May’s ‘most loyal Cabinet minister' to confront Johnson: Brexit News for Thursday 8 February

May’s ‘most loyal Cabinet minister' to confront Johnson: Brexit News for Thursday 8 February
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Theresa May and senior ministers start to hammer out Brexit positions…

Theresa May has been chairing the first of two key Brexit meetings with senior ministers as the government faces more calls to clarify the UK’s position. The Brexit cabinet committee is to sketch out what the future relationship between the UK and EU might look like. It was expected to focus on Northern Ireland and immigration… The 11-member European Union Exit and Trade (Strategy and Negotiations) sub-committee is a key part of the government’s decision-making process. Its members include Foreign Secretary Boris Johnson and Environment Secretary Michael Gove, who were at the forefront of the Leave campaign in the EU referendum, and Chancellor Philip Hammond and Home Secretary Amber Rudd, who campaigned for Remain. They are expected to discuss trade at another meeting on Thursday. – BBC News

  • Theresa May chairs her Brexit ‘War Cabinet’ to thrash out a plan for the EU negotiation – The Sun
  • Theresa May’s cabinet meet to thrash out Brexit differences ahead of key negotiations – Express

…as May’s ‘most loyal Cabinet minister is slipped onto Brexit committee to confront Boris Johnson’…

Northern Ireland Secretary Karen Bradley was quietly made a permanent member of the decision forum last week, sparking claims she is preparing to confront Boris Johnson… Until ultra-loyal Ms Bradley’s appointment, the 10-strong committee had a small majority for a harder Brexit, by five versus four, with the PM in the middle of the vicious feud. Brexiteers lead by Foreign Secretary Boris Johnson were given the upper hand when new Defence Secretary Gavin Williamson said he will side with the Leavers, who are locked in a stand-off with former pro-EU campaigners lead by Chancellor Philip Hammond. The arrival of Ms Bradley, who campaigned for Remain, tips the balance back. – The Sun

  • Irish border sharply divides UK’s Brexit cabinet – FT (£)

> Hugh Bennett on BrexitCentral today: It’s time to stop doom-mongering over the Irish border – the solutions are already out there

…with Cabinet reportedly still ‘a million miles away’ from agreeing a Brexit position…

Theresa May’s Cabinet is still “a million miles away” from agreeing the Government’s position on Brexit after the first of two key meetings of senior ministers, The Daily Telegraph has been told… Sources say there are still “substantial divisions” between Brexiteers and Remainers in the 11-strong Brexit “war Cabinet”, which will meet again on Thursday to discuss the Government’s position on a future trade deal. “Nothing” was agreed after two hours of discussion on Wednesday… Whitehall sources said the meeting was “flat” with “no real in-depth discussion of the issues”. One source said: “There is mounting concern that nothing has been agreed yet. No-one seems to know when this is going to be sorted out. – Telegraph

  • May’s indecision is not helping Tory Brexit tensions – James Forsyth for the Spectator

…while May‘s ‘plan for an immediate break with EU after Brexit’ is revealed

The outlines of the long-awaited plan, which will be discussed by a Brexit sub-committee of May’s Cabinet Thursday and are expected to be signed off by the full Cabinet over the coming weeks, envisages the U.K. diverging from a series of key EU rules and regulations “immediately” after the end of any Brexit transition period while retaining the power to go further in other areas at a later stage, according to senior British officials. One official named three areas where the government wants to diverge after Brexit: agricultural subsidies currently administered under the Common Agricultural Policy, financial services regulation and trade policy. Another official agreed these three policy areas were being discussed and said imposing restrictions on freedom of movement was also an imperative for the government, as was the desire to spend money recouped from the EU budget on public services such as the NHS. “Everyone around Cabinet agreed there should be a Brexit bonus,” the second official said. – Politico

Brexit backers’ fury at more leaked economic forecasts which will ‘destroy civil service reputation’

Fuming Brexiteers have lashed out at Remoaner civil servants after more leaked economic forecasts were revealed. Leave-backing MPs described the latest leaks – which claim the North East and Ireland will be hugely hit economically when we leave the EU – as “nonsense”. And they claimed that Whitehall workers were trying to overturn the result of the referendum. Sky News revealed this evening more details from the Brexit impact assessments that got into the public domain last week, showing our economy would suffer when we leave the EU. It claimed that Northern Ireland’s GDP could slum 12 per cent over 15 years, and the North East of England’s would see a 16 per cent hit. But No10 insisted that the analysis still wasn’t taking into account what will happen if we get a bespoke trade deal with the EU. – The Sun

  • Leaked Government analysis reveals post-Brexit impact on UK regions – Sky News
  • Boost from trade deals will not cover losses, claims Brexit leak – The Times (£)
  • New Brexit leak of Government analysis reveals steep costs for UK industries – Sky News

Theresa May to be ‘robust’ in face of EU ‘punishment’ threat during Brexit transition…

The Prime Minister dismissed as “noises off” a draft Brussels document on transitional arrangements, which included proposals for the EU to be handed the power to sanction the UK. In the event of a dispute between Brussels and London, the EU should be able to suspend Britain’s access to the single market – without referral to the European Court of Justice – during the interim phase between 2019 and 2021, the document states… The leaked Brussels plans have sparked anger among Brexiteers, who have urged Mrs May not to accept the proposals in upcoming negotiations over the Brexit transition period. Veteran Conservative eurosceptic Sir Bill Cash used Prime Minister’s Questions on Wednesday to ask if Mrs May will “ensure that we repudiate any of these EU threats”. – Sky News

  • Rees-Mogg leads Tories pushing May to help group fight ‘bullying’ EU – Express
  • By pushing a ‘vassal state’ transition, Brussels wants to punish Britain before it escapes – Asa Bennett for the Telegraph (£)
  • We are leaving the EU to get away from these rules – Express editorial

> WATCH: Sir Bill Cash asks the PM to be robust and repudiate EU threats

…as Angela Merkel vows to snatch business from the City after Brexit having finally secured a coalition deal with Martin Schulz’s Social Democrats

Angela Merkel has stitched together a coalition agreement which pledges to steal the London’s crown as Europe’s financial centre. Her pact with Martin Schulz’s left-wing Social Democrats says it wants to try and make Germany more attractive as we gear up to leave the EU. A draft of the agreement – which was made in principle earlier today – states: “In light of the upcoming withdrawal of the UK from the EU we are going to make Germany more attractive for financial institutions.” …The German Chancellor’s party finally thrashed out an agreement earlier that broke months of political deadlock in the country. Four months after the election took place, they are now set to put the deal to SPD members. At a joint news conference today Ms Merkel said it would provide for a “good and stable government”. – The Sun

  • Angela Merkel surrenders key cabinet posts to clinch coalition – The Times (£)
  • Martin Schulz as German foreign minister: a euro-fanatic and no friend to Britain – Walter Ellis for Reaction
  • Germany’s centre holds. But for how much longer? – Leopold Traugott for CapX
  • Angela Merkel’s new coalition is united by fear of AfD – William Cook for the Spectator
  • Merkel’s new deal will reshape the fate of Europe – Telegraph view (£)
  • Germany has a government-in-waiting at last, but it will not make Brexit any easier and its stability could be short lived – Times leader (£)

George Soros, the man who ‘broke the Bank of England’, backing secret plot to thwart Brexit

The investor is one of three senior figures linked to the Remain-supporting campaign group Best for Britain who plan to launch a nationwide advertising campaign this month, which they hope will lead to a second referendum to keep Britain in the EU. The campaign is trying to recruit major Tory donors in an attempt to undermine Theresa May… The memo also reveals that the group plans to provide financial support to European Movement, another campaign group which counts Stephen Dorrell, the former health minister, and Kenneth Clarke, the former chancellor, as chairman and vice-president. Their inclusion in the strategy will raise questions about whether backbench Tory MPs are working against their party in a bid to block Brexit… An MPs’ committee chaired by Anna Soubry was given support worth £25,000 by groups run by the figures at the heart of the campaign to overturn Brexit… Asked if it was appropriate for a Tory MP to oversee a group backed by Remain supporters intent on triggering an election, Ms Soubry declined to respond. – Telegraph (£)

All was not lost for the Europhiles, argued Lord Malloch-Brown. As a strategy paper he brought along with him documented, Parliament had voted to give itself a meaningful vote on the Brexit deal, a chance to strike a blow against leaving the EU, and so that vote would be the campaign’s target… When the meaningful vote finally arrived, enough pressure could be exerted on parliamentarians that the Government would lose… Except he seems to have misread his audience. Mr Soros and [Stephen] Peel had already given money towards Best for Britain. They were committed. The other guests, however, were rather less enthusiastic. It’s unclear what Sir Martin [Sorrell] thought, but the Tory donors were unmoved, if not a little perturbed. The strategy paper made clear that the entire plan hinged on bringing down a Conservative prime minister, and even a Conservative government. Being brought together secretively in the night to plot such a move did not go down well. No money was pledged to the scheme, nor, it seems, was any interest expressed in doing so. – Telegraph (£)

  • George Soros hands Gina Miller campaign £400,000 in desperate bid to stop Brexit – Express
  • Soros backs bid for second referendum – The Times (£)
  • Elitist Remainers are plotting to bring down the Government. This is a wake-up call for Tory MPs – Nick Timothy for the Telegraph (£)
  • MPs will see ‘the whole package’ on UK’s Brexit deal before they vote on it, says Theresa May – Telegraph
  • There will be no Brexit deal for Soros’s MPs to vote against – Paul Goodman for ConservativeHome
  • Out of touch Anna Soubry is playing right into Jeremy Corbyn’s hands – Stephen Pollard for the Express
  • Ignore Project Fear, Efta has a lot to offer Britain post-Brexit – Stephen Hammond MP for the Telegraph (£)

Labour admits its Brexit plan could prevent UK from striking global free trade deals

Labour’s Brexit plan could prevent the UK from striking global free trade deals after Britain leaves the European Union, the shadow business secretary has admitted. Rebecca Long-Bailey said it was “certainly a possibility” that Labour’s proposal to keep the UK in a customs union with the bloc could preclude the Government from doing deals with other countries. Ms Long-Bailey said the party “wouldn’t rule anything out at all” and that the terms of the UK’s future trading relationship with the EU remained up for negotiation. – Telegraph

UK’s financial tech industry sees investment grow by record 150 per cent — despite fears of Brexit slump

Britain’s booming financial tech industry saw investment soar by a record 150 per cent last year — despite fears a Brexit slump. More than £1.3 billion of new cash was pumped into UK startups like banking apps Transferwise and Monzo. And it pushed Britain’s innovative financial technology market ahead of China and second only to the USA. Half of the cash invested in the British firms came from outside of the UK, according to research Innovate Finance and Pitchbook… Digital and Culture Minister Matt Hancock said: “It is great to see Britain’s entrepreneurial juices are flowing with this record investment.” – The Sun

Theresa May and Japan’s UK investors to hold talks

Major Japanese investors in Britain, including the three big carmakers, are due to meet the prime minister and chancellor later today… Carmakers Nissan, Toyota and Honda were due to attend the talks, along with representatives from banks and drug companies. The meeting is on Thursday afternoon and the attendees “will cover the most significant investors in the UK in such areas as banking, life sciences, technology and the manufacturing sector”, a Downing Street spokesman said. – BBC News

The Sun: Brussels wants to ‘punish’ Britain, so we must stay strong and have a post-Brexit Plan B for when we’re backed into a corner

Remainers used to pretend Brussels had no desire to “punish” Britain. Now it has admitted it. Any perceived rule breach ­during the transition period and it will ground our flights, suspend single market access and impose tariffs without even a court’s say-so. Meanwhile it is busting a gut to lure bankers away from London… Michel Barnier’s initial negotiating position is obviously unacceptable and a taste of the delaying tactics to come. Brussels will aim to prolong all talks until we take any deal in desperation to avoid leaving without one. As the clock runs down, panic will be whipped up by Westminster Remainers, already treating gloomy economic forecasts as fact and clamouring to shackle us to the customs union for all time. There is a way out. Whatever strategy the Cabinet agrees today, we must get fully ready for a no-deal too. The Sun would much prefer a free trade agreement, but we MUST have a viable Plan B. – The Sun says

Ambrose Evans-Pritchard: Parliament is sleep-walking into a British Versailles over Europe

The torrent of leaked EU strategy papers from Brussels are a disturbing foretaste of the relationship that awaits the UK as a “demandeur”, pleading for leniency from a position of psychological defeatism. They strongly indicate that the EU is not only insisting on an asymmetric deal that locks in its £80bn goods surplus with the UK, but also that Britain should be bound by sweeping extra-territorial control and should pay annual tribute for the privilege of its own infeudation. It is not a Canada option at all. Canada would have rejected such terms without compunction… The text leaves no doubt that the EU aims to control Britain’s future tax policies, regulations, employment laws, and industrial regime, in fine detail – beyond any normal governance codes set by the WTO and the OECD – and that this deviant island should be watched, coerced, and brought to heel. – Ambrose Evans-Pritchard for the Telegraph (£)

Liam Fox: Thanks to Brexit, the full benefits of free trade will be made available to everyone

Free trade creates prosperity, increases consumer choice and creates jobs. It has acted as the greatest force for combatting global poverty in recent decades. With one billion people taken out of poverty in the past generation, we have a moral duty to ensure that the full benefits of free trade are made available to everyone in all parts of our country. [Caroline] Lucas refers to our plans as “undemocratic” – again another irony since our Trade Bill, which has just been through committee stage, will allow us to operate as an independent trading nation for the first time in 40 years. Lucas goes on to criticise our bill on the grounds that parliament would not get to vote on any future trade agreements. This appears to show a complete lack of understanding of the bill, which is not about those new relationships. Instead, it is about preserving and ensuring continuity. It does not legislate for powers that could be used when implementing new free trade agreements with countries with whom the EU does not have a free trade agreement before exit day. – Liam Fox MP for the Independent

Ashley Fox: To get a good deal out of the EU, we need to prepare seriously to leave without one

The EU shows no sign of entering negotiations with the constructive mindset of striking an agreement with the world’s fifth largest economy. Instead it has two goals and both involve hanging onto the UK’s substantial budget payments. The first, which it now acknowledges is unlikely, is to keep the UK within the bloc. If that is not possible it wants Britain to remain in a Norway-style relationship that sees it paying for tariff-free access to the single market and accepting rules over which it has no say. To achieve this the EU needs to play for time, shifting public and political opinion by making any alternative as unpalatable as possible. Over the coming months expect to see it trying to drag out the talks to the end of the transition period. It wants the UK to face the choice of either walking away with no deal – the much-discussed cliff-edge – or be enticed further into the EU’s web with the offer of an emayxtended transition in return for further payments. – Ashley Fox MEP for the Telegraph (£)

Graeme Leach: The economy will thrive outside the EU’s protectionist tariff wall

At present, a large protectionist tariff wall surrounds the EU, with goods imported into the EU from outside subject to varying levels of tariff – 10 per cent on cars, and 20-30 per cent on certain food products. This is a tax on consumers, and the extra money paid out is money that could have been retained and saved, or spent on other goods and services. Leaving the CET would provide an immediate windfall for consumers (and intermediate producers of goods requiring imported components). It would also provide an immediate windfall for the government, which would have delivered voters an effective big tax cut and could expect a bounce in the polls in return. Of even greater importance than these immediate short-term benefits, however, is the fact that exiting the CET would generate very significant dynamic long-term advantages for the UK economy. First, it would increase competition, thereby driving up productivity in the UK economy. Second, it would improve resource allocation in the economy towards its most productive use. – Graeme Leach for City A.M.

Brexit in brief

  • Pay for single market access? We should ‘Just Say No’ – Matthew Lynn for the Telegraph (£)
  • Sneering at Brexit in the week we celebrated women’s rights is an affront to our democracy – Brendan O’Neill for The Sun
  • The City has more serious things than Brexit to worry about – Kuangyi Wei for City A.M.
  • Jacob Rees-Mogg risks harming the Brexit cause – Iain Martin for The Times (£)
  • Britons seeking European citizens’ rights after Brexit referred to EU’s highest court – Telegraph
  • EU has discussed possibility of Britain joining Efta, senior judge claims – Telegraph
  • And finally… Jacob Rees-Mogg films his toddler son trying to say ‘Brexit’ – Telegraph