Prime Minister Theresa May’s Brexit speech today from Mansion House, London, was billed as her biggest Brexit announcement since her Florence September 2017 speech, when she said she wanted a two year transitional period from day one of Brexit (WikiTribune).
Commentators say she was tasked with delivering a realistic Brexit vision, beyond the UK having its cake and eating it, and the Secretary of State for Transport, Chris Grayling, had even warned May would recognise in this speech that Brexit “is not about cherry-picking.”
Today she set out five tests for any Brexit deal, but provided little detail despite her and 11 senior ministers preparing for this speech at an eight-hour Brexit discussion at the PM’s country retreat a week ago.
She said she didn’t want a hard border between Northern Ireland and the Republic of Ireland but offered no new proposal, implying she hasn’t changed her mind that Northern Ireland shouldn’t be part of any customs union, which risks peace according to some political commentators (The Guardian).
This is after Labour leader Jeremy Corbyn, recently announced that Labour supports the UK being in ‘a’ customs union. However, even if May continues to plan Northern Ireland’s future without a customs union, Remain-supporting Conservative MPs, Anna Soubry and Ken Clarke’s recently proposed amendments that the UK remains in some sort of customs union, could mean she is defeated on this (Financial Times).
After rejecting the EU’s draft Brexit treaty, European Council President Donald Tusk had told her she needed to come up with a “better deal” during her meeting with him yesterday.
The draft Brexit treaty was released on Wednesday, and reconfirmed the EU’s position (first reported by the FT) that the only way to avoid a “hard border” between Ireland and Northern Ireland, and preventing risking undermining the Good Friday peace agreement, is to keep Northern Ireland in the customs union and the single market. It also said the UK would be bound to UK-EU court rulings into the 2030s and beyond; and questioned whether the British Overseas Territory of Gibraltar would be covered by a transition deal (Financial Times).
Here’s what Theresa May had to say today:
Key points from May’s speech:
- “We are leaving the single market, life is going to be different.” She said the UK would not be part of the digital single market after Brexit either (The Guardian). However, she said Brexit will reduce access to the single market in “some respects,” implying she plans the UK will still have some access to it. But the EU has said no “cherry picking on single market” so freedom of movement which May is against, would have to continue.
- She said there will be no hard border in Ireland after Brexit but offered no new solutions. She referred only to two alternative proposals for customs arrangements with the EU, set out in a government paper last summer (The Guardian).
- Reconfirmed previous position that the “jurisdiction of the European Court of Justice in the UK must end” but said EU legal decisions would continue to affect the UK after Brexit (The Guardian).
- UK will make binding commitments for regulations to remain in step with EU ones in some areas. “We may choose to commit some areas of our regulations like state aid and competition to remaining in step with the EU’s.”
- Wants freedom for UK to negotiate its own trade deals with EU but Brexit treaty guidelines say this isn’t possible.
- Doesn’t want to lower standards for goods but there has to be an agreement on customs which allows the UK to not abide by the EU’s common external tariff (The Guardian).
Reactions (To be added)
- Leader of the DUP – Arlene Foster’s party, which is propping up Theresa May’s Conservative government via a supply and confidence arrangement, and is therefore key to May staying in power, welcomed the speech, saying: “I welcome the prime minister’s clear commitment that she will not countenance any new border being created in the Irish Sea between Northern Ireland and the rest of the United Kingdom.” (The Guardian)
- Institute of Directors – Leader of the UK business organization, Stephen Martin said: “Her acknowledgement of the need for new labour mobility arrangements will also strike a positive chord with businesses…we are glad to see her refer to the importance of new cooperation mechanisms that will underpin the trust in each other’s regulatory frameworks… It was also welcome to hear an explicit reference to continued participation in EU regulatory agencies such as the European Medicines Agency.” (The Guardian)
Time is running out
The UK now has just over one year left to negotiate a deal with the EU after May triggered Article 50 in March 2017. However, European Chief Negotiator for Brexit Michel Barnier, has said the Article 50 deal will have to be negotiated by October 2018 to give the European Parliament time to vote on it. This would leave the UK with seven months left to agree on a final Brexit deal.
If after March 2019 ‘no deal’ is reached the UK will automatically revert to World Trade Organisation (WTO) trading rules, unless the EU agrees to the UK’s proposed two year transitional period. WTO rules would mean the UK would have to pay tariffs on goods and services it exported into the EU. According to recent government impact analysis by officials for the Department for Exiting the European Union, a ‘no deal’ arrangement would result in 8 percent lower economic growth for the UK. It is not clear whether the UK will still be able to negotiate its Brexit deal in any agreed transitional period to avoid such a scenario.
Comments before Speech
- Scotland’s First Minister Nicola Sturgeon said on Twitter the PM’s speech “must set out exactly how she intends to achieve her – seemingly contradictory and unachievable if we leave single market/customs union – objectives” after she rejected the UK government’s latest proposal, over what powers currently exercised by the EU would return to Holyrood.
- Political Editor of ITV News, Robert Peston, posted on Facebook, Theresa May’s biggest challenge today was to “persuade the rest of the EU that her ambitions are consistent with EU lore and law AND would be approved by the UK’s parliament … It will be horrifically difficult for her.”