The UK and Europe
May's looming Brexit crunch time
Andrew Grice / Jan 2018
In London, the politics of Brexit resembles Groundog Day. Theresa May refuses to spell out what long-term relationship she wants the UK to have with the EU. That leaves a vacuum, which is filled by the pro and anti-EU factions in her Conservative Party. Their dispute extends to the highest level of her Cabinet. Brexiteer MPs grumble about Philip Hammond, the Chancellor, because he wants to maintain close EU links until the benefits of trade deals with other countries can be guaranteed. Pro-EU Tories accuse Boris Johnson, the Foreign Secretary, of freelancing as he sets out his own “red lines” and demands a “clean break” with the EU, in effect arguing that a soft Brexit would not be a real Brexit.
All this happened last autumn and, ominously for May, history has repeated itself at the start of 2018. A Cabinet reshuffle, in which she originally planned to move Both Hammond and Johnson, left them both in place. The Prime Minister may now regret her caution.
Hardline Brexiteers sniff a “sell-out”, warning that the UK is heading for “Brino” – Brexit in name only. They fear the mooted two-year transitional period from March next year will become indefinite, leaving the UK in a worse position than as an EU member, as it would have to swallow EU rules without having a say over them.
The sense of optimism after the stage one Brexit deal in December has already disappeared. It is no longer certain that May will survive long enough in Downing Street to complete the Brexit negotiations due to be concluded by October. Eurosceptics fear she is closer to Hammond’s position than Johnson’s, while other Tory MPs complain she has no domestic policy agenda or is simply incapable of doing her job. That forms a dangerous cocktail for May. There is growing speculation at Westminster that required 48 Tory MPs will soon trigger a vote of confidence in her as party leader. This time it might well happen – either soon, or after the local authority elections in May, when the Tories face a drubbing.
Remarkably, 19 months after the referendum, the UK Government still does not have a vision for the “end state.” Ministers talk tentatively about “gradual” or “managed” divergence from EU regulations. But a big speech by May to put flesh on the bones, due in February, has been put on hold because there is no Cabinet agreement.
A 10-strong Cabinet sub-committee chaired by May is thrashing out a compromise, but so far has mainly discussed the transitional agreement, in the hope that EU leaders sign it off at their March summit. Understandably, there is growing impatience in Brussels, and concern that the momentum of December’s breakthrough has been lost. EU leaders rightly believe the onus is on London to spell out what it wants from a trade deal, insisting they cannot make an offer until they know what the UK has in mind.
However, UK ministers do spot one silver lining. They are encouraged by noises from countries including Poland, Ireland and Italy that the bespoke trade deal sought by May might be possible after all. Emmanuel Macron, the French President, did not rule out the idea during a visit to Britain. UK ministers detect that the EU may be preparing to soften its offer of a binary choice between the “Norway or Canada model”, in the hope that continuing payments by the UK would partially fill the hole in the EU budget caused by its departure. But the UK Government’s hopes to “divide and rule” as countries such as the Netherlands, Ireland and Belgium seek to maintain their close trading links with Britain may prove wishful thinking, just as they did in phase one of the negotiations.
It is make your mind up time for May. Both her own party and the EU need to know what she really wants Brexit to mean. If she does not say so soon, time will be running out for a deal, and Tory MPs may take matters into their own hands.