DUP threaten to ‘vote down Budget’ if Brexit deal crosses their red lines: Brexit News for Thursday 11th October

DUP threaten to ‘vote down Budget’ if Brexit deal crosses their red lines: Brexit News for Thursday 11th October

DUP threaten to vote down the Budget if Brexit deal crosses their red lines…

Theresa May’s allies in the DUP could vote to throw her out of office if she strikes a Brexit deal they don’t like, it emerged today. The unionists are reportedly prepared to vote against the Budget in protest at a Brexit agreement which breaches their red lines. The drastic move would throw the PM’s future into doubt – because Budget motions have traditionally been seen as a vote of confidence. Mrs May relies on the DUP’s ten MPs for her Commons majority and would lose any vote where the party teamed up with Labour, the SNP and Lib Dems. The Northern Irish party has repeatedly said it would veto any Brexit deal which created a border in the Irish Sea. – The Sun

  • DUP threatens to vote down Budget amid fears Theresa May is poised to cross its Brexit ‘blood red line’ – Telegraph (£)
  • DUP threatens to vote down budget over Brexit – The Times (£)
  • DUP and Tory alliance at breaking point as Arlene Foster’s party threatens to drop Brexit support and torpedo the Budget – The Sun
  • We will not be bullied into propping up a soft-touch Government which gives in to the EU’s demands – Sammy Wilson MP for the Telegraph (£)

…after Michel Barnier told them Great Britain – but not Northern Ireland – could sign a free trade deal with the EU…  

The DUP is growing alarmed because it fears Downing St is edging towards a deal with the EU that may lead to additional regulatory checks on goods travelling between Great Britain and Northern Ireland. Michel Barnier, the EU’s chief negotiator, has called for such checks to avoid creating a hard border between Northern Ireland and the Irish Republic. This would be achieved by aligning Northern Ireland with the rules of the single market. The prime minister has strongly rejected the Barnier plan. But senior DUP sources fear that Downing St may agree to some form of regulatory checks. The DUP was concerned after Mr Barnier reportedly told the party in Brussels this week that Great Britain is entitled to sign a traditional free trade deal with the EU. But Northern Ireland would have to be separate and subject to the rules of the single market to avoid a hard border on the island of Ireland. – Nick Watt for BBC News

…prompting them to abstain in a vote on the Agriculture Bill last night as a sign of their determination

Last night, DUP MPs fired a warning shot by abstaining on a Labour amendment to the agriculture bill. The unionist party normally votes with the Conservatives in the Commons, although the amendment was nevertheless defeated. – Guardian

Theresa May set to ask ministers to agree a Brexit deal that keeps the UK in a customs union…

Theresa May will on Thursday ask her Brexit “war Cabinet” to agree a backstop plan that would keep Britain in a customs union with Brussels until a permanent trade deal can be agreed. British and EU negotiators are understood to have agreed in principle to an all-UK backstop plan to avoid a hard border in Northern Ireland that would remove the final major obstacle blocking a withdrawal agreement… The backstop plan being proposed by Mrs May would involve the whole of the UK remaining in a customs union with the EU while negotiations over a free trade deal take place, which Brexiteers fear could take years. Mainland Britain would leave the single market, allowing Great Britain to set its own regulations, but Northern Ireland would stay in the single market for goods, meaning there would have to be increased regulatory checks on goods crossing the Irish Sea. – Telegraph (£)

  • Theresa May’s reported Brexit plan would maroon Britain in EU customs territory – Telegraph (£)

…as Michel Barnier says a Brexit deal is ‘within reach by next week’ but also warns a customs union may be necessary…

Michel Barnier has said that a Brexit deal is “within reach” by next Wednesday but warned that the only way to avoid border checks in the Irish Sea is if Britain stayed in a customs union with Brussels. Amid growing certainty in Westminster that a deal has been done with Brussels, leading Brexiteers such as Boris Johnson and Jacob Rees-Mogg went on the attack with Mr Johnson saying it would “make the UK a permanent EU colony”. Referring to next week’s EU summit in Brussels, Mr Barnier said: “An agreement is within reach if we have the negotiations on October 17 at the next council meeting.” Remaining in a customs union would prevent Britain being able to make its own trade deals but, the EU’s chief Brexit negotiator said it was the only way to prevent  many customs checks from being carried out between mainland Britain and Northern Ireland. – Telegraph (£)

…which Boris Johnson concludes would make the UK a ‘permanent EU colony’

Boris Johnson has accused Theresa May of negotiating a “backstop” solution for Northern Ireland that will turn Britain into a “permanent EU colony” after Michel Barnier insisted the UK will have to stay in the customs union. The former foreign secretary said the Prime Minister was ignoring what “the biggest majority in our history voted for” and was allowing the UK to be sucked into an arrangement that will prevent global trade deals. It comes amid informed reports that Mrs May will present the backstop agreement to her inner Brexit cabinet on Thursday afternoon. Mr Barnier, the EU’s chief Brexit negotiator, said the EU was still “open” to keeping a customs union with the UK. The deal risks bringing down the Government if the DUP does not support it. It also emerged that Democratic Unionist MPs who prop up Theresa May’s Government are preparing to vote against her Budget if the Prime Minister breaks their Brexit red lines. – Telegraph (£)

Theresa May urged by Ken Clarke to isolate ‘hardline Eurosceptics’ and deliver Brexit deal to unite Tory and Labour Europhiles…

Theresa May has been urged to isolate “hardline Eurosceptics” and deliver a Brexit deal capable of uniting pro-European Tory and Labour MPs. Ken Clarke, the Tory former chancellor, said the “maths makes it obvious” that the only way for the Prime Minister to get an agreement through the House of Commons would be to unite Europhile MPs. But Mrs May said she hoped “everybody across this whole House will put the national interest first” when it comes to voting on her deal as she said MPs had a “duty” to deliver on the result of the 2016 EU referendum. Mr Clarke’s intervention came as pressure continued to grow on Mrs May to ditch her Chequers plan for Brexit and as talks entered a critical phase ahead of a crunch EU summit next week. – Telegraph (£)

  • Parliament erupts as Ken Clarke makes shock claim Brexiteers are ‘right wing nationalists’ – Express

> On BrexitCentral’s YouTube channel: Ken Clarke asks Theresa May how she will pass her deal through Parliament at PMQs

…as Remainer Tory MPs also prepare to form a group to vote down May’s Brexit deal

A group of remain-backing Tory MPs are plotting to form a rival movement to Jacob Rees-Mogg’s highly effective Eurosceptics, with the aim of voting down Theresa May’s Brexit deal amid concerns that it would wreck the economy. Senior MPs behind the new group said they believed the Eurosceptics would eventually swing behind May’s final Brexit deal, but Tory whips had underestimated the strength of feeling from the other wing of the party. It is claimed that up to 30 pro-Europe Tory MPs are sympathetic to the idea of voting against a version of May’s Chequers deal, in particular if she moves towards a Canada-style free trade deal after the final round of frantic negotiations with Brussels. – The Guardian

  • Thirty Conservative MPs gang together to demand another Brexit vote – and will vote down deal – Express

…while up to 30 Labour MPs are considering voting for it

Up to 30 Labour MPs are considering defying their party leadership and voting for Theresa May’s Brexit deal — or abstaining — because they fear the economic consequences of the UK leaving the EU with no agreement. Jeremy Corbyn, the Labour leader, is expected to whip his MPs to vote against whatever deal the prime minister achieves because it is unlikely to meet his party’s “six tests” — in the hope that this could precipitate a general election. But many of his own MPs are agonising about the risk of rejecting a May-brokered deal because the consequences could be a new, more Eurosceptic Conservative prime minister and a damaging no-deal Brexit. One shadow minister said the decision over how to vote would be a “tough call” and a “crisis of conscience” for many Labour MPs because of the potential damage of a no-deal withdrawal agreement. – FT (£)

  • 30 Labour MPs ‘set to back Theresa May in Commons vote’ because they’re scared of No Deal – The Sun
  • Theresa May calls on Labour MPs to put ‘national interest’ first and back her Brexit deal in defiance of Corbyn – Independent

May will ‘put country before party’ insists David Lidington

David Lidington MP says the Prime Minister will put the country before party unity as she heads into a crucial phased of Brexit negotiations. Minister for the Cabinet Office was adamant that Theresa May will ensure the United Kingdom will get the best deal from Brexit, even at the cost of her fractured party. The Conservatives are split over what sort of deal they want from negotiations with the European Union, leaving many to wonder whether Mrs May will decide to do what is necessary to save her party rather than what is good for the country as a whole. “What’s important for us is doing what’s right for the country,” Mr Lidington told Peston. “We want to do what’s right for the country and that is what is animating our entire approach to the negotiations.” – ITV News

EU and UK warn obstacles remain as Brexit compromise edges closer

Brexit negotiators are edging toward a compromise on the thorniest issue in talks, even as officials on both sides warned that obstacles still stand in the way of a deal. EU chief Brexit negotiator Michel Barnier said Wednesday that a deal is within reach, and officials in Brussels and London said some progress was being made in intense negotiations. While the Telegraph reported late Wednesday that an agreement had been clinched, EU and U.K. officials warned in public and in private against predictions that a deal is in the bag. “It’s too early to be putting champagne on ice,” Prime Minister Theresa May’s de-facto deputy, David Lidington, said Wednesday in an ITV interview. “We’ve got a fair way to go still. There are still differences between our position and that of the European Commission, but we’re working very hard to overcome them.” – Bloomberg

  • Brexit negotiators working ‘day and night’ for agreement – BBC News

UK economy bolstered by a solid summer (despite Brexit)

Britain’s long hot summer helped boost its economy in the three months to August, according to data published by the Office for National Statistics on Wednesday. Upward revisions to previously published estimates meant the economy grew 0.7 per cent during the three months ending in August, better than the 0.6 per cent expected by analysts. This was the highest rate since the fourth quarter of 2016, when the UK was the fastest growing economy in the G7 group of large rich nations. However, in August itself the economy stagnated following a 0.4 per cent expansion in July — although the ONS has warned that monthly data can be volatile and the agency recommends using the three-month growth figure. – FT (£)

  • Latest ONS figures show rise in exports – Gov.UK

Theresa May guilty of ‘culpable naivety’ in Brexit negotiations, warns former Ambassador to Brussels

Theresa May has been guilty of “culpable naivety” in her Brexit negotiations with Europe, her former ambassador to Brussels warned last night, while accusing Boris Johnson and other senior cabinet ministers of living on “fantasy island”. Sir Ivan Rogers, who resigned in January 2017 after falling out with Mrs May’s political team, mounted a forensic deconstruction of UK government’s handling of the Brexit negotiation at a speech at Cambridge University. “Nearly two-and-a-half years on from the referendum, we are – both on the EU [trade] deal, and on other post Brexit trade deals – still lost in campaign mode on fantasy island,” he warned. Sir Ivan recalled that before he quit the Civil Service “senior cabinet ministers” who are still “central players” in the negotiation were still insisting that the UK would have completed negotiations on a free trade deal with Europe before Brexit day in March 2019. – Telegraph (£)

  • May’s Brexit negotiations lambasted by pro-EU ex-ambassador – Express

Gordon Brown claims there will be another referendum on Brexit

Mr Brown said he is “not sure” about when this second referendum will take place, but has predicted it will happen. He added it would be the “only way” to sort out the “problem”. He said the SNP, Labour and Liberal Democrats would back a public vote on the issue at a future general election if, as he expects, a transition period is extended due to no deal being reached in March. He made the comments during a question-and-answer session which followed him giving the inaugural memorial lecture in Edinburgh in memory of late motor neurone disease campaigner Gordon Aikman. An audience member asked Mr Brown if he supports a so-called People’s Vote on the final Brexit deal and if this should have remaining in the EU as an option. – Evening Standard

  • Gordon Brown predicts second Brexit referendum – Independent

German and Spanish businesses warn that a no-deal Brexit would cause a ‘massive crisis’ across Europe

Panicked German and Spanish businesses have heaped pressure on Brussels to compromise after warning a no deal Brexit would spark a “massive crisis” across Europe. Industry chiefs in Berlin and Madrid called for a breakthrough within two weeks as capitals get the jitters over the economic impact of a crash out. Germany’s biggest industry group, the BDI, intervened after a bombshell study showed the huge hit the country’s economy faces from no deal. And Spain’s tourism chief in the UK said such a scenario would be a “disaster” for popular holiday destinations causing significant job losses. BDI chief Joachim Lang said: “The next EU summit in two weeks must bring a breakthrough in the talks. Otherwise, Europe is in danger of sliding into a disorderly Brexit.” – The Sun

  • Spain in Brexit panic as tourist boss warns of no deal disaster – Express

Sammy Wilson: We will not be bullied into propping up a soft-touch Government which gives in to the EU’s demands

To date the Government has signalled to the EU negotiators that we are a soft touch who can be pushed around. As a result, we have encouraged the EU to stick to their totally unrealistic demands that internal economic and regulatory boundaries be imposed within the UK, otherwise there will be no deal on future trade arrangements… If the Government is putting these proposals into the public domain to test the water, our advice is to get its toe out quickly or it is going to get burnt! As a Unionist party, we will not give our support to any deal which includes such economically and constitutionally damaging arrangements. – DUP Brexit spokesman Sammy Wilson MP for the Telegraph (£)

James Forsyth: Will Theresa May call the DUP’s bluff on Brexit?

Some in government believe that, ultimately, May is going to have to call the DUP’s bluff on extra regulatory checks in the Irish Sea. They argue that the DUP will never risk putting Jeremy Corbyn, a man who favours a united Ireland and was deeply sympathetic to the IRA, in Downing Street. But I understand that the DUP have privately emphasised to several Cabinet Ministers that they really would be prepared to vote down the withdrawal agreement and risk a Corbyn government if that is what was required to prevent the emergence of any new barriers between Great Britain and Northern Ireland. – James Forsyth for The Spectator’s Coffee House blog

Shanker Singham: The backstop is not an insurance policy, it is a hidden trap

There are several myths surrounding the Irish backstop issue, which must be straightened out at this crucial time to ensure that the opportunities Brexit offers are not squandered. The backstop has often been described as an insurance policy by the government. It is, in fact, a hidden trap that could lead to the complete evisceration of the benefits of Brexit, giving us the worst of all worlds. – Shanker Singham for The Times (£)

The Sun says: PM is taking a dangerous gamble by hoping Labour MPs back her Brexit plan

Theresa May is taking a dangerous ­gamble in disregarding her own Commons allies and hoping dozens of Labour MPs side with her over Brexit. We understand her desperation to avoid no-deal. It would be damaging for both sides, which is why German and Spanish businesses are panicking. But to challenge the DUP to like her deal or lump it, when they are openly threatening to defeat the Budget, looks reckless. Even if they don’t, she still needs their votes to govern post-Brexit. And can the Prime Minister really trust the supposedly sensible wing of the Labour Party to make up the numbers on the final deal? – The Sun

Frank Field and Simon Clarke: Freeports would boost the North after Brexit

Whichever side of the Brexit debate one stands, there are three aims that achieve uncommon consensus: first, that we should maintain and improve the competitiveness of British industry; second, that jobs and prosperity need to be spread more equitably across the country; and, third, that our existing trade with the EU should remain as frictionless as possible. The introduction of freeports in the UK would take out these three birds with one stone. At its simplest, a freeport is an area that is physically within a country but legally outside it for customs purposes. Goods that enter a freeport do not incur import duty. Instead, import duty is only paid if and when goods pass from the freeport into the domestic economy. – Frank Field MP and Simon Clarke MP for The Times (£)

David Mundy: The rocky road to a second Brexit referendum

The clamour for a second Brexit referendum is growing louder, but organising another vote would be fraught with legal difficulties. First, it would require the government to table new legislation, and unlike the 2015 act, this bill would have to include a clear statutory commitment to act on the result. This takes time. A bill of this importance would be difficult to get through parliament in less than five months. In addition, the law requires the Electoral Commission to be consulted on the question in all its potential permutations: leave/remain, soft Brexit/remain, no-deal Brexit/remain. There would also need to be a period for a brief campaign. – David Mundy for The Times (£)

Brexit in Brief

  • Britain and France need each other – Philip Stephens for FT (£)
  • Should Britain heed the Japanese Prime Minister and join the Trans-Pacific Partnership after Brexit? – Molly Kiniry and Emily Redding for City A.M.
  • The Treasury keeps the UK under the control of EU austerity policies – John Redwood’s Diary
  • ‘It’s all kicking off’ – Laura Kuenssberg for BBC News
  • Amber Rudd’s reply to David Davis’ letter to colleagues – Guido Fawkes  
  • Tony Blair warns of Chequers plan’s impact on services after Brexit – FT (£)
  • French President Macron and Dutch PM Rutte form alliance for European elections aimed at redrawing the European political map – Politico
  • No-deal Brexit could spell chaos for UK borders and ‘there will be points of failure’, warns Whitehall spending watchdog – Telegraph (£)
  • No more than 5,000 City jobs will go before Brexit day next March, says minister – Telegraph (£)