Theresa May was back from her holidays this week – though not quite back in the hotseat. Nevertheless, her government was busy preparing for the next round of Brexit talks due to start on August 28. Cabinet rivals Philip Hammond and Liam Fox, in a joint Sunday Telegraph article, even appeared to bury the hatchet in their squabble over a transition period. But how long can the semblance of order last?
Assuming the position
This week’s Brexit agenda was dominated by the publication of two government position papers, one on future customs arrangements and one on the Irish border.
Tuesday’s customs paper offered a choice of two proposals: a highly streamlined arrangement making customs procedures as simple as possible; or a system whereby the UK would mirror the EU’s requirements, but only for imports eventually destined for the single market. The government admitted the second approach was “innovative and untested”. The European Parliament’s Brexit negotiator, Guy Verhofstadt, called it “fantasy” and Labour’s Keir Starmer called it “incoherent and inadequate” – although his own party faced some difficult questions on its own customs position. Others, such as the National Farmers Union, welcomed the proposal for a temporary EU-UK customs union before a final deal is struck.
On Wednesday the focus was on Ireland. The government’s primary goal is to maintain the “invisible and seamless” border, with specific plans to ensure no customs checks or immigration controls. The European Commission welcomed the proposals as a “positive step” but warned a “political discussion” was needed before “looking at technical solutions”. Ireland’s foreign minister agreed with the need for an “invisible border”, although he also pointed out that this “is what we have at the moment”. Indeed, none of the government’s suggestions are as favourable as the current situation within the EU.
The economy
There’s been a mixed bag of economic figures this week. Retail sales grew, but only due to strong food sales; the purchase of other goods fell. Unemployment continued to decline while wage growth started to edge up. Consumer price inflation was unexpectedly stationary at 2.6%, though that will be little consolation for rail passengers, who can expect ticket prices to shoot up in the new year. That’s because regulated fares are linked to the retail price index, which jumped 3.6% in the year to July.
Over in the City, top recruitment firm Morgan McKinley said the UK’s finance sector was “haemorrhaging talent because of Brexit” and there was a risk of losing jobs. Meanwhile, the Corporation of London’s Asia team said the commitment of Asian countries to London “remains unwavering” but the City must move swiftly after Brexit to “ensure they view London as their number one partner in the west for financial and professional services”.
On a hoppier note, Belgian brewers are taking the plunge into the UK’s booming beer market in spite of Brexit.
Brexit for all ages
The first A-level results since Michael Gove’s reforms were announced on Thursday. While the number of top grades has risen for the first time in six years, the number of confirmed university places is down – even at prestigious Russell Group institutions.
The universities anticipated this before results day because they face the twin problems of a demographic drop in British 18-year-olds and a significant fall in applications from EU students. Many are poised to lower entry requirement standards to fill courses.
Students’ grandparents seem to be rushing to retire on the continent before the Brexit drawbridge is pulled up. One company that supports Brits retiring to the mainland revealed that the number of monthly inquiries to its website had doubled in a year, while actual business was up by 25%.
What other people have been saying
James Chapman, the former David Davis aide, has proposed a new anti-Brexit party, claiming two Cabinet ministers have “been in touch” about the idea. Chapman followed up with a Twitter tirade against his former boss, saying the Brexit secretary has “been working a three-day week since day one”. InFacts examined whether talk of a new party is silly or serious.
Elsewhere, people are looking beyond Brexit. The Local Government Association has called on ministers to use Brexit to cut red tape that can “stifle” local councils. Meanwhile, the prime minister of Norway has cast doubt on the idea of Britain’s temporary membership of the European Free Trade Agreement (EFTA), potentially limiting the government’s options for a transitional arrangement.
It’s all academic anyway, because Vince Cable reckons “unravelling” politics and “sheer practical difficulties” make it a “significant possibility” Brexit doesn’t happen at all. It seems more uncertain than it ever has since the referendum. As InFacts Chairman Hugo Dixon wrote in the Financial Times this week, now is the time for pro-Europeans to “put their heart into stopping Brexit rather than campaigning for a soft one”.
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Edited by Alan Wheatley
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