Financial news

Brexit secretary raises possibility of standstill transition deal

By  | 

Britain could stay in a standstill transition deal with the EU until the end of 2022, Brexit secretary Steve Barclay has said, in a further sign that Tory Eurosceptics are softening their position to try to strike an exit deal with the EU.

Mr Barclay’s observation that the transition could be extended until December 2022 is vital because it would allow more time to reconvene the suspended Stormont assembly in Belfast to give democratic consent to any deal and to put in place new measures to avoid a hard border in Ireland.

His comments came ahead of a meeting between Boris Johnson, prime minister, and European Commission president Jean-Claude Juncker, in Luxembourg on Monday to explore the terms of the possible deal that Downing Street is now urgently seeking.

The two sides remain far apart on the substance of a deal and the EU will insist on upfront guarantees that there can be no return to a hard border in Ireland under any circumstances as part of any final deal.

Although Mr Johnson insisted in a hawkish interview that he was determined Britain would leave the EU with or without a deal on October 31, privately he has told Eurosceptic Tory MPs to prepare to back a deal at the end of next month or face the sack.

Priti Patel, the pro-Leave home secretary, told the BBC’s Andrew Marr programme nine times the government wanted an exit deal, saying “my instinct is that we have to leave and we have to leave with a deal on October 31”.

Mr Barclay, a leading Eurosceptic, also signalled the shift in tone on Sunday, telling Radio 5’s Pienaar’s Politics that a deal was looking possible and that “there is a landing zone we can see”, although that view is not widely shared in EU capitals.

READ ALSO  Saudi Aramco IPO: Company valued at up to $1.71 trillion, may top Alibaba’s 2014 record

An extended transition period could be pivotal in any agreement; it preserves existing trading arrangements and buys both sides time. Theresa May agreed in her withdrawal deal last November that the transition would end in December 2020 but it could be “a single decision extending the transition period for up to one or two years”.

Mr Barclay highlighted this provision on Sunday, saying that there was “scope for an extension by mutual consent”, suggesting that the Johnson government could be ready to accept what Labour calls “Brexit in name only” for a further three years.

It would allow extra time to develop the “alternative arrangements” — or technical solutions — that Britain claims can be used to smooth border flows and customs checks. However the EU is highly sceptical and will demand concrete guarantees that no hard border will return.

It would also allow more time to restore the Stormont assembly, suspended for almost three years, to give the people of Northern Ireland consent on the terms of a revised backstop to avoid a hard border with the Republic. Mr Barclay said October 31 was not the deadline for reconvening Stormont.

Mr Johnson has proposed keeping Northern Ireland in the single market for agriculture and food, removing the need for some health checks at the border. But EU diplomats point out that this is only a small step and that, critically, it does not address issues of customs checks, tariffs and other border controls.

Although the technical detail of a deal remains daunting — and EU officials warn that Britain has little time left to put forward legally binding, written proposals — the political desire in Downing Street to leave with an agreement on October 31 is now clear to Tory MPs.

READ ALSO  Lex in depth: Facebook — faking it

The prospect of a chaotic no deal exit has driven many moderate Tories out of the party; on Saturday former universities minister Sam Gyimah became the third former Conservative MP to join the pro-EU Liberal Democrats, who are holding their conference in Bournemouth.

The pro-Remain Lib Dems are nudging 20 per cent in some opinion polls and could damage Tory prospects in an election. However if Mr Johnson succeeded in formally leaving the EU before an election is held, it would counter the Lib Dems’ biggest political pitch.

Mr Johnson gave a typically bullish interview to the pro-Brexit Mail on Sunday in which he insisted that the UK would break free from its “manacles” like The Incredible Hulk on October 31 if he cannot secure a deal: “The madder Hulk gets, the stronger Hulk gets.”

The rhetoric is intended to reassure Tory Eurosceptic MPs that he is striking a tough position, but it has also caused concern in some European capitals that Mr Johnson is not negotiating in good faith.

One EU diplomat accused Mr Johnson of appearing “erratic” as he vows to break free of the bloc while at the same time playing up the chances of a deal. 

“His strategy seems to change day by day,” the diplomat said. “Right now we are getting a lot of aspiration from the UK negotiators and not a lot of substance or concrete proposals. It is not a constructive background to the meeting with Juncker.”

Via Financial Times

Print Friendly, PDF & Email

Hold dit netværk orienteret