Was There `Deliberate' Attempt to Be Negative?: Brexit Update

(Bloomberg) -- Prime Minister Theresa May is in China trying to sell the idea of Brexit to the world’s biggest market amid signs there is a hardening in her position toward the the European Union.

Until a week or so ago, it had appeared that approving a two-year transition was but a formality. But after a backlash from the pro-Brexit wing of May’s Conservative party, May is vowing to fight the EU on the terms of the transition arrangement that businesses are desperate for her to pin down. Liam Fox, the international trade secretary traveling with her in China has talked about the transition as an “if” rather than a certainty.

Critically, reports abound that May’s days -- long rumored to be numbered -- could be coming to an end. This might be the weakest the prime minister has looked since losing her majority in June’s election gamble.

Shedding light on the direction of Brexit will be David Davis, the man who sits opposite Michel Barnier at the negotiating table in Brussels. He addressed the House of Commons at 9:30 a.m. We updated in real time, all the time stamps are London time.

Baker Says “Correct” When Asked About Distortion (10:35 a.m.)

Jacob Rees-Mogg, who has been leading the charge of the hardliners, asked about an account that Treasury civil servants had sought a negative outcome for all options in economic modelling except staying in the customs union.

Here was the exact question: Can the minister confirm that he heard from Charles Grant from the Centre of European Reform “that officials in the Treasury have deliberately developed a model to show that all options other than staying in the customs union were bad and that officials intended to use this to influence policy?”

Brexit Minister Steve Baker, in his response, “said the account that was put to me Mr Speaker is correct.” The answer seemed to validate Rees-Mogg’s point of view and will surely kick off a new round of controversy.

Here is a fuller answer: “It was put to me, I consider it an extraordinary allegation, Mr Speaker, I still consider it an extraordinary allegation and I think we must...I did not in any way seek to confirm the truth of it, but I would say we need to proceed with great caution because it’s essential we continue to uphold and support the impartiality of the civil service.”

Davis Slams Forecasts About Harmful Brexit (10:22 a.m.)

The Brexit secretary, in response to the ongoing fallout over the Buzzfeed leaks, stated that “every forecast that’s been made of the period post-referendum has been wrong.” Economic analysis, he said, is a “work in progress.”

This is not the view just of politicians, he said, and said “relying” on such findings does not constitute as “evidence.”

Are There Stumbling Blocks to the Transition? (10:16 a.m.)

Davis signaled there might be: “there remain a number of areas we need to discuss to ensure the period goes smoothly.”

Unruffled Davis Asked About Leaks to BuzzFeed (10:06 a.m.)

Here is his line: “We will of course release all info necessarily once it’s no longer sensitive to the negotiations.” To read more about the latest on that front, click here.

The implementation period? Still, about two years. Nothing new there.

Slip of Tongue? Davis Refers to “My” Ministers (9:54 a.m.)

It’s rare that Davis makes an appearance in Parliament and doesn’t make news. He let some of his junior ministers answer some questions before stepping in himself to say that the European Court of Justice would not have direct jurisdiction after the transition.

“During that period the primary concern I have is about new laws coming into affect over which we have no say and we will work to ensure they do no harm in the United Kingdom,” he said.

He also said all “my” minister support government policy. An interesting distinction given how it appears there is no agreement on Cabinet level about the direction of Brexit.

Minister Defends Decision to Leave Customs Union (9:47 a.m.)

Suella Fernandes, fresh off her promotion in the reshuffle and one of the most influential Brexit campaigners, said the government is committed to leaving the Customs Union and said doing so would bring benefits to the U.K.

The British people "instructed this parliament to take us out of the EU customs union and that is exactly what the prime minister is doing and this government is doing,” Fernandes said in Parliament. The U.K. will be free to pursue an independent trading policy, while the removal of tariffs negotiated by the EU could benefit consumers, she said.


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