2nd December 2016

By December 2, 2016Brexit Updates

 Top 3 Developments

  • Didn’t you get the memo? A hand-written memo, purportedly outlining the Government’s negotiating stance as to “have your cake and eat it” was pictured and widely reported, only to be immediately disowned by the Government.
  • Government readying Supreme decision The Government is preparing for the possibility of losing its forthcoming Supreme Court hearing and having to take a Bill through Parliament whilst also sticking to the self-imposed end of March deadline for triggering Article 50.
  • Bordering on uncertainty There were numerous calls for the status of EU citizens and UK citizens abroad to be protected. However, European Council President Donald Tusk and the UK Government have repeated that this issue will form part of the Brexit negotiations.

UK Update

Pro-cake and pro-eating it?

A Conservative party aide was photographed with handwritten notes appearing to reveal the Government’s Brexit negotiating stance. Based on the notes, the model for a future UK-EU relationship was to “have your cake and eat it” – possibly alluding to the UK seeking maximum access to the single market without having to make financial contributions. The memo, however, suggested that future single market access for the UK was unlikely and a deal could resemble ‘Canada plus’.

Most interestingly the memo said that senior figures within the Department for Exiting the European Union (DExEU) are “loath to do” a transitional agreement for the fear that the civil service would “hold on to it”. The leaked memo, immediately dismissed by the Government, serves to remind everybody of the difficulties of delivering a palatable Brexit to Leavers and Remainers alike and the tensions between the Government and the civil service, which are often viewed with mistrust.

A transitional agreement is purportedly an arrangement that Bank of England Governor Mark Carney wants to see, much to the chagrin of pro-Brexit ministers. Publicly, at least, Carney, like much of the business community, did call for a “degree of clarity” on the country’s approach to Brexit. These calls were repeated by the Labour Chairman of the Brexit Committee, Hilary Benn MP, who claimed that MPs were “fed up” with the lack of detail.

Cash for (single market) access

Today’s DExEU questions saw Brexit Secretary David Davis MP not ruling out the possibility of making contributions to the EU in return for access to the single market if it meant the best possible scenario for the UK.

Separate Scottish deal a no-go

Meanwhile, Welsh First Minister Carwyn Jones labelled Scotland’s desire to stay in the single market, even if the rest of the UK left, as unworkable. Indeed, the leader of the Spanish delegation of MEPs said Spain would reject such a scenario, no doubt mindful of encouraging separatist movements within Spain.

Bremain in the single market or pick cherries?

A group of cross-party ‘Remain’ MPs, including Nick Clegg, Chuka Umunna and Anna Soubry warned that ‘cherry-picking’ priority sectors for special trade agreements with the EU after Brexit would damage the economy. They called on the Government to put continued single market membership at the core of the negotiating strategy.

Parliamentary pressure on the Government continued with the Treasury Committee Chair Andrew Tyrie MP this week asking the National Audit Office to examine the financial cost to Government of the assurances given to Nissan. Those assurances subsequently led to the company announcing further investment in their Sunderland plant. All of this serves to demonstrate an increasingly vociferous Parliament and parliamentarians keen to use all the levers at their disposal to hold the Government to account.

Extra Extra! Number 10 prepares itself for media offensive

Downing Street is reportedly to begin regular briefings for London-based foreign media outlets within the next few weeks. The Prime Minister’s advisers are mindful that many EU capitals get their information from British newspapers, with stories repeated by local outlets.  Elements of the British press have come under fire for their reporting of the EU, amongst them the Daily Mail, whose publisher has today warned that the Brexit vote could harm revenue from print advertising.

Article 50 Confusion Continues

Reports emerged this week suggesting that the Government is preparing a Bill that can be taken through Parliament in just five days, if the High Court’s ruling that the triggering of Article 50 must be approved by Parliament is upheld by the Supreme Court. The news highlights the Government’s efforts to ensure that Article 50 is triggered by the end of March 2017 as previously announced by the Prime Minister. The reports broke as one of the most prominent pro-EU MPs, Nick Clegg, was recorded stating that Remain-supporting MPs would not be successful in their attempts to block the triggering of Article 50 and as Scotland’s top lawyer wrote to the Supreme Court requesting that Holyrood must also consent before the mechanism is triggered.

A further potential stumbling block in the Government’s Brexit plans also presented itself as the most senior British member of the European Court of Justice (ECJ) stated that the ECJ has “ultimate authority” over the triggering of Article 50, adding that the Supreme Court may refer the soon-to-be-heard case to them. Advocate General Eleanor Sharpston QC added that the Court may take between 4-8 months to make a ruling if it was referred to them. However, she did confirm that the ECJ would not intervene in the Supreme Court’s ruling if it did not choose to refer the case to the European body.

Bordering on uncertainty

The status of EU citizens and UK ex-pats living abroad was the subject of much debate this week, with MPs and European leaders expressing their views on the issue. Following Polish Prime Minister Beata Szydło’s comments that migrants should not be treated as hostages, Shadow Brexit Secretary Keir Starmer urged Government to pass legislation which would protect EU citizens’ rights or risk souring Brexit negotiations.

Echoing this sentiment, 80 MPs wrote to Donald Tusk calling for an end to the ‘anxiety and uncertainty’ both for EU citizens and for British expats living in European countries. Tusk, however, responded that it was the British public, not EU leaders who had created the ‘anxiety’ whilst also hitting back at claims that Michel Barnier was ‘indifferent’ to securing reciprocal rights. He stressed that the best way to secure the rights of citizens was for the UK to trigger Article 50 and begin negotiations.

However, despite these interventions, and alleged comments from Boris Johnson that he believed in freedom of movement, Government have reiterated their position on the issue that the status of EU citizens will remain part of negotiations.

Goldsmith upset in Richmond

The Liberal Democrats have unseated Zac Goldsmith in Richmond Park, overturning a 23,000 majority to remove the former Conservative MP in a vote that became centred on the Government’s Brexit plans. The former Richmond MP resigned his position following the Government’s decision on Heathrow, however, the Liberal Democrats’ Sarah Olney was able to base the argument around Brexit, arguing that one of the most strongly pro-remain constituencies in the country should have a say on being represented by a leave supporting MP.

European Update

Europe divided over transitional Brexit deal

Irish Prime Minister Enda Kenny believes the UK and EU will not be able to agree a deal in the allotted two years after Article 50, therefore supporting a transitional deal. The UK/Ireland border is one of the most sensitive Brexit issues and both Governments want to retain current arrangements.

Malta, who are set to assume the next EU Council Presidency, has said the ‘border issue’ needed settling before Brexit talks could begin. The EU is divided on whether a transitional period of phased withdrawal is a good step, with Luxembourg Prime Minister Xavier Bettel opposing saying ‘you’re either a member or not’ and a single permanent deal should be reached. Commission negotiator Michel Barnier also agrees, saying that he opposes a transitional deal where Britain will get some market access without the obligations.

EU leaders: No negotiation without notification

Away from the question of the transitional deal, more EU leaders repeated their stance on Brexit.  Angela Merkel and Donald Tusk have rebuffed Theresa May’s proposal for an ‘amnesty’ and guarantee of rights for British ex-pats and EU migrants in the UK. This, together with Tusk’s response to the letter from MPs on EU citizens and UK expats’ rights, reiterates EU leaders’ stance that substantive discussions will not take place until Article 50 is triggered.

May Polishing up London-Warsaw relations

Theresa May hosted the Polish Prime Minister Beata Szydło in Downing Street this week. Both agreed the importance of an early resolution on the status of the 900,000 Poles in Britain and Szydło said Brexit negotiations will be ‘interesting’, while May said Brexit will act as a catalyst to strengthen British Polish ties. Aside from Brexit, May said she will send a detachment of 150 British troops to Poland to ‘deter’ Russian aggression and confirmed a series of joint programmes on growth, technology and cyber security.

Au-Revoir Hollande!

French President Francois Hollande confirmed he will not be stand for re-election next April. He has been polling in single figures recently and has been under considerable pressure form his own party to step aside as he was certain to lose in the election next April. His decision now means the Socialists need to find an alternative candidate with Prime Minister Manuel Valls the obvious choice, although they still face a huge battle to even get to the second round of the election.

Mamma mia! Italy could lose its Prime Minister

Italian Prime Minister Matteo Renzi is on course to lose his referendum and possibly his job this weekend thus leading to further uncertainty around Brexit. The referendum was called by him to stop the Italian Parliament upper house (Senate) blocking his policies and will curtail their powers, but the ‘no’ vote is polling 10% ahead which could see Renzi resign. Opposing him is the populist anti-establishment Five Star Movement, and if Renzi’s resignation leads to elections they could end up helping form the next Government.

Timeline

·         5 December Article 50 ruling appeal starts

·         7 December Exiting the European Union Committee evidence session

·         15 December Next EU Council Summit

·         March 2017 Article 50 to be triggered