Brexit News for Thursday 19 October

Brexit News for Thursday 19 October
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Theresa May makes offer to EU citizens ahead of today’s crunch summit…

Theresa May has vowed to make it as easy as possible for EU citizens to remain in the UK after Brexit ahead of a key summit of European leaders. In a Facebook post, the prime minister insisted the application process for settled status would be “streamlined” and the cost “as low as possible”. She said representatives of EU citizens will sit on a “user group” which will iron out any problems in the system. – BBC News

  • May to make 11th hour plea to EU27 leaders on trade and transition – City A.M.
  • Theresa May has held up her part of the deal – now the EU must follow suit – The Sun says
  • EU migrants coming to UK over next 18 months can stay for good after Brexit, officials concede – Telegraph (£)

…as the Prime Minister is urged to make ‘deal or no deal’ ultimatum in Brussels…

Britain must be prepared to walk away from the EU and stop negotiations if European leaders do not agree to trade talks at a crucial summit on Thursday evening, senior figures behind the Leave campaign warned on Wednesday night. In an open letter to the Prime Minister, four former Cabinet ministers, as well as MPs, business leaders and academics demanded she “formally declare” that Britain will leave the EU and conduct trade deals via the World Trade Organisation. – Telegraph (£)

> John Longworth on BrexitCentral today: Theresa May must be prepared to declare for a clean, swift Brexit before it is too late

…with EU leaders set to let Theresa May down gently over trade talks rebuff…

European Union leaders at a crunch summit dinner are set to rebuff Theresa May’s appeal for trade talks while they seek to publicly talk up her efforts in the Brexit negotiations because they fear that the prime minister’s domestic weakness will leave her unable to make vital concessions on Britain’s divorce bill. The German chancellor, Angela Merkel, will lead European leaders in Brussels on Thursday in seeking to put the best gloss on their refusal to widen the talks, according to diplomatic sources. “There are ways to say it kindly and encouragingly or less kindly and less encouraging,” said one senior EU diplomat. – Guardian

…as it is reported that Britain will be hit with an extra £6bn demand amid row over EU pensions…

Britain is fighting a Brussels “rip-off” that adds up to €7 billion (£6.25 billion) to the Brexit divorce bill by inflating the cost of pension liabilities for retired European Union officials. A demand for Britain to pay its share towards the rising cost of Brussels pensions is the main sticking point blocking trade and transition talks to prevent a no-deal scenario, it can be revealed. Experts and diplomats told The Times that the amount demanded by the EU for pension liabilities, about €11 billion, is unfairly high because the wrong rate is being used to calculate it. – Times (£)

…while Jeremy Corbyn will also roll up in Brussels today

Jeremy Corbyn will meet the EU’s chief negotiator, Michel Barnier, in Brussels on Thursday, as he seeks to exploit Tory division over Brexit and present Labour as a better negotiating team. As well as Barnier, Corbyn will hold bilateral meetings with three EU prime ministers, as Britain’s negotiating partners try to gauge the balance of power over Brexit. Corbyn, who will be accompanied by the shadow Brexit secretary, Keir Starmer, and the shadow international trade secretary, Barry Gardiner, said: “As the government’s splits and Brexit bungling become ever more damaging, Labour stands ready to take up responsibility for the Brexit negotiations.” – Guardian

  • Labour will not accept a no-deal Brexit, repeats Emily Thornberry – BBC News

Germany drafts outline of EU-UK ties post-Brexit…

Germany is working on proposals for the European Union’s future relations with the U.K. that include calls for a “comprehensive free-trade accord” with the British government, according to a draft paper prepared by the Foreign Ministry in Berlin. The four-page document, dated Oct. 11, urges the EU avoid a piecemeal approach if and when talks with the U.K. get under way. It proposes instead a broad partnership that includes “at a minimum” the fields of foreign and security policy; fighting terrorism; cooperation on criminal justice; agriculture and fisheries; energy; transport, and especially air transport; research and digital issues. – Bloomberg

…as a German official says Berlin is upbeat on Brexit negotiations

Germany believes a lot has already been achieved in Brexit negotiations and Berlin is upbeat about the prospects of making further progress in the talks, a German government official said on Wednesday. EU leaders will discuss Brexit at a summit on Thursday and Friday, when they will deliver a verdict on progress made in the talks so far. EU negotiators want “sufficient progress” to justify opening trade negotiations with Britain. – Reuters

  • Britain confronts tough German line on Brexit – FT (£)

Liam Fox launches new group to ensure business is consulted “every step of the way” over post-Brexit trade policy

The International Trade Secretary, Liam Fox, has today convened the first meeting of a new consultative group bringing together the country’s five biggest business organisations. The group has been created to ensure that voices representing businesses of all sizes and from every sector of the British economy are involved with the formulation of post-Brexit trade and export policy at the Department for International Trade. – BrexitCentral

Brexit leads to every department getting a minister to deal with secondary legislation

Every government department now has a Brexit minister and a senior civil servant to oversee Brexit legislation. The Leader of the House of Commons said it demonstrated the government was ‘cranking up a gear’ when it came to Brexit, telling a Commons Committee she hoped people would notice the difference. Greg Hands, in the Trade department and John Hayes in the Department for Transport had been given extra responsibilities in their departments for dealing with Secondary legislation required for Brexit. But Andrea Leadsom told the Commons Procedure Committee that each government department would have a minister responsible for Brexit legislation. – BrexitCentral

EU Withdrawal Bill not set to return to the Commons for several weeks yet

The key piece of legislation was originally set to be debated in the Commons this week but it now looks set to be put off until parliament reconvenes after the autumn recess. The Government is anticipating significant opposition among Conservative MPs on a large number of amendments, threatening Theresa May’s fragile Commons majority. One source told the BBC the delay is because there is “not enough political agreement yet”. – Politics Home

  • Government’s flagship Brexit Bill ‘faces weeks of delays’ over fears Tory rebels could vote against it – Telegraph

The six tribes of Brexit revealed

The detailed survey of 4,000 voters by Ipsos Mori, conducted over the course of the last year and published on Tuesday, identifies the disparate groups that make up the Leave and Remain camps, as well as those who fall somewhere in-between. The FT has looked at the groups and assessed how their characteristics and experiences influenced their votes for or against Brexit. – FT (£)

David Paton: A no-deal Brexit is an essential negotiating strategy and may even boost the economy

“John McDonnell and other Shadow Cabinet members have recently announced that the Labour Party will oppose a ‘no-deal’ Brexit outcome irrespective of the circumstances. Although they justified this stand on the grounds that the economic costs of no deal would be disastrous, their approach poses significant risks both for the Brexit negotiations and the economy itself.If the other side in a negotiation knows that you will never walk away without a deal, they hold the power and it is almost certain that you will end up with a worse deal than you might otherwise.” – Professor David Paton for The UK in a Changing Europe

Telegraph: It is time for the Government to take ‘no deal’ seriously

The EU Withdrawal Bill is appropriately named; it has once again been withdrawn from Parliamentary scrutiny pending further discussions with Conservative critics. The Prime Minister’s failure to win a majority at the election in June has left all government legislation vulnerable to even the most small-scale rebellion on the Tory benches. But no measure is more important than this if the country’s laws are to be ready for the exit from the EU in March 2019. – Telegraph editorial

Ambrose Evans-Pritchard: An EU transition deal is dangerous diplomatic fiction

Britain is walking into a trap. Little by little, the quest for a transition deal has become the Government’s negotiating lodestar. It is taking over the process. The European side is only too happy to string this along – vaguely – because it works entirely to their advantage and ultimately leaves this nation crippled when the cliff-edge finally arrives. The UK strategy is futile. In the end there can be no transition because the complexities of EU law and international trade law make it almost impossible. – Ambrose Evans-Pritchard for the Telegraph

DeAnne Julius: Reasons why a no-deal Brexit would suit the EU

Game theory provides many examples where the outcome of a negotiation is worse for both sides than a mutually beneficial compromise. A no-deal Brexit would have costs to the EU beyond the loss of Britain’s budgetary contribution. EU exports to the UK are 30 per cent larger than Britain’s exports to the EU. The number of EU citizens living in Britain is roughly three times as large as the number of British citizens living in the EU. Both sides would benefit from a balanced deal. But for the reasons given here, a no-deal Brexit may be the route the EU determines. This makes it all the more imperative that the UK government embarks on serious preparation for World Trade Organisation regulated trade and new unilateral immigration policies that benefit the national economy post-Brexit. – DeAnne Julius for the FT (£)

Iain Martin: Diehard Remainers are playing with fire

I have a stark warning from the Leave side of the argument about the potential implications of keeping Britain in the EU against the wishes of voters. Those trying to stop Brexit are playing with matches in a petrol station. Right now, Brexiteers may be depressed by the difficulties of the talks and their own failures of planning but if the process is stopped or looks like it could be, those who campaigned for it are hardly going to sit back. They will organise, and quickly. – Iain Martin for the Times (£)

Iain Duncan Smith: Labour’s position on Brexit defies logic

On Sunday John McDonnell, the shadow chancellor, declared on the BBC’s Andrew Marr Show that he will “not countenance no deal” with the European Union. Effectively, that means that a Labour government would walk into negotiations with the EU with the message: “We will take whatever is on offer.” That’s not negotiation, that’s capitulation. In simple terms, that’s like asking a car insurer for a good deal while admitting you won’t look at any of the offers from their rivals. Or going into a shop and telling the salesperson you’re happy to pay any price. – Iain Duncan Smith for the Times (£)

Tom Harris: Is there anything British voters want less than a brand new anti-Brexit ‘centrist’ party?

You’ll forgive me if I remain rather underwhelmed by the launch of the latest “centre party”, the Radicals. The name is derived from their commitment to maintaining the status quo in respect of our membership of the EU (take that, Establishment!) and was accidentally launched last night by the Berlin correspondent of the Economist, Jeremy Cliffe. As is the way with these things, he tweeted a thought about a new anti-Brexit party and was astounded (!) that others on Twitter agreed with him. – Tom Harris for the Telegraph (£)

Asa Bennett: When Theresa May’s nest of birds sing out of tune, Brussels can hear it

There can be more to Boris Johnson’s turns of phrase than may first appear, as you might expect from a former Telegraph man. When he described his deputy at the Foreign Office as “that Mount Rushmore of wisdom Sir Alan Duncan”, his audience may not have picked up the potential dig in his tribute by suggesting he has four faces. Similarly, when the Foreign Secretary dismissed claims of cabinet disunity over Brexit by declaring that “we are a nest of singing birds”, he didn’t necessarily mean that they were all singing in harmony with Theresa May. – Asa Bennett for the Telegraph (£)

Nile Gardiner: Why there will be a trade deal between Britain and America

The administration has spoken strongly in favour of direct bilateral trade deals which create jobs, advance prosperity and help the US economy. The Trump presidency is already engaged in talks with the British government on implementing a post-EU trade agreement between the United States and the United Kingdom. Much to the chagrin of the European Commission, the reality is that a US-UK free trade deal will be in place long before the United States strikes a deal with the European Union – if ever. – Nile Gardiner for CapX

Gerald Warner: A Europe we can believe in

Brexit will renew Britain’s authentic European identity, making us the first country to re-embrace that heritage. History, culture, religion, legal principles, political concepts, philosophy, art, architecture and a myriad other legacies and affections affirm our identity as Europeans. That identity will be less muddied once we slough off the yoke of the sclerotic EU and emerge from behind Merkel’s Berlin Wall. We shall be able to listen to Beethoven’s Ninth Symphony again without a frisson of political distaste. – Gerald Warner for Reaction

Brexit comment in brief

  • Good economic news for Britain will confound Brexit doom-mongers – Express
  • Class clowns Phillip Hammond and Amber Rudd are putting their careers above our future – and Theresa May should sack them both – Rod Liddle for The Sun
  • Brexit burden will hit businesses outside the UK too – Inside Business for the FT (£)
  • What happens at the Brexit cliff edge – David M. Herszenhorn for Politico
  • Both the UK and the EU need a solution to Brexit – FT editorial
  • Britain needs to insure against a post-Brexit slump – Bundeep Singh Rangar for the Telegraph (£)
  • EU threats to the City expose taxpayers to the risk we fought so hard to limit after the financial crisis – Xavier Rolet for the Telegraph (£)
  • Time to show Brexit doesn’t mean doing less for refugee children – Nicky Morgan and Tim Loughton for the Telegraph (£)
  • Germany is Europe’s reluctant hegemon. To succeed, Theresa May must decipher it – Nick Timothy for the Telegraph (£)

Brexit news in brief

  • Angela Merkel broke promise to Theresa May that she would sack EU aide nicknamed ‘Darth Vader’ – The Sun
  • British EU Commissioner Sir Julian King says cooperation on security ‘non negotiable’ post-Brexit – Express
  • Economist journalist sets up new pro-EU party – Guido Fawkes
  • Tusk snubs Juncker on post-Brexit day summit – Politico
  • The case for a longer Brexit transition – FT (£)
  • This is what the Brexit cliff edge looks like – Politico
  • Brexiteers accused of ‘bullying’ the EU as commissioner warns hard Brexit cliff edge is ‘so close we can see the drop’ – Telegraph

And finally… Tim Martin says unilateral free trade would reduce the price of beer

Wetherspoon’s boss Tim Martin has called for the government to pursue unilateral free trade if the UK leaves the EU with no agreement over terms. In an article sent to journalists this morning, Martin wrote that Wetherspoon’s had calculated that the price per meal or pint sold at its pubs would be 1.5p lower if the UK chose this approach. – City A.M.