Morning briefing: Chequers mates - budgetary blow ups - workers (and bosses) unite!
If you throw a toad into boiling water, it jumps out and lives. If you put the toad in warm water and gradually turn up the heat, the change in temperature is never big enough to get the lazy beast to jump out - and it dies.
Theresa May is gearing up for the next phase of her scheme to boil Brexiters in her Cabinet like toads. She has summoned the entire Cabinet to a meeting at Chequers next Friday rather than just the inner “war” Cabinet. Presumably this is because she thinks she’ll then have a clear majority over hard Brexiters such as Boris Johnson and David Davis whereas she lost that majority in the war Cabinet after Amber Rudd resigned in April and was replaced by Sajid Javid.
The prime minister seems to want to get Cabinet to agree we should stay in the EU’s single market for goods post Brexit. She then wants to publish a White Paper setting out the government’s policy the following Monday, July 9, according to The Times.
If the EU agreed such a proposal - see more on this below - it might help resolve the Irish border issue. Manufacturers such as Airbus and BMW, which have been warning they might have to pull out of the UK, might also be satisfied. But the proposal would involve following the EU’s rules on goods and possibly joining the European Free Trade Area (EFTA) court, according to a separate report in The Times. The Brexiter toads would find the water temperature rising.
The snag is that a single market in goods wouldn’t do anything for our services industries, which account for four fifths of the economy. That’s why Greg Clark is pushing for them to be included in the proposal. He has even proposed “labour mobility” with the EU - something that sounds suspiciously like free movement of labour - to get the EU to agree. If the business secretary ever got his way - another big “if” - the toads would be really feeling the heat.
HAVE YOU SIGNED THE PETITION FOR A PEOPLE'S VOTE? NEXT STOP 200,000!
But even if the prime minister gets her more modest single market for goods through Cabinet, she won’t have a deal. She’ll just have a proposal. Although cracks within the EU are emerging over the idea - with some countries more open to it than the European Commission - Spain has already explicitly stated its opposition to the proposal and claimed that France and Germany are also opposed. It appears to be dead before it’s even been agreed by the UK Cabinet.
It seems therefore that May will have to make at least three more adjustments before it is a runner:
- Customs. May seems to want to go ahead with the “maximum facilitation” scheme the EU has already rejected. A customs union is probably the only viable option - meaning we wouldn’t be able to pursue an independent trade policy.
- Money. It’s hard to see the EU letting us stay in the single market for goods unless we pay into its budget - without a say on how it is spent.
- Unfair competition. The EU will want to ensure our companies don’t get an unfair advantage by slashing social and environmental rules or subsidising our industries. It will insist we follow its rules on all these things - without a vote on them.
May isn’t remotely ready to agree any of this yet. But she’ll need to if she wants a deal. Over the coming months, expect her to make one concession after another - gradually turning up the heat on the toads.
It won’t just be the Brexiters who are unhappy. Such a deal wouldn’t please many pro-Europeans either. All the more reason for a People’s Vote on the final deal.
Quote of the day
“... a theoretical exercise in which you take decisions over the lives of people in imagined worlds.”
Business secretary Greg Clark’s assessment of what the Brexiters are up to.
Video of the day
Labour's Geraint Davies weighs up the Brexiters' fantasy trade programme versus the reality of the EU's new deal with Japan.
Brexit means budget rows - because there is no money!
The budget rows in Cabinet continue, with Gavin Williamson demanding an extra £4 billion a year in defence spending, reports The Times. It follows pledges of £20 billion to the NHS last week.
Get used to these budget rows if the UK leaves the EU. They are a symptom of Brexit, for the simple reason that Brexit means much less money in government coffers. This was underlined again today in a report by the public accounts committee, which stressed that May’s “Brexit dividend” for the NHS doesn’t exist. It also calculated that the Brexit divorce bill could be £10 billion more than the government’s £39 billion figure.
Brexit means cash-strapped ministers squabbling over money that doesn’t exist for as far as the eye can see.
Tweet of the day
Unions and business unite against May’s Brexit
The TUC and CBI have issued a rare joint statement calling for more “pace and urgency” and “measurable progress” on Brexit. They will be disappointed at tomorrow’s EU summit, which Theresa May’s time-wasting has ensured will be a write-off as far as Brexit is concerned.
Both bodies - one representing workers, the other employers - are still calling for an EU withdrawal and transition deal which puts “economic interests and people’s jobs, rights and livelihoods first”.
No one has made a Brexit proposal that would not be bad for jobs, trade and investment. So it’s time unions shifted to the next logical argument: if workers don’t like the threat Brexit poses to jobs, then there should be a People’s Vote on the final Brexit deal.
Video of the day 2
Pat McFadden MP outlines the miserable Brexit economy on Sky News.
Time to think about extending Brexit talks?
Brexit talks are “drifting” and the Brexit clock is ticking. We should therefore plan now for the possibility we’ll need to extend the March 2019 deadline, Tony Blair will say in a speech today.
The EU Withdrawal Act, passed yesterday, has written the Brexit date of March 29 2019 into law. But extension is still possible - though it would need the agreement of the UK government and all 27 other EU members. Blair says Parliament should “assert itself” and pave the way for a People’s Vote. Quite so.
More Brexit news…
Top Brexit comment
Alena Ivanova: Most of Labour is pro-Corbyn and anti-Brexit – we must be heard (Guardian)
Nils Pratley: Brexit ministers need to put facts before ideology (Guardian)
Eve Alcock: EU Referendum: A tale of love, loss and desperation (Bath Time)
Today, Wednesday 27 June
|-||BMA annual conference to debate Brexit|
|-||Tony Blair speech at Chatham House "in defence of globalisation"|
|12:00||Prime Minister's Questions|
|PM||Speech by CBI's Carolyn Fairbairn at annual summer lunch|
|14:15||Experts give evidence on EU Withdrawal to European Scrutiny committee|
Tomorrow, Thursday 28 June
|-||European Council summit|
|09:30||ONS: Internal migration by local authority|
|09:30||ONS: UK population estimates|
|19:00||England v Belgium in World Cup|