Brexit weekly briefing: UK business leaders fret over lack of progress

EXIT

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The big picture

British business is getting anxious – and impatient – about Brexit. Paul Drechsler, the president of the Confederation of British Industry (CBI), the UK’s main business lobby, used its annual conference to say certainty was urgently needed on Britain’s future relationship with the EU.

Drechsler had earlier said there was exasperation at the lack of progress, criticised the fact that Theresa May had still not held a full cabinet discussion on the final Brexit deal, and lamented the government’s episodic, “soap opera” approach.

He urged political leaders across Europe to step up and provide clarity on a Brexit transition, and warned that10% of UK firms had started moving staff or slowing recruitment, claiming that 60% would follow suit if there was no transition deal by March.

Unfortunately, the prime minister could offer no new assurances, saying only that Brexit held “huge opportunities” and that the government realised a strictly time-limited implementation period would be critical to business.

Spotting an opportunity, Jeremy Corbyn told the conference – where the Labour leader was given an unusually warm reception – that on Brexit, his partyincreasingly shared common ground with business:

We have common ground on the need for transitional arrangements to be agreed immediately so that businesses know they won’t face a cliff-edge Brexit … And we have common ground on the threat of ‘no deal’ which, contrary to the claims of the secretary of state for international trade, is potentially a nightmare scenario.

Brexiters hoping for some succour in the shape of a quick trade deal with the US got little comfort from the US commerce secretary, Wilbur Ross, who said it would be very complex to negotiate and could be hindered by “landmines” in the form of Britain’s agreement with the EU.

Ross, ending a five-day trip to the UK, said a US-UK deal would hopefully not take a decade, but identified continued passporting of financial services and compliance with EU food standards on GM crops and chlorine-washed chicken as areas that could “create problems with us”.

We are talking about an agreement where the negotiation can’t even start for a couple of years and very much will be conditioned by the terms of the departure agreement between UK and EU. It’s hard to anticipate where the easy parts and hard parts will be.

The view from Europe

According to assorted European sources, Britain has quietly conceded on two key points in the negotiations: the cut-off date for EU nationals to enter Britain and still have their rights protected, and the size of the financial settlement.

While No 10 has been holding open the possibility that it would offer fewer rights to EU27 citizens arriving after 29 March this year, sources close to the talks told the Guardian it was now clearly understood that those coming to the UK at any point before Brexit day in 2019 would have their rights protected.

The move follows a dramatic fall in the number of nationals coming to the UK from the rest of the bloc since the referendum effectively blew apart any argument for an earlier cut-off date. A senior diplomat said:

People stopped coming, or started coming in much lower numbers, and some are leaving, and industry and NHS are pointing that out.

Meanwhile, sources in Brussels told the Sunday Times that EU negotiators had begun drawing up the outline of a future trade deal with the UK after receiving “signals” from officials that the government was willing to pay more than €60bn (£53bn) as a divorce settlement.

Negotiators in Brussels believe this will open the door to trade talks after Christmas and allow May to claim a much-needed victory, the paper said. May’s Brexit adviser, Ollie Robbins, has reportedly been told that EU officials would need to see just a “single sentence”, in writing, as evidence that Britain will accept the costs.

Meanwhile, back in Westminster

For another week, a parliament that was barely able to focus on much else policy-wise apart from the looming juggernaut of Brexit saw even this gargantuan task overshadowed by yet more revelations and allegations about harassment and inappropriate behaviour in Westminster.

Labour already has two MPs suspended facing investigations, while Theresa May lost the defence secretary Michael Fallon, who resigned last week, and has two other ministers being investigated, including her de facto deputy, Damian Green.

Beyond that, four Tory MPs face inquiries from a new party internal discipline system over claims, while a fifth has been suspended and referred to police.

Beyond the moral implications, could all this affect Brexit? The answer is: possibly. Apart from the fact that yet more government and civil service bandwidth could be diverted, if a series of serious claims are upheld it could lead to more ministerial resignations or even byelections as MPs depart.

May’s minority government is already one of the least stable in modern British political history. It is not beyond the bounds of possibility that a wave of scandals could sink it, bringing an election and possibly a new approach to Brexit.

You should also know:

Read these:

The New York Times’s departing London bureau chief, Steven Erlanger, pulls few punches in a piece arguing that the UK has lost its bearings since the Brexit referendum and now seems intent on embracing “an introverted irrelevance”.

Having voted to leave the EU, it is unmoored, heading to nowhere, while on deck, fire has broken out and the captain – poor Theresa May – is lashed to the mast without the authority to decide whether to turn to port or to starboard, let alone do what one imagines she knows would be best, which is to turn around and head back to shore … Britain is undergoing a full-blown identity crisis. It is a ‘hollowed-out country,’ ‘ill at ease with itself,’ ‘deeply provincial,’ engaged in a ‘controlled suicide,’ say puzzled experts. And these are Britain’s friends.

In the Guardian, John Harris offers a salutary reminder of the terrible irony that the consequences of Brexit mean the “cry of pain” that led so many voters in Britain’s more left-behind regions to vote for it stands little chance of being acted on.

A lot of support for leave can be seen as the climax of years of decline, neglect and condescension – and something that is hardly going to be abandoned in a hurry … The very thing so many places voted for makes any attempt at their area’s revival even less likely. The only economic rebalancing that looks set to arise from Brexit will be London becoming a bit less rich thanks to the downsizing of the City. The Herculean effort needed to even begin meaningful negotiations is so consuming to the machinery of government that it clearly has no capacity for anything else.

Tweet of the week

There’s a whole alarming thread from Jonathan Lis of British Influence here, but this one gives a fair flavour:

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