May's Brexit Plan Starts to Take ShapeBy
Sunday Telegraph: U.K. will pay 40 billion euros to leave EU
Position papers on customs union and borders in coming weeks
The U.K. is starting to get specific on its Brexit plan.
For the first time, a figure has surfaced of what Prime Minister Theresa May is willing to pay to settle the so-called divorce bill, as details also emerge of the kind of transitional arrangements the government will seek ahead of a third round of talks with European Union negotiators later this month.
The Sunday Telegraph cited three government officials it didn’t identify as saying Britain would put 36 billion pounds ($47 billion) on the table in a bid to push the discussion toward a future trade deal. Even though Brexit Secretary David Davis told the Sunday Times that the report was “news to me,” the story details a degree of behind-the-scenes bartering, with the figure, equal to 40 billion euros, seen as a compromise between what the EU wants and the U.K.’s starting position.
The government department responsible for Brexit talks declined to comment, while a commission official said the EU’s executive arm wouldn’t speculate on rumors. The official also noted that Michel Barnier, the EU’s chief negotiator, has explained on several occasions that the financial settlement covers all commitments made by the U.K. as a member of the bloc.
There’s been a shift among May’s cabinet, including the ardent Brexit supporters, to a view that a transition period is unavoidable. The problem has been over how long this should last -- with Chancellor of the Exchequer Philip Hammond envisioning a period of three years -- and whether the free movement of people should be allowed to continue in the interim.
Former Bank of England governor Mervyn King told BBC Radio 4’s Today program over the weekend that the government “probably wasted a year” and that no Brexit deal was “not the first preference of anybody.”
Clarity will emerge as the government gets ready to release a series of position papers, which will provide the strongest clues so far on how much May is willing to compromise and show whether her Brexit vision has indeed softened.
Politico reported that in one paper, the U.K. will seek a transitional customs agreement with the EU. In a second it will outline its solution to the Northern Ireland border as it charts a smooth route out of the bloc.
Politico cited senior officials as saying the government sees the two issues as inseparable and wants them and the rights of EU citizens resolved as part of a big push to pivot talks to trade. The government will publish as many as 12 position papers over the next two months, ahead of a summit of EU leaders that will be a forum to untangle stubborn sticking points.
“At the center of government, meanwhile, there has been a shift in the balance of power,” Vince Cable, the leader of the pro-EU Liberal Democrats wrote in the Mail on Sunday. “The grown-ups, led by the chancellor and business secretary, have been seeking to postpone Brexit for three years, keeping the full discipline of the single market, to give our companies time to adjust.”
A research report published in the Financial Times showed that two-thirds of the country’s largest public companies are more worried about political risk since May’s Conservatives lost their parliamentary majority in the June election. Back in December, the FT–ICSA Boardroom Bellwether survey showed concern among FTSE 350 companies at 40 percent.
May has made more of an effort to reach out to the world of business, which has been feeling stressed about the uncertain environment as the clock ticks down to March 2019, when the U.K. formally leaves the EU. Company executives have been ardent advocates of the kind of transition the government is gravitating toward.
Nick Timothy, once one of May’s closest confidantes, resurfaced after resigning over the election fiasco to warn against reading too much into any softening in May’s Brexit thinking. “If you strip out the noise,” including Hammond’s comments about a transition period, he said the prime minister’s strategy is the same.
“For all the talk from some people that we must seek some sort of partial membership of the European Economic Area or something like that, the intention of the government has been clear from the beginning,” Timothy told the Daily Telegraph.
And that is: “If you seek a partial relationship the danger is that you will be in the worst of all worlds, where you will be a rule-taker with none of the advantages of being in, but you will also sacrifice some of the advantages of being out.”