1. ALL OVER BY CHRISTMAS?
The impasse between the UK and the EU over Brexit was confirmed yesterday as Michael Barnier warned of the “disturbing” “deadlock” in the talks. David Davis pleaded with the EU to allow Barnier more freedom to discuss future trade relations as well as the ‘divorce’ bill.
British sources say that while the EU is unlikely to budge in time for this month’s EU summit, they’re “optimistic” that things will be sorted by December. Barnier’s words included a warning to both the EU27 and London that they should show “the necessary will” to make progress. One UK official tells the Times that his words were “an elegant cry for help”, after the Germans last week tried to reduce his room for manoeuvre.
And it’s the Germans who are playing hardball, as Berlin insists it won’t allow the talks to move on unless May gives a written commitment accepting her financial liabilities (they had a kind of verbal one in her Florence speech, but want it nailed down). Several papers and the BBC have got hold of the draft EU paper for the summit which suggests they are prepared to talk transition as long as finances are dealt with.
Given that a specific divorce bill figure was never likely (DD tells colleagues privately he would never give play Britain’s trump card on cash until the last possible moment), will the EU settle for mere words or insist on an algorithm that frames future finances? DD’s department were politically shrewd enough to rattle off a letter to Labour’s Keir Starmer asking him to “spell out exactly how much” he would offer for the EU divorce bill.
Back home, Andrea Leadsom’s decision to postpone the EU Withdrawal Bill suggests rebel Tories may have the numbers to defeat the Government on a string of amendments. Insiders told SkyNews that the volume of amendments means the bill won’t be ready for committee stage next week. The new alliance of Ken Clarke and Labour’s Chris Leslie is obviously the whips’ big worry. Still, I may be wrong, but I suspect we’ll see a Government concession on Henry VIII powers that will dissolve the Tory Remainers’ resolve.
The real question is the EU’s resolve, and May’s. If no movement is made on starting talks on trade and transition this December, the stakes are really high indeed. May will be under huge pressure from the Right to suspend all talks - or lose her own job. Brexiteers love a war analogy and at least two apply here. The phoney war of WW2 lasted months before real hostilities began with Germany. And in ‘the Great War’, everyone thought the action would be all over by Christmas. By the end of 2017, we may know whether an economic World War Three looms between Britain and the EU.
2. THE (OS)BORNE ULTIMATUM
It may seem ages ago but this time last week, mutiny was in the air amid Grant Shapps’ move to oust the PM. Yet while Shapps has since seen a whole load of abuse, he tapped into a definite unease about Theresa May on her backbenches. Her Brexit statement on Monday did little to ease concerns (her ECJ remarks unsettling many Brexiteers), and her PMQs performance wasn’t stellar despite the wall of noise orchestrated by the whips. To paraphrase Elvis (before he left the building), some previously loyal backbenchers think ‘we can’t go on like this, with suspicious minds’.
Among Euroscep ministers and MPs, suspicions swirl that the real mastermind behind the Shapps plot was in fact George Osborne. And last night, the former Chancellor did little to dispel such perceptions. In special Spectator event in London (PoliticsHome was there), Osborne revealed he’d been talking to members of the Cabinet about May’s future. When asked if the party should get behind the PM, he said this: “It’s no good the Conservatives saying ‘well I wish we would stop talking about it’ – you can’t talk to a member of the Cabinet without talking about it and so we’ve got to confront that…Of course it matters who the prime minister is.”
He added that “closing your eyes and hoping it will all go away” while pretending the party remain unified “does not work in politics”. His words were a reminder that the real story last week was not so much Shapps’ plot, but Tim Shipman’s revelation that at least three Cabinet members had talked about removing the PM after her conference disaster. Oh, and Osborne kept his options open for a return to the frontline himself: “I don’t say never”.
3. KILL PHIL
The Tory party’s main displacement activity from sacking May (or Boris) has been to call for the sacking of Philip Hammond, and his predecessor Nigel Lawson did just that on BBC’s Daily Politics yesterday. Relations between No.10 and No.11 have certainly hit a new low of late, and the Sun reports that May and Hammond “can’t bear” to be left alone together in the same room. The FT says May is “increasingly frustrated” with her Chancellor, citing a friend of the PM: “He can’t help winding up the sceptics...Every time he behaves like this, it gets harder in Brussels. He lets his vanity get in the way of doing the job.” Fraser Nelson has a fascinating Telegraph piece that reveals Jeremy Hunt and Sajid Javid confronted Hammond “in blunt terms” over his refusal to properly fund preparations for a ‘no deal’ outcome.
As the PM revealed this week, the Treasury has “committed” some £250m for ‘no deal’ prep, but it’s the ‘strings attached’ by Hammond that has upset some of his colleagues. He wants any payments to be at the very last minute. Indeed, there’s a real question as to whether this money is simply earmarked or being actually spent, and on what. Some of it is in fact not prep for a ‘no deal’, but other options (the FT reports that another 2,000 staff are planned to be hired in Whitehall to cope with Brexit, that alone would cost north of £100m). What’s curious is the rumour that the money may be spent before Parliament approved it. We’re told it will come from Government reserves, but will that approval be in the Finance Bill that accompanies the Budget? If so, watch for amendments on that.
It’s worth noting the PM’s exact words on this. She said departments “such as” DEFRA, Home Office, HMRC and DoT would get the money. No.10 failed to give us a breakdown or say which departments would benefit. The Treasury letter to the Public Accounts Committee explaining all this is due soon.
The Department for International Trade was not named by May, but in Trade Questions yesterday Liam Fox was very robust indeed. In a little-noticed exchange, he was asked by Sir Edward Leigh if the Treasury was giving him all the resources he needed for no deal. Fox replied DiT had a ‘unique agreement’ with the Treasury it could increase staffing levels on Brexit. “There is no difference between the Chancellor and me. The Chancellor says that we need to spend money only as necessary. I think that that is correct…” He then added this kicker: “…but we also need to ensure that we spend money on all areas where contingency plans are necessary”. Smoke that, Phil.
4. DRONE ALONE 2
Defence Secretary Michael Fallon yesterday all but confirmed that British IS recruit Sally-Anne Jones had been killed in the US drone strike in Syria. Reading carefully from a script, Fallon warned that anyone who joined Daesh made themselves “a legitimate target and run the risk, every hour of every day, of being on the wrong end of an RAF or USAF missile.”
Government figures certainly think the public is right behind such assassinations, but unease is growing in Labour at the strike and at claims that Jones’ 12-year-old son was also killed in what the US calls “collateral damage”. Crucially, Jeremy Corbyn put his worries on record, saying terror suspects like Jones “ought to be put on trial” rather than killed.
Fallon pounced on Corbyn’s remarks, clearly seeing them as a repeat of the Labour leader’s equivocation about the drone strike on ‘Jihadi John’. Fallon said Corbyn’s “continued refusal to back drone strikes on terrorists who are actively plotting murder on our streets shows he is simply not fit to lead or keep us safe.” But a spokesman for the Labour leader told HuffPost UK: “Conservative smears didn’t work in the general election and they won’t work now. As he has said repeatedly, as Prime Minister, Jeremy will do everything necessary and effective to keep our people safe.”
5. GREEN DAY
Damian Green is seen on most sides of the Commons as a decent, pragmatic politician. But even Theresa May’s de facto deputy Prime Minister couldn’t prevent the Government losing a ‘no confidence’ motion at the Oxford Union last night. In perhaps another indication of the youthful ‘Corbyn surge’, the motion was passed by 229 votes to 74. Last year the vote was much narrower (185 to 135) and in 2015 the motion was actually rejected.
Green and Victoria Atkins were up against Emily Thornberrry (her sparring partner in deputy PMQs), Hilary Benn and Vince Cable. Green based his speech on the merits of capitalism versus socialism, but was wounded by an intervention from a student asking why - if he believed in free markets so much - he wanted to crash out of one of the largest free markets the world had ever known. The burn marks were visible, my mole says. To be fair to Green, he is one of the few Remainers to stick to his guns this week, telling Newsnight “it would have been” better if the UK voted to say in the EU.
It’s been a long week for Green, however, and it showed during Cabinet Office Questions. When asked by Labour MP Faisal Rashid about the race disparity audit and the lack of civil service diversity, Green replied that it was a valid point, adding “the Honourable Gentleman asked about this in my statement yesterday.” Except Rashid hadn’t. Another Asian Labour MP, Afzal Khan, had challenged Green on Tuesday. Rashid told HuffPost UK the mix up was “very disappointing”. Green’s spokesman stressed he had “simply forgotten” which MP had raised which issue during his long Oral Statement. The minister certainly was confused: Khan had asked about religious discrimination, not the civil service.
Our latest Commons People podcast is out. Last week saw record high figures as 14,000 of you tuned in to our Tory conference special. This week we chinwag about DD v Barnier, Hammond ‘going rogue’, Universal Credit and a quiz on politicians’ pets. Click HERE to listen on Android/audioboom and HERE to listen on iPhone/iTunes.