confidence and supply agreement “stays in place”, a top DUP MP has told Sky News. Sammy Wilson, the DUP’s Brexit spokesperson, issued a stern warning to the Conservatives as he pressed Mrs May to change her course on Brexit. He suggested all 10 DUP MPs could vote down this month’s budget to “pull the government back into keeping its promises”. Asked if that would be under a different leader, Mr Wilson told Sky News: “That may lead to a different leader. But that’s not a question for us, we’re not members of the Conservative Party. That’s up to the Conservative Party to decide whether there is someone else who can heal those wounds and take the party in a different direction, which would ensure that the agreement could stay in place.” – Sky News

  • Theresa May prepared to pay millions to ensure DUP support her Brexit plans – The Sun

> David Scullion today on BrexitCentral: If ‘pragmatism’ was the right approach Theresa May would be reigning supreme

…while another DUP colleague raises the prospect of forcing an election

Northern Ireland’s Democratic Unionist party has upped the ante in the UK’s Brexit negotiations by saying it was “not afraid” of a general election, despite the risk of bringing Labour’s Jeremy Corbyn to power. Jim Shannon, a DUP MP, said the hardline unionist party would decide in the next two weeks whether it would support Theresa May’s Brexit stance, and urged her government to take a “hard look” at its concerns. “Everything’s on the table. We’re not afraid of elections — we never have been in the DUP,” said Mr Shannon. MPs of all the main parties have been left wondering whether the DUP, known for its brinkmanship, was bluffing on its stated willingness to vote against Mrs May. She relies on the party for her majority in parliament and could be forced into a general election if she lost its support. – FT (£)

Cabinet Minister Esther McVey won’t say if she backs Chequers in TV interview

Esther McVey has declined to back Theresa May’s Brexit plans, saying she did not want to add to “speculation”. The work and pensions secretary said she was “fully, 100% behind the prime minister” without endorsing her proposal for future trade with the EU. Cabinet ministers expressed concern about potential compromises with the EU at a meeting at No 10 on Thursday. The BBC understands concerns centred around plans to ensure no hard border between Ireland and Northern Ireland. The UK and the EU both want to avoid a “hard border” – physical checks or infrastructure between Northern Ireland and Ireland – but cannot agree how. – BBC News

  • Esther McVey refuses to back Theresa May’s Brexit plan ahead of crunch cabinet talks on EU deal – Independent

Brussels blames Michel Barnier’s interpreters for raising false hopes of Brexit deal

Brussels has moved to dampen down expectations that a Brexit deal could soon be finalised, blaming Michel Barnier’s interpreters for inaccurately saying an agreement was “within reach” as early as next week. European Commission sources blamed the inaccurate interpretation, which caused the pound to surge, although observers noted that Mr Barnier had garbled his words somewhat. The EU’s chief Brexit negotiator was speaking in French to a conference of business leaders at the European Parliament on Wednesday, as speculation in London mounted that Theresa May had decided on a UK offer over the Irish border backstop. Stefaan De Rynck, a senior aide to Mr Barnier, tweeted that his boss had said that the negotiations were being conducted with the objective of the agreement being within reach at the time of next week’s EU summit. – Telegraph (£)

Theresa May has to make more concessions to Brussels before they will give a Brexit deal, EU finance chief demands

Brussels’ budget chief has shattered the fragile truce over Brexit by demanding Theresa May makes more concessions to land a trade deal. Gunther Oettinger called on the PM to “lead” and defy hard Brexiteers in her party in a series of unguarded remarks. He also described solving the Irish border as “mission impossible” just as British and European negotiators looked poised to seize a breakthrough. Mr Oettinger, who is a close ally Angela Merkel, made the remarks during a speech in Brussels this week. He said: “The most important thing was that Mrs May — with or without dances — left her party conference strengthened, er, she survived. She must now use the momentum. She must now lead and be prepared to make further concessions to us, no matter what Boris Johnson thinks or says.” The gaffe-prone German official blundered into the talks at a delicate time, with officials having entered a period of radio silence dubbed “the tunnel”. – The Sun

  • PM’s compromises a ‘concern’ for cabinet ministers – BBC News

Chris Grayling gives ‘categorical assurance’ planes will not be grounded after Brexit

British Transport Secretary Chris Grayling has given Parliament a “categorical assurance” that planes will not be grounded post-Brexit. The statement came despite warnings from Whitehall two weeks ago that passengers could face flight disruption in the event of a no-deal Brexit, and similar warnings from the Irish aviation chief. Labour MP Lilian Greenwood, former shadow transport secretary, accused Mr Grayling of “mishandling” the issue, since his first assurances in 2016 that planes would not be grounded. The MP for Nottingham South said: “A year later there was no evidence of progress and he assured us there was no danger of planes being grounded by a no-deal Brexit. “Another year on and it’s clear from the government’s own technical notices that this is a real possibility. How can we reach any other conclusion than that this matter has been badly mishandled?” – Irish News

  • Brussels ‘could demand billions to keep planes in the sky in the event of a no-deal Brexit’ – The Sun

> WATCH on BrexitCentral’s YouTube channel: Chris Grayling gives “unequivocal assurance” that flights will continue after Brexit

Disorderly Brexit would hit economy hard, warns OBR

Prized post-Brexit trade agreements with the United States, China and India would have only a “relatively modest” impact on Britain’s economy, according to the government’s official forecaster. The Office for Budget Responsibility (OBR) said it may take “many years” for free trade agreements to generate significant benefits for the UK after it leaves the European Union. In addition, an “abrupt and disorderly” departure in the spring could have a “severe short-term impact” on the country’s economy and public finances, the independent fiscal watchdog warned, with higher prices and weaker growth. The OBR, an independent non-departmental public body, said it was “next to impossible” to predict the consequences of a no-deal Brexit. – The Times (£)

  • Crashing out of EU with No Deal Brexit ‘would bring worst economic crisis for 45 years’ says budget watchdog – The Sun

Mark Carney’s BoE forecasts in doubt with Brexit deadline drawing closer

The Bank of England’s Brexit assumptions are looking increasingly doubtful as the clock ticks down to the U.K.’s departure date. As officials work with Governor Mark Carney on new economic forecasts for November’s Inflation Report, Prime Minister Theresa May has yet to nail down an agreement in negotiations with the European Union. That’s left the BOE basing its outlook on a premise that will most likely need rewriting as soon as any deal, or lack thereof, is announced. In order to avoid making qualitative assessments on the state of the talks, the BOE’s forecasts are based off a Brexit with a smooth transition to an “average of a range of outcomes.” With that approach, the projections, presented as fan charts, reveal little about the balance of risks around the different ways Brexit might pan out. The BOE’s supervisory arm has stress-tested banks based on a worst-case scenario, but the inflation forecasts are predicated on a better result for the U.K. – Bloomberg

UK plan to use motorway as ‘parking lot’ if no Brexit deal

Work has begun to turn a motorway in south east England into a “parking lot” for lorries as part of a plan to prevent traffic chaos in the event of a no-deal Brexit, a senior MP said Thursday. The plan, which was not disclosed to local councillors or MPs until hours before work began on Wednesday, will see the M26 motorway closed overnight for more than a month in the run-up to Christmas while the roadworks take place. It marks a major escalation in government preparations for a no-deal Brexit, with talks in Brussels still deadlocked over the question of the Northern Ireland border, and MPs threatening to vote down Theresa May’s plan for the future trading relationship with the EU. Fears that a no-deal scenario would lead to major delays at the port of Dover for freight crossing the Channel, because of the need for customs and regulatory checks, have led the government to implement major works on motorways near the port in the county of Kent. Under the plan confirmed by Grayling on Thursday, the M26 motorway will become a holding area for hundreds of lorries to allow traffic to move more freely on other roads. – Politico

  • Kent motorway to shut as work begins on possible post-Brexit lorry park – Guardian

Owen Paterson: I’m an ex-Northern Ireland secretary. The border must not block Brexit

The prime minister may not have mentioned the Chequers agreement by name during her speech at the Conservative party conference, but her approach remains the same: securing “frictionless trade” with the European Union, at the incredibly high price of keeping the UK as a permanent rule-taker, unable to repeal or amend EU laws. Chequers, the proposal for a Brexit deal agreed within cabinet in July, states that the UK “should be consulted” as EU rules are changed. But a sovereign state merely being “consulted” on rules imposed upon it – which may be contrary to its best interests – is not taking back control. The prime minister’s justification for this is that it can maintain the “seamless border” between Northern Ireland and the Republic of Ireland, which “no simple free trade agreement could achieve … not even one that makes use of the very latest technology”. – Owen Paterson MP for the Guardian

Sammy Wilson: We are alarmed the UK is even prepared to discuss EU border demands

The EU strategy for dealing with the decision of the people of the UK to break free from the damaging embrace of Brussels rule, was clear from last December they made their demands about special arrangements for Northern Ireland. They have concocted an outrageous confidence trick on the UK government claiming that the Irish border presents an insurmountable problem to any trade between the UK and the EU after Britain leaves the EU. They argue that this can only be overcome by the UK staying in the European customs union and single market ie not leaving the EU at all, or Northern Ireland staying in the EU while the rest of the UK leaves. – Sammy Wilson MP for the News Letter

Mark Buckingham: Brussels stifles innovation — this is farmers’ chance to break free

It sounds like a dream scenario. A vital industry, booming around the world thanks to technology breakthroughs, which once supported scores of high-value research jobs and marked Britain out as a world leader. And which, thanks to Brexit, has potential to reach those heights again. When it comes to agricultural biotechnology, that’s no mere fantasy. Brexit really has created a rare opportunity for a sector that offers huge potential for farmers, food security and the environment — provided that the government has the confidence to trust the world’s best science and break from Brussels practice of making political regulatory decisions long after normal deadlines. – Mark Buckingham for The Times (£)

Lee Rotherham: What’s the point of Brexit if we’re shackled to a customs union?

Informed reporting from Brussels suggests the Chequers proposals are heading towards delivering a rebranded Customs Union. This will be couched in terms of a temporary and transitional nature, but with little to actually vouchsafe that future promised motion, and structurally everything to hinder it. Treating the parliamentary and public debate that will imminently develop as a simple ‘Marathon into Snickers’ marketing exercise would be a mistake of the first order. As has been explored elsewhere, Whitehall’s touted model is inherently flawed and carries with it considerable baggage. It was ruled out during the referendum and so has no mandate from that poll. It was ruled out by the Conservative Party manifesto, which pledged “we will no longer be members of the single market or customs union”. And it is inherently unstable, since it has fewer safeguards than Norway’s supposed “Fax Democracy”, beyond those clauses that would sectorally collapse bilateral arrangements – and we have already seen how big corporate interests pile in to hinder change. – Lee Rotherham for ConservativeHome

Brexit in Brief

  • Olly Robbins: Britain’s real Brexit broker – Profile in the FT (£)
  • A cautionary tale for how a Brexit summit can collapse – Ian Wishart for Bloomberg
  • If Brexiteers want a Canada-style deal, they need a new Prime Minister – Andrew Gimson for CapX
  • People’s Vote celebrity ad: I voted Remain… and I still want to Remain – Steerpike for The Spectator
  • Ireland signs up to French version of the Commonwealth in bid to wield more clout after Brexit – Telegraph (£)
  • Brexit negotiators eye Monday breakthrough as Northern Irish party ups the ante – Reuters
  • Brexit-bashing tax chief gets death threats but vows to keep ‘speaking truth to power’ – The Sun
  • Tony Blair says research shows Chequers plan almost as bad as no-deal Brexit for services sector – Telegraph (£)