This article is from the source 'guardian' and was first published or seen
on .
It last changed over 40 days ago and won't be checked again for changes.
Theresa May’s third big speech on Brexit had to do two things. First, the prime minister had to give the EU enough on the main points of the stalled article 50 talks – including the vexed question of a financial settlement – to unblock them, but not so much as to antagonise the Eurosceptic hardliners in her cabinet and parliament.
Theresa May’s third big speech on Brexit delivered clarity in some areas, but none in many others. It could have done just enough to unblock the stalled divorce talks – but maybe not to allow them to move on to the future relationship next month.
Secondly, the EU27 wanted clarity on the UK’s plans for a transition period out of the bloc, and some indication of what workable form Britain would like the future relationship to take that does not look like a bid to keep the rights of EU and single market membership while shedding the obligations.
The EU27 wanted promises on money and the other key article 50 points, citizens’ rights and the Irish border; detail on the transition period; and a feasible vision of what Britain wants its future trading relationship to look like.
So how did the prime minister do?
So what did we learn – and what didn’t we?
Money
There will be a “status quo” transition period
As expected, the prime minister offered to pay enough into the EU to ensure that no member state would have to stump up more (or receive less) during the current budget round that ends in 2020.
Britain wants a transition period aimed at bridging the gap between leaving the EU in March 2019 and beginning the new trading relationship, May confirmed, and envisages it lasting “around two years”.
“I do not want our partners to fear that they will pay more or receive less,” she said. “The UK will honour commitments it has made during the period of our membership.”
This amount – she did not specify it, but it is widely believed to be around €20bn (£18bn) – could go some way towards kickstarting the divorce talks, which broke down over the financial settlement.
But the EU is thought to be looking for a final settlement of between €50bn and €100bn, so was also looking for assurances that the UK will meet its longer-term unpaid liabilities for EU projects and commitments lasting years beyond Brexit.
This was trickier for the prime minister. Any promise of major transfers to the EU after 2020 would be likely to cause uproar among her hardliners. Accordingly, she was vague on the question.
May said only that the UK wanted “to continue working together in ways that promote the long-term economic development of our continent”, including taking part – and contributing “out fair share of the costs” in “specific policies and programmes ... such as science, education and culture – and mutual security.”
Transition period
May’s financial offer could now help pave the way to a transition period aimed at bridging the gap between leaving the EU in March 2019 and beginning the new trading relationship, which she confirmed should last “about two years”.
The UK and the EU would “not be able to implement smoothly” many of the new arrangements that would be necessary, she said, and “people and businesses would benefit from a period to adjust in a smooth and orderly way”.
The UK and the EU would “not be able to implement smoothly” many of the new arrangements that would be necessary, she said, and “people and businesses would benefit from a period to adjust in a smooth and orderly way”.
The EU had made clear that any transition period must maintain the status quo, meaning Britain would have to abide by EU law (including accepting the jurisdiction of the European court of justice) and continue to allow free movement.
The EU has long said any transition period must maintain the status quo, meaning Britain will have to abide by EU rules – including the jurisdiction of the European court of justice – and continue to allow free movement.
May accepted this, saying people and businesses “should only have to plan for one set of changes”. So during the transition period “access to one another’s markets should continue on current terms”. The framework for this “strictly time-limited period” would be “the current structure of EU rules and regulations”, she said.
May accepted this, saying market access “should continue on current terms” and that the framework for this “strictly time-limited period” must be “the current structure of EU rules and regulations”. The only difference will be that from 29 March 2019, all new EU arrivals will be registered.
The only concrete difference would be a registration system for new arrivals from the EU. She also said aspects of the transition period could be brought forward “if this can be done smoothly”.
This gives the chancellor, Philip Hammond, the gradual exit he has been asking for all summer to avert a regulatory cliff-edge UK business. It should also satisfy the Brexiters, who can at least feel Britain is at last well and truly on the way out.
This gives the chancellor, Philip Hammond, the gradual exit he has been asking for all summer to minimise the shock to British business. It should also satisfy the Brexiters, who can at least feel Britain is at last well and truly on the way out.
It will pay ... something
Citizens’ rights and the Irish border
To help secure this transition period, the prime minister offered to pay enough into the EU to ensure no member state will have to stump up more (or receive less) during the current budget round ending in 2020. She did not mention a sum, but it should be about €20bn (£18bn).
After a series of Home Office blunders, the EU27 were looking for strong assurances on citizens’ rights. In a significant gesture, May offered to write legal protections for EU citizens living in the UK into the exit treaty.
“The UK will honour commitments it has made during the period of our membership,” she said. This may go part of the way towards kickstarting the divorce talks, which broke down over the financial settlement.
“I want to incorporate the agreement fully into UK law, and make sure British courts can refer directly to it,” she said. This represents a considerable strengthening of the UK’s earlier proposals to write the agreement on citizens’ rights into UK law, meaning it could have been rewritten by MPs.
But the EU is looking for far more. It is eyeing a final settlement of €50bn-€100bn, so was also looking for assurances that the UK will meet its longer-term unpaid liabilities for EU projects and commitments lasting years beyond Brexit, something Brexiters will find it hard to accept.
In a further concession, May said she accepted a role for the ECJ in settling citizens’ rights disputes. “I wants UK courts to be able to take into account the judgments of the European court of justice with a view to ensuring consistent interpretation,” she said.
So here she was vague, saying only that the UK wanted to “continue working together to promote long-term economic development” and would contribute “our fair share of the costs” in “specific policies and programmes” including science, education, culture and mutual security.
But the EU had also made it clear it expects Britain to solve the problem of the border between Northern Ireland and the Republic, and dismissed London’s proposals so far as “magical thinking”.
Concessions on citizens’ rights ...
It wanted substance here, and it got none. “We have both stated explicitly we will not accept physical infrastructure at the border,” she said – but made no new suggestions on how this might happen.
After a series of Home Office blunders, the EU27 were looking for strong assurances on citizens’ rights. In a significant gesture, May offered to write legal protections for EU citizens living in the UK into the actual exit treaty.
Defence partnership
“I want to incorporate the agreement fully into UK law and make sure British courts can refer directly to it,” she said. This represents a considerable strengthening of the UK’s earlier proposals, which would have allowed MPs to alter EU citizens’ rights.
May made a great deal of the contribution that the UK can make to European defence. She said she wanted “a bold new strategic agreement that provides a comprehensive framework for future security, law enforcement and criminal justice co-operation: a treaty between the UK and the EU.”
In a further concession, May said she accepted a role for the ECJ in settling rights disputes: “I want UK courts to be able to take into account the judgments of the European court of justice with a view to ensuring consistent interpretation.”
Britain “is unconditionally committed to maintaining Europe’s security”, she said, and was offering a partnership “unprecedented in its breadth and depth”.
... but no clue on the Irish border
Although the EU27 will certainly welcome continued defence and security cooperation with the UK, they have repeatedly made clear that they are not prepared to see it used as a bargaining chip in Brexit negotiations.
The EU also made it clear it expects Britain to solve the problem of the border between Northern Ireland and the Republic once the UK leaves the bloc and its customs union, and has dismissed London’s proposals so far as “magical thinking”.
Future relationship
It wanted substance here, but it got none. “We have both stated explicitly we will not accept physical infrastructure at the border,” May said – but made no new suggestion on how that might actually be made to work.
The EU27 were looking for an indication of what kind of future trading relationship and single market access the UK wants, a question on which the government has refused to communicate clearly mainly because it has not agreed this itself.
UK sees defence as part of the deal
Broadly, the choice is between a “high-access, low-control” model, remaining close to the EU in regulatory terms but at a cost in sovereignty and cash – like Norway or Switzerland. This option is favoured by cabinet “realists” such as Hammond and the home secretary, Amber Rudd.
May made a great deal of the contribution the UK can make to European defence. She said she wanted “a bold new strategic agreement” providing a “comprehensive framework for future security, law enforcement and criminal justice cooperation”.
The alternative is a “low-access, high-control” model giving greater freedom but fewer rewards, such as the free trade deal the EU recently struck with Canada, which is the preferred route for the clean-Brexit camp led by Boris Johnson.
But although the EU27 will certainly welcome continued defence and security cooperation with the UK, they have repeatedly made clear that they are not willing to see it used as a bargaining chip in Brexit negotiations.
What the EU will not accept, as its chief negotiator, Michel Barnier, has made clear, is a bespoke halfway house. In other words, Britain cannot have its cake and eat it: Norway-style big benefits cannot come at Canada-style low costs.
Regulation important – but still no plan for future relationship
Unfortunately, this is what May said Britain wanted. She said the task was “to find a new framework that allows for a new economic relationship, but leaves rights and obligations in a new balance”.
The EU27 were looking for an indication of what kind of future relationship and single market access the UK wants, a question on which the government has refused to communicate clearly mainly because it is not agreed on this itself.
She said she did not accept the “stark and unimaginative choice” between two options. “I do not believe either of these two options would be best for the UK or the EU,” she said. A Norway-style deal would represent “a loss of democratic control”, while a Canada-style deal would be “a restriction on our market access”.
Broadly, the choice is between remaining close to the EU in regulatory terms but at a cost in sovereignty and cash, like Norway or Switzerland; and cutting loose to seek a free trade deal such as that the EU recently struck with Canada, which offers greater freedom but fewer rewards.
She renewed the UK’s call on the EU to be “imaginative and creative” in helping design a “new and ambitious economic partnership”.
What the EU will not accept, as its chief negotiator, Michel Barnier, has made clear, is a bespoke halfway house. Britain cannot have its cake and eat it; Norway-style big benefits cannot come at Canada-style low costs.
May did, however, make one significant concession on future trade, accepting that “regulatory issues are crucial” and “we need strong and appropriate dispute mechanism”, which meant “neither the ECJ nor indeed UK courts can be the arbiter of disputes”.
Unfortunately, this is what May said Britain wanted. A “stark and unimaginative choice” between two options was not “best for either the UK or the EU”, she said. A Norway-style deal would represent “a loss of democratic control”, while a Canada-style deal would be “a restriction on our market access”.
She did, however, make one concession, accepting that “neither the ECJ nor UK courts can be the arbiter of disputes” – meaning a new “strong and appropriate dispute mechanism” would have to be found.
