New books reveal divisions behind EU referendum campaign
The Sunday Times included extracts from the new book on the referendum by its Political Editor Tim Shipman, which suggested that current Prime Minister Theresa May and Chancellor Philip Hammond failed to back former Prime Minister David Cameron’s line of pushing for an emergency brake on EU migration once it had been rejected by German Chancellor Angela Merkel. The lack of support led to Cameron calling his cabinet colleagues “lily-livered” according to Shipman and was one of the motivating factors behind the decision to focus on benefits rather than numbers.
Similarly, the Mail on Sunday began the serialisation of an upcoming book on the referendum by Sir Craig Oliver, formerly Director of Communications at Number 10, in which he states that May was dubbed “submarine May” for her refusal to fully back the Remain campaign. Oliver accuses May of “playing games”. Oliver also suggests that Foreign Secretary Boris Johnson believed the Leave campaign, which he helped lead, would lose the referendum and vacillated over whether to support it or not until just before he declared. He describes former Justice Secretary Michael Gove as a “suicide bomber” for reversing a pledge to remain loyal to Cameron.
This morning May’s camp have hit back at the claims and have released private correspondence between May and Cameron which reportedly show her lobbying for an emergency brake on migrant numbers. The BBC reports that May send Cameron letters in November 2014 and May 2015 to argue for the measure.
Separately, Foreign Secretary Boris Johnson said on the BBC’s Andrew Marr show that the Government will not trigger Article 50 before Christmas but that the process should “not drag on” much after that. A new ComRes poll found that 50% believe the exiting process should start “as soon as possible”, while 37% said the government should take more time.
Sources: The Sunday Times, The Sunday Times, Mail on Sunday, The Independent on Sunday, BBC
Fox speech at WTO expected to pave way for UK to leave customs union
The Sunday Telegraph reported that Secretary for International Trade, Liam Fox, will give a speech on Tuesday at the World Trade Organisation, which is expected to set the UK on the path towards leaving the EU’s customs union. Meanwhile, John Holland-Kaye, Chief Executive of Heathrow, has warned that leaving the customs union would add “massive overhead” for businesses and port operators. Ministers have reportedly ordered civil servants to come up with ways to cushion the impact of leaving the customs union, including hiring hundreds of customs officials.
Sources: The Sunday Telegraph, The Financial Times
Labour expected to unveil pledge to guarantee EU funding into 2020s and beyond
Shadow Foreign Secretary Emily Thornberry is today expected to announce a Labour pledge to maintain funding which regions receive via the EU post-Brexit. Thornberry will say that, while the Government has pledged funding up to 2020, “For the period after, they have said nothing. That is not good enough. She will add that Labour “can guarantee that a future Labour government will make up any shortfall in structural funding into the 2020s and beyond. And the same will go for the funding of peace and reconciliation projects in Northern Ireland.”
Meanwhile, Jeremy Corbyn has been re-elected as the leader of the UK Labour Party and vowed to “wipe the slate clean.” Corbyn obtained 61.8% of the vote to Labour leader challenger Owen Smith’s 38.2% (313,209 to 193,229 votes) – a larger mandate than last year. Speaking on BBC’s Andrew Marr show yesterday Corbyn warned against a hard Brexit which he said would damage manufacturing jobs and once again voiced his support for free movement of people but stopped short of saying the UK should stay in the single market.
Sources: The Guardian, The Times, Reuters
City of London concerned UK leaning towards leaving customs union and single market
The Financial Times front page reports that the City of London is getting increasingly concerned that the Government is leaning towards a “hard Brexit”, which the article defines as leaving the customs union and the single market. Separately, according to a survey by KPMG, three quarters of chief executives are considering moving some operations overseas in the wake of the vote to leave the EU. The survey also found that 69% of the executives expect the UK economy to continue to grow next year and 73% expect their own businesses to grow.
According to data collated by the Financial Times, “Banks that use the UK as a gateway to the EU employ more than 590,000 people, have more than £7.5tn of assets and make annual profits of more than £50bn.”
Over the weekend the Telegraph reported that a number of US banks and investors warned in a meeting with Prime Minister Theresa May that there will need to be “early clarity” on the new relationship with the EU in financial services to avoid some business having to move to Europe.
Sources: The Financial Times, Bloomberg, The Telegraph
Hopes of concluding EU-US trade diminish as EU tries to finalise CETA
Following an informal meeting of trade ministers in Bratislava, EU Trade Commissioner Cecilia Malmstroem said “If we haven’t finished [the EU-US trade] negotiations by 19 January, there will be a natural pause…When we re-start is a bit early to speculate.” Slovakia’s minister of economy Peter Ziga added “We had a discussion on the state of play of negotiations and it ensued that it’s not realistic to complete the talks before the end of the year”. This follows comments from Austria’s Vice-Chancellor Reinhold Mitterlehner who said TTIP talks should be called off after the US elections and resume under different name.
Meanwhile, EU ministers are likely to hold an extraordinary meeting on October 18, to produce a binding declaration spelling out the limits of the EU-Canada trade deal (CETA) to dismiss public concerns, and allowing CETA to be signed during the visit of Canadian Prime Minister Justin Trudeau to Brussels on Oct. 27. It could provisionally enter force early next year. Germany’s Vice-Chancellor Sigmar Gabriel said “There was a great willingness to sign the agreement in October.”
Separately, Germany’s Constitutional Court will rule on October 13 on a complaint by activists aimed at stopping the EU-Canada trade deal. Three German groups handed in 125,000 signatures to the court in August to try and scupper the Comprehensive Economic and Trade Agreement (CETA), which opponents fear will undermine workers’ rights and environmental and consumer standards.
Sources: EUobserver, EUobserver 2, Reuters, Reuters 2
France and Germany reject view that single market is not linked to free movement
Speaking at a joint news conference with Wolfgang Schäuble, German Finance Minister, Michel Sapin, French Finance Minister, said: “If we want to make good European pate, then there are four freedoms that together make up the pate”. Schäuble added “If we need to do more, we will gladly send Her Majesty’s Foreign Minister a copy of the Lisbon Treaty. Then he [Foreign Secretary Boris Johnson] can read that there is a certain link between the single market and the four core principles in Europe.”
Sources: Reuters, EUobserver
Schulz: Brexit deal with free trade but no free movement will be vetoed
President of the European Parliament Martin Schulz has said MEPs in Brussels will veto any Brexit deal that lets Britain export its “lorries and hedge funds” to the EU while preventing free movement. He added that the EU was a “community” not an “accountants club” and that the best possible deal with the EU is membership of the EU. Any other arrangement . . . entails trade-offs.” However he insisted “The institution I preside [over] is tackling Brexit in a level-headed and fair manner without the slightest hint of retaliation.”
Separately, responding comments by Secretary of State for Defence Michal Fallon that the UK would veto the creation of an EU army, Schulz said the idea to block would be “counterproductive and anyway not possible in this case.” He added “[I’m] not sure how seriously to understand the threats of U.K. vetoes” and urged London to “end this systematic talk of blocking” if it wants to “reset” its relationship with the EU.
Sources: The Times, Politico
Spanish regional elections deal a blow to socialist hopes of unity
The Spanish Socialist Workers Party (PSOE) has performed poorly in two key regional elections in Spain. Pedro Sánchez, the PSOE leader, had hoped for a strong result to unify his party and bolster his bid to form a new government without the acting President Mariano Rajoy from the conservative Popular Party (PP). However, in Galicia in the north-west the PP beat the PSOE into second place with 45.7% of the vote against the PSOE’s 20.5% with almost all votes counted. In the Basque Country in the north-east, the Basque Nationalist Party (PNV) was the largest party on 34.6% of the vote, with the PSOE third on 19.1%. This will harm Sánchez’s bid to form a coalition government to end the country’s ongoing search for an administration capable of holding power.
Sources: Expansión, El País, El Mundo
Head of London Stock Exchange warns of a loss of 100,000 jobs post-Brexit
Xavier Rolet Head of the London Stock Exchange has told Bloomberg that 100,000 job could be put at risk if the UK loses the ability to clear euros once it leaves the EU. However, Rolet also suggested that New York may be the main beneficiary rather than any EU cities. Separately, according to a report by the Institute of Public Policy Research (IPPR) job vacancies in England’s financial sector have fallen more than 10% after the Brexit vote over passporting and single market fears.
Sources: The Guardian, BBC, IPPR: Brexit and the UK Labour Market
German MPs call for accelerating citizenship applications for Britons
The German Green party has called on Angela Merkel government to fast-track the applications of Britons wishing to become German citizens in the light of the UK’s vote to leave the EU. Volker Beck, a leading member of the party, told the Bundestag that Germany should “send a signal that Britons belong to Europe and to Germany” by allowing the “swift and straightforward naturalisation” of British citizens.
Source: The Guardian
Osborne warns against hard Brexit but suggests concerns over sovereignty must be recognised
Speaking at the Chicago Council on Global Affairs, former Chancellor George Osborne warned UK Prime Minister Theresa May that “Brexit won a majority. Hard Brexit did not.” He also said he did not believe the EU would be in “any position to conduct serious negotiation” until autumn next year once the French and German elections are out of the way.
Osborne also said, “There are lessons to be learnt across the political spectrum. Those who, like me, frankly underestimated public concerns about sovereignty need to think hard about how we can give people a greater say about the decisions that affect them and their community. My feeling is that the answers go deeper than simply repatriating decisions from Brussels to Westminster – that people sense there are forces beyond their control that are driving their lives, from remote government to technological change, and that makes them feel insecure.”
Sources: The Chicago Council: Osborne, The Guardian, The Times
Next summit on post-Brexit reforms between EU-27 leaders to be held in February 2017
According to AFP an EU source has said the 27 EU leaders, excluding the UK, will hold their next summit on post-Brexit reforms in Valetta on 3 February 2017.
Source: EUobserver
Cameron’s former Chief of Staff appointed as new UK Ambassador to France
Ed Llewellyn, former Chief of Staff to former Prime Minister David Cameron, will replace Sir Julian King, who has recently been appointed as the UK’s European Commissioner, as the UK’s ambassador to France.
Source: Foreign & Commonwealth Office: Llewellyn
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