Settle Brexit bill quickly to boost chance of free trade deal, say pro-EU Tories
Theresa May will be urged by pro-EU Conservatives to reach a quick deal over the divorce bill from Brussels in order to maximise the chances of reaching a free trade deal within the tight deadline for Brexit talks.
As the prime minister prepares to trigger article 50, the formal process for leaving the EU, on Wednesday, rebel Tories who seek the closest possible relationship with the EU are preparing to offer May political cover for settling what they see as Britain’s debts to Brussels.
They fear that Britain could waste valuable time and erode goodwill by locking horns with the remaining members – the EU27 – over the price of exit, which must be agreed upfront, according to the EU’s lead negotiator, Michel Barnier.
They are concerned that dragging out the issue would hand Brexit hardliners an excuse for walking away from the negotiating table without a deal.
Barnier has suggested the outlines of a deal must be agreed within 18 months in order to allow EU member states to ratify it before the two-year deadline set out in article 50 of the Lisbon treaty.
Neil Carmichael, the Stroud MP who campaigned for remain, said: “If we’re going to row about money all the time, then we’re not going to find ourselves in the right kind of relationship. Some of this money is about the support that we have been giving to eastern European and that’s been good for them and good for all of us. We don’t want to sour the relationship.”
Another Conservative backbencher, Ben Howlett, the MP for Bath, said: “We need to prioritise a free trade deal over absolutely everything else and we will be saying that to the prime minister.”
Article 50 will be formally triggered when a letter is delivered by hand to the EU council president, Donald Tusk, in Brussels on Wednesday, setting out the UK’s negotiating priorities.
Tusk is expected to respond within 48 hours with a draft of the EU27’s negotiating “guidelines”, including how it believes the talks should be conducted.
Government sources said the drafting of the letter was being very tightly controlled by May and her close aides in No 10, with a smaller circle of cabinet ministers being consulted than those who saw advance copies of her Lancaster House speech in January.
Pro-Brexit Tory MPs and ministers, including the foreign secretary, Boris Johnson, have struck a more defiant note about demands from Brussels for a payment of up to €60bn (£52bn) to settle outstanding liabilities, including pensions for EU staff and ongoing infrastructure projects.
Philip Hammond, the chancellor, has been criticised by some pro-Brexit MPs for suggesting Britain would “honour our obligations,” to the rest of the EU, though similar language has been used by May herself.
Steve Baker, who chairs the European Research Group of pro-Brexit backbench MPs, said: “The legal position is that there’s no basis on which to compel us to pay any bill. I don’t think there will any great row”.
Asked about rebels who would like the issue settled quickly, he said: “I don’t think anyone is going to find it easy to say to their constituents that they didn’t think it important to drive a hard bargain.”
Lord Mandelson, the Labour peer and former EU trade commissioner, said focusing on the trade deal, rather than quibbling about the exit bill, was in Britain’s economic interests.
“The divorce bill is small change over the time we will have to pay it, compared to what’s at stake in a future trade deal,” he said, adding that the intransigence over the bill “points up the idiocy of those in the government who are preparing for a breakdown over the divorce by saying that no deal is better than a bad deal. They are clearly people who know nothing about the costs of tariffs and customs duties”.
The cabinet’s Brexit subcommittee broke up last week because of the terrorist attack on Westminster and did not see a copy of the letter for Tusk, which government sources suggested was still being finalised on Monday.
Pro-Brexit ministers are delighted that Wednesday will mark the point of no return for Britain’s membership of the EU. “It will finally crystallise things,” said one government source.
The aid minister, Priti Patel, who was a leading figure in the leave campaign, will celebrate her birthday on Wednesday and is said to be pleased that it coincides with what Brexiters regard as a red letter day.
However, cabinet ministers who campaigned for remain are in a more sombre mood. Another senior government source said: “The Brexiteers will be crowing about ‘independence day’. It’s definitely a moment, but for remainers, it’s difficult.”
The Liberal Democrat leader, Tim Farron, said it was too late for Conservative backbenchers to be putting up resistance to a hard Brexit. “This is the biggest act of economic self harm in history and some Tory MPs are grasping at any straw they can find to assuage their consciences. They, like Corbyn have waived this through and history will judge them for it,” he said.
A cross-party group of MPs, including former education secretary Nicky Morgan and former shadow chancellor Chris Leslie will set out 10 criteria by which they will judge a Brexit deal at an event on Tuesday morning organised by the pressure group Open Britain.
Pro-EU campaigners are keen to shift the argument from seeking to “block Brexit” to setting out the terms of what they believe would be a good deal in the hope of stopping the UK from being forced to adopt World Trade Organization rules, which they believe would be economically disastrous.
The shadow Brexit secretary, Keir Starmer, set out his “six tests” for Brexit in a speech on Monday morning, including a deal that replicates the benefits of single market membership. Starmer suggested Labour could seek to vote down any deal it thought failed those tests.
But Anand Menon, professor of politics at Kings College London and director of the UK In A Changing EU thinktank, said remain politicians must avoid giving May an excuse to walk away from the table, rather than accept a compromise deal.
“It seem to me that if the PM loses a vote on a deal she gets from Brexit that’s not good for her political career. I don’t see any way of coming back from that,” he said. “So it does suggest she will be wary of bringing any deal to parliament where she thinks she could lose a vote.”