It almost feels like Budget Day, as the Government prepares to finally publish its economic assessment of the impact of various Brexit scenarios. And like Budget Day, the big danger for Theresa May and Philip Hammond is that the whole thing unravels all too swiftly as MPs and others pore over the small print. The Telegraph had a leak that the study will find GDP would one or two per cent lower after 15 years under May’s deal than if we stay in the EU. A Norway deal would be the next best option (1.4% lower GDP), then a Canada-style deal (-4.9%), then no-deal (-7.6%).
Yet it was still a shock to hear the Chancellor confirm the headline finding on the Today programme. “15 years out, the economy will be very very slightly smaller as a result of the PM”s proposed deal than it would have been if we remained in the European Union,” Hammond revealed. Having long said no one voted in the EU referendum ’to be poorer’, he just confirmed they would be (while adding that “other considerations” like migration, money and laws were clealry important to Leave voters). “It’s true that the economy will be very slightly smaller” Hammond said, though stressing this would be of an “entirely manageable scale”. What looks like a gift to those MPs pushing for EFTA membership, he even said: “If you look purely at the economics remaining in the single market would give us an economic advantage, yes”.
All of which will confirm Hammond as the ‘Remainer in Chief’ that Eurosceptics have long feared. Wary of the Treasury’s tarnished reputation among Brexiteers, the actual economic assessment today is the work of several departments, No.10 has been stressing. Hammond won’t actually be presenting the findings in person (it’s so far a written statement by DExEu), but will the Speaker grant an Urgent Question to force a minister to turn up? Will it really all be left to PMQs? Can we have Brexit Budget Day without the Chancellor taking questions? The full economic report is due at 11.30am and the Bank of England has its own assessment at 4.30pm.
Hammond said that all the alternatives to the PM’s deal had ‘disadvantages’, and said he was spending “time, energy and money” on no-deal contingency plans. Speaking of which, we publish today a letter to the PM written by five former Cabinet ministers (IDS, DD, Paterson, Patel and Whittingdale) and Jacob Rees-Mogg, warning she’s heading for a ‘no deal’ outcome unless she changes course. They argue that the unless the ‘political declaration’ is turned into a legally binding document, the PM should never stump up the £39bn divorce bill. It hardens their position yet further, and tries to turn on the Government the idea of costs to the taxpayer. The £39bn is an ‘eye-watering sum’ worth £1,400 per household without any guarantee of a trade deal in return, the six Brexiteers say.
For me, the most fascinating lines in Hammond’s interview came when he actually broke the usual No.10 edict of not answering the hypothetical question of what the hell would happen if May lost the ‘meaningful vote’ on her Brexit plan. “If the vote on December 11 were lost..we will then have to then sit down as a Cabinet, as a Government and decide where to go on the basis of the vote, what we have seen in the vote, who has voted in which way. Because clearly we live in a democracy, Parliament is sovereign…” Note he said ‘as a Cabinet’, ie this won’t be just up to the PM. Note also his ‘who has voted’ line - was that a hint the DUP confidence and supply deal would be instantly torn up?
I understand the Government’s programme motion for the ‘meaningful vote’ is expected to be published today and it will make plain that No.10 and DExEU have given up their attempt to ‘rig’ the sequencing in their favour. Dominic Raab (remember him?) had sparked a row by suggesting the main motion on the Brexit deal would be presented to MPs first, and amendments taken afterwards. This would have been an inversion of usual conventions, but after the Commons Procedure Committee asserted itself, the Government has now backed own, sources have confirmed.
It’s worth remembering how much the political dynamic has changed since Raab first shocked MPs with his suggestion. Back then, there was the possibility that the Government could squeak through its main motion, giving it the legal effect of ‘ratification’ of what will be the Withdrawal treaty, and all the subsequent amendments would have looked redundant. Now, MPs have a chance to first make clear if there’s a majority for a string of options, from a customs union to a ‘People’s Vote’. But given that the main motion is facing heavy defeat, I think the Government will be actually relieved that vote will take place after the amendments. Why? Because the sequencing may expose the brute fact that there is currently no majority for any rival plan.
Labour will table an amendment backing its own ‘six tests’ alternative, and that is likely to be defeated. The party may think it’s too early to back an explicit amendment at that stage on ‘a customs union’. Moreover, I’m told there is real pressure on People’s Vote MPs to hold off their own amendment too. That’s because Labour’s conference policy stipulates that a general election would have to be tried for before the party can push for a second referendum. Labour has a huge call to make on when precisely to demand a confidence vote in the PM, the mechanism that will allow it to say it has tried the election route first. It only has one shot at calling a confidence vote, but it has to come before any referendum push.
The scale of the defeat is what matters most. One former Cabinet minister suggested to me yesterday that the focus should be on what minimum level of defeat would make May realise she wouldn’t win a second vote. I reckon that if somehow ‘only’ 30 Tories voted against, she would battle on in the hope some could buckle. If more than 70 Tories rebelled then it really could be time for a radical rethink. The Sun suggests today a defeat of up to 200 votes (that’s overall, not Tory rebels). Let’s see if the whips can make an impact - don’t underestimate the pressure they can exert. As we reported last night, Michael Gove (on Marr on Sunday and before MPs today) is seen as the Government’s ‘secret weapon’ in turning round backbench opinion. But in one clue to how some Brexiteers no longer trust him, I’m told Gove was on Monday ruthlessly deleted from the European Research Group (ERG) Whatsapp group.
As soon as the PM’s spokesman briefed us yesterday on the legal advice on Brexit, a fresh row was guaranteed. No.10 announced that it would only be publishing a legal ‘position statement’. This is indeed what was promised by David Lidington earlier this month, along with an oral statement by the Attorney General. But it is of course not what the Commons voted for, which was the publication of “any legal advice in full, including that provided by the Attorney General” on the Brexit deal.
Keir Starmer has said it is ‘completely unacceptable’ for the Government to refuse to publish what the Commons voted for and has threated to ‘use all the mechanisms available to force this information to be published’. One problem here is that ministers think Starmer himself hinted during the debate that the motion was too broadly drafted. The idea of publishing ‘any legal advice’ could capture every single lawyers’ note on the Withdrawal Agreement. Tories say Law Officers have to consider the public interest in disclosure, and Speaker Bercow suggested that position remained unchanged.
But it seems the Government really did blunder when it decided not to contest Labour’s ‘humble address’ motion, which was passed without a vote. That’s because Solicitor General Robert Buckland had made a last-ditch appeal to Starmer to offer “a comprehensive position statement” in return for him not pressing the issue to a vote. No vote was pressed but Starmer didn’t withdraw the motion itself and it was passed. Starmer clarified he wanted the ‘final and full advice’ published. Speaker Bercow said simply that the motion was ‘effective’ and was an expression of ‘the will of the House’. Still, I’d be amazed if ministers didn’t dig in. Yet with Brexiteers as angry about this as Labour, it’s a very tough political sell that doesn’t make the bigger meaningful vote case any easier.
In case you missed it, watch Boris Johnson’s slap-dash, gaffe-prone tenure at the Foreign Office captured magnificently by this clip from a behind-the-scenes BBC documentary.
Whitehall turf wars appear to have Sajid Javid fighting on two fronts. In a real problem for the PM’s hopes of playing her trump card on immigration ahead of the Commons Brexit vote, the Standard revealed yesterday that the Home Secretary was minded to join Philip Hammond and Greg Clark in opposing No.10’s hopes of a mass clampdown on low-skilled EU migration visas. And today, the Times reveals Justice Secretary David Gauke is blocking Javid’s plans for asbo-style powers for any youngster suspected of carrying a knife or of being in gangs linked to stabbings. A Whitehall source says Javid was “grandstanding on knife crime”.
Labour’s Shadow Treasury team have given a further hint that the next manifesto will be more radical than the last (John McDonnell told me recently the 2017 plan was frankly ‘tame’). The Guardian reports that a report commissioned by Rebecca Long-Bailey and McDonnell has called for customers of Britain’s 7,000 biggest firms to be given the right to vote on the pay of their bosses. The study calls for an annual binding vote on executive packages to include all stakeholders – including employees and consumers. Other suggestions include scrapping all forms of share options so that executives are paid only in cash.
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