Breakfast at Brussels
It seems we have something approaching a breakthrough.
Under cover of night and after hours of back and forth with the EU and the DUP, Theresa May was spirited out of Downing Street and whisked to Brussels for a second meal in a week with Jean-Claude Juncker et al. Only, unlike lunch on Monday, this breakfast was accompanied by something resembling a deal on the divorce side of negotiations. Or at least sufficient movement for the EU to declare enough progress had been made for both sides to move to trade talks.
It appears the deal includes the UK commitment to pay £40bn to meet financial commitments to the bloc and that there will be no hard border between the Republic of Ireland and Northern Ireland.
The announcement, hinted at on social media from officials on all sides overnight, is something of a victory for Theresa May who, until this morning, had frankly been having a pretty wretched Brexit week. But it would be naïve to think some significant hurdles don’t? remain.
Mrs May will face opposition within the UK, including among ardent Brexiteers, over the likely size of the divorce bill. Having one of the three Brexiteers in Michael Gove do the media rounds insisting the PM “has won” will help. But given the knives were being sharpened for Mrs May mere days ago after something approaching a debacle on Monday, it would be a mistake to think this deal firmly cements her position. Equally, the issue of the Irish border remains a very sticky one. The UK and EU have rather kicked the can down the road, and while the PM might have committed to the whole of the UK (including Northern Ireland) leaving the single market and customs union in order to keep the DUP onside, that still needs to be reconciled with a soft land border.
Oh, and that’s before you consider that the UK will remain subject to EU law but won’t be able to influence their development between now and the final leaving date. Which will thrill the likes of Nigel Farage no doubt.
But, like many a sports coach will tell you, it doesn’t matter if you win ugly, just that you win. This is a victory for the PM, and will give her a bit of respite – almost certainly staving off a leadership challenge that earlier in the week looked like it was on its way.
Excuse me Mrs May, there’s a call for you
We’ve all had it happen. You’re at lunch or dinner and the phone rings. Chances are though that the call isn’t to ask what in the world you’re doing with the Irish border.
Theresa May is finishing the week in (a qualified) victory. But on Monday afternoon, the situation was one closer to ignominy.
The PM was meeting Jean-Claude Juncker for lunch, with expectations being they would announce a divorce deal and that talks could progress to trade (subject to the agreement of Member States at the EU Summit next week). But, a call with Arlene Foster later, it was a case of no deal.
You’d have got pretty long odds if, 12 months ago, you’d placed a bet that Arlene Foster would be able to effectively stop Brexit with a phone call.
But ultimately, the PM got a deal, so does it matter?
Actually, yes. The saga on Monday demonstrated the fragility of the UK government and level of clout afforded to the DUP by Theresa May’s failure to secure a majority in June. It prompted Jean-Claude Juncker to helpfully suggest the Government could fall within weeks, and prompted talk of a leadership challenge to the PM – and either of those scenarios would simply shorten the time that ministers and civil servants have to complete an already herculean task.
So while the PM’s week is ending quite well, let’s not forget how it started. Or how the intercession of Arlene Foster is an example of the challenges for negotiations yet to come.
David Davis and the mystery of the vanishing analyses
Remember when Oliver Robbins explained that the Government’s 58 sectoral analyses of the impact of Brexit wasn’t in a suitable format for MPs? Well it turns out that format isn’t one that involves paper. Or any sort of computer files.
David Davis was up in front of the Brexit Select Committee this week, summoned to answer to rather irked committee members on why the Government was so reluctant to reduce the reports. Cue a rather strange couple of hours where a committee evidence session became something of an exercise in existentialism, with the Brexit Secretary explaining that, actually, no such analysis exists.
Not unreasonably, Committee Chairman Hilary Benn spent much of the session with a look of incredulity on his face. And the Brexit Secretary wasn’t done. His second revelation of the morning was that the impact of Brexit could be akin to that of the credit crunch and financial crisis in 2008. You know, the sort of thing you would probably want to have some form of impact assessment on.
It all begs the question, what exactly is sitting in the binders in parliamentary reading rooms for Brexit committee members?
Mr Davis’ comments will, not unreasonably, prompt further questions as to government’s preparedness for Brexit and understanding of its implications. It also raises the rather sticky question of whether someone in government misled Parliament when analyses were apparently made available. Most importantly is the question of how ministers can negotiate a successful deal if impact assessments haven’t actually been done – which is fundamental to determining what you want.
Paying your part of the cheque
Is there something in the water? What is it with Cabinet ministers and Select Committees this week?
After David Davis and the mystery of the vanishing analyses, Chancellor Philip Hammond was next up to the plate, this time in front of the Treasury Select Committee. Where he suggested the divorce bill could be around the £40bn mark (which it looks like being), but also that Britain would have to meet its financial commitments to the UK, because that’s the type of country we are.
To be fair, the Chancellor looks to be pretty much spot on in terms of the size of payment. And his point about obligation isn’t unreasonable. Would you enter into a financial arrangement with someone you didn’t think would meet their side of the deal?
Equally, the Chancellor’s comments were far from helpful to Downing Street in the context of a difficult week, and the slap down issued to Mr Hammond will do little to assuage the ire of Brexiteers happy to tear up the chequebook if Europe appears not to be playing ball. And it’s worth remembering that Mr Hammond’s own position is hardly the most secure, with speculation he could be removed had the Budget fallen into difficulty. His comments also won’t have endeared him to those within Tory ranks who would happily see a new occupant at 11 Downing Street. And with Priti Patel now on the backbenches and Damian Green under ongoing pressure, the PM could ill afford to lose another Cabinet member.
No deal for no deal
Finally, over to the House of Lords, which this week published a report from its EU Select Committee concluding ‘no deal’ between the UK and EU would be not just economically damaging but would fundamentally undermine and end cooperation on issues including security, counter-terrorism and nuclear safeguards.
The Committee also questioned whether a legally binding transition deal could be agreed in time to prevent damage to the economy, suggesting the Government might need to buy time so that negotiations can continue before the current cut-off date of March 2019.
Theresa May’s last-minute deal this morning could, would or should rule out the possibility of a ‘no deal’ scenario, but clearly questions remain over the Government’s ability to complete the job before March 2019. The Lords’ report will also do little to ease the concerns of business, which this week also demanded ministers effectively ‘get on with it.’
The week’s ending much better for Theresa May than it started, but be under no illusion about the challenges remaining.
For more information about the Brexit process and its implications, please visit https://www.whitehouseconsulting.co.uk/project-brexit/