Johnson’s Plan for EU Divorce Deal Hits Trouble: Brexit Update
British PM Johnson will present a new plan for a Brexit deal to the EU within days, but there are already signs it may fail.
(Bloomberg) -- Boris Johnson said the European Union will insist on customs checks because the whole U.K. -- including Northern Ireland -- is leaving.
Blaming the bloc for the need for checks is likely to inflame tensions in both Brussels and Dublin, and the Irish government described a leak of an earlier version of the U.K.’s proposals as a “non-starter.” If Johnson fails to come up with something workable this week, Britain could be on course to crash out of the bloc without a deal. That would mean a showdown -- and probably a court battle -- between the government and members of Parliament.
Key Developments:
- Johnson says there will have to be customs checks, but wants them to be limited and handled away from border
- New blueprint expected to be presented this week; Johnson says now is when the “rubber hits the road”
- Irish Foreign Minister Simon Coveney says what has been proposed so far won’t work
- Pound reverses losses after Bloomberg reports that EU governments have discussed a time limit on the backstop -- a major concession -- subject to the U.K. accepting the provision keeping Northern Ireland in the bloc’s customs union
- Johnson has long rejected the backstop, while there’s no indication Ireland would accept the idea
- Brexit hardliners signal they may be willing to compromise
EU Ready to Consider Time Limit on Backstop (5:25 p.m.)
European Union governments have discussed giving the U.K. a major concession on Brexit by possibly time-limiting the contentious backstop mechanism for the Irish border, two people familiar with the matter said.
A time limit -- something the EU has long said was out of the question -- would only be on offer if the U.K. accepted the backstop, which would keep Northern Ireland in a customs union with the bloc. Prime Minister Boris Johnson, who is planning to reveal his own proposals for the issue this week, has said he won’t accept the backstop, which was agreed to by his predecessor Theresa May but opposed by the British Parliament.
Johnson Says Customs Checks Inevitable: BBC (5 p.m.)
Prime Minister Boris Johnson said the European Union is insisting on customs checks after Brexit and the U.K. has to accept that, but argued they can be “absolutely minimal and non-intrusive.”
“There will have to be a system, for customs checks away from the border,” Johnson said in an interview with the BBC, according to a transcript. “That is where the argument is going to be. And that’s where the negotiation will be tough.”
Johnson also said there is a “good chance” of getting a Brexit deal, but added it’s “no higher than that.” He also hinted that the government could be obstructive in the EU if it was forced to ask for an extension, after Parliament passed legislation to prevent a no-deal Brexit.
“It goes without saying that the U.K. would be held against the will of its government, and indeed against the will of the people of the U.K. who’d voted to leave,” he said. “And I think that would be a very unhappy and unfortunate situation.”
Leadsom Says U.K. Can Deregulate After Brexit (3:15 p.m.)
Business Secretary Andrea Leadsom said there will be “many areas” in which the U.K. will want to cut regulations after Brexit “to make life easier for businesses.”
Speaking at an event at the Conservative Party Conference in Manchester, Leadsom cited the example of European Union rules requiring farms over a certain size to grow at least three different crops, saying British farmers should have more flexibility.
The minister’s comments will do little to dispel concerns by opposition parties that the government may be preparing to relax standards after Britain has left the EU, despite repeated assurances by ministers to the contrary.
Varadkar Is Pleased by Johnson’s Denial (2:30 p.m.)
Irish Prime Minister Leo Varadkar said his government would resist customs posts as part of any Brexit deal. Speaking in parliament on Tuesday, he said he welcomed the fact that had effectively “disowned” suggestions that customs posts would be placed close to the Irish border.
To do otherwise, would be an evidence of bad faith, Varadkar said.
Brexit Purist Makes Case for ‘Moderation’ (2 p.m.)
In a further sign of the way that pro-Brexit Tories are willing to compromise rather than risk losing Brexit altogether, chief hardliner Steve Baker told a Conservative Party event that he wanted to “make the case for moderation.”
The public are “exhausted” by Brexit, said Baker, the chairman of the European Research Group of Conservative MPs and the man who coordinated resistance to Theresa May’s deal.
He said that the best way of leaving the EU is with a deal. Acknowledging the concerns of those who worry about a no-deal Brexit, he said the U.K. faces a particular problem in the Dover-Calais crossing, where things can “bung up,” creating problems elsewhere.
Confidence Vote Before EU Council Unlikely, Says Labour
Johnson’s Brexit opponents are unlikely to hold a vote of confidence in the government before the EU summit on Oct. 17 and 18, said Labour’s treasury spokesman John McDonnell.
His comments echo those of Liberal Democrat Leader Jo Swinson on Monday. A vote of confidence this week would “increase the risk” of a no-deal Brexit and “play into Boris Johnson’s plans,” Swinson said.
Corbyn also said Monday there wouldn’t be one until the risk of a no-deal exit has been removed. Their concern is if they time it wrong, the U.K. will crash out of the bloc without an agreement.
If the government lost a vote of confidence, it would trigger a 14 day period in which MPs could try to form an emergency, or national unity government, otherwise a general election would be called.
New Idea Looks a Bit Like Ireland’s No-Deal Plan (1:30 p.m.)
In some aspects, the idea of having checks away from the border resembles the concepts Ireland has floated for a no-deal scenario.
Officially, Ireland remains locked in talks with the European Commission on how to protect Europe’s single market in the event of the U.K. exiting the EU without a divorce agreement. While there’s some confusion on the precise nature of the plan, Irish Prime Minister Leo Varadkar has already conceded there would have to be some checks close to the frontier, particularly on livestock and food. Others would take place at ports, airports and firms “as far as possible.”
Minister Says Border Reports Are ‘Incorrect’ (12:50 p.m.)
Brexit Minister James Duddridge told the House of Commons that there are no plans for physical checks at the Irish border after Brexit and said reports that customs posts would be placed 5-10 miles from the Irish border were “incorrect.”
“There’s no intention to have physical checks at the border, I’m not choosing my words carefully, there are no plans to do that,” Duddridge said in answer to questions in the House of Commons. “Reports suggesting there might be checks near the border, those reports are simply incorrect.”
“I can categorically say there are no plans, there never have been plans for any physical checks at all,” he said.
The U.K. will set out its plans for a replacement for the border backstop “in the coming days,” Duddridge said.
Johnson said earlier there would have to be some checks, without saying where.
SNP Frustrated at Opposition Talks (12:40 p.m.)
Ian Blackford, the Scottish National Party’s leader in Westminster, told the BBC that bringing down Boris Johnson’s government is the only way to guarantee the U.K. doesn’t leave the European Union without a deal on Oct. 31.
“We’re in a situation where we’re playing with fire because we have a prime minister that may be prepared to break the law and crash us out at the end of October,” Blackford told the BBC on Tuesday.
His comments point to growing tensions between the opposition parties, with the SNP’s interests increasingly not aligned with either Jeremy Corbyn’s Labour Party or Jo Swinson’s Liberal Democrats. Blackford said there was a risk Johnson will prorogue, or suspend, Parliament within days to begin a new session, costing MPs valuable time to oppose the government’s plans.
He also said parties that voted for the Benn Act, which requires the prime minister to delay Brexit if he can’t agree a divorce deal, should be prepared to go further. The idea would be to hold a no-confidence vote, agree on a candidate to lead a unity government to extend Brexit and call an general immediate election.
“Those who want to see that extension should have the courage of their convictions to join us and remove this toxic prime minister from office,” Blackford said. “That would be real leadership.”
Javid: Shorting Pound Conspiracy ‘Ridiculous’ (11:40 a.m.)
Chancellor of the Exchequer Sajid Javid dismissed a question from a Labour Member of Parliament, who asked if he is confident investors shorting the pound don’t have inside information on the prospects of a no-deal split from the European Union.
“That is such a ridiculous suggestion it doesn’t deserve an answer,” Javid told the House of Commons on Tuesday.
The question follows comments from former Chancellor of the Exchequer Philip Hammond and Boris Johnson’s sister, Rachel, claiming that “speculators” among the prime minister’s financial backers stand to make large amounts of money from a no-deal Brexit.
EU Sticks to Its Line (11:20 a.m.)
European Commission’s spokeswoman Mina Andreeva reiterated that the EU has yet to receive workable U.K proposals, and she declined to comment on media reports.
She did, however, point out that any proposals must meet all the objectives of the backstop, including the integrity of the single market and the protection of the all-island Irish economy. The only proposal that meets all of these objectives currently on the table is the backstop, Andreeva told reporters in Brussels.
Plan Violates EU Law: Germany’s Roettgen (10:50 a.m.)
The EU isn’t responding particularly positively to the leak of the U.K.’s earlier proposal for the Irish border. This tweet, from the chairman of the German parliament’s foreign affairs committee, sums things up.
“Johnson simply doesn’t learn: his latest #Brexit plans are not serious and violate the law,” Norbert Roettgen said. “He wants to ask EU not to extend the deadline & proposes a backstop that de facto is a hard border. Not least to protect the sovereignty of the U.K. parliament, #EU should give long extension.”
Baker Warns Johnson Over Brexit Deal (9:30 a.m.)
Steve Baker, who leads the pro-Brexit European Research Group caucus in Boris Johnson’s Conservative Party, warned he would vote against any deal the prime minister brought back from Brussels if it didn’t mean a proper split from the European Union.
“I’m going to have to say to the public, to Brexit Party voters, Conservative voters, to Nigel Farage: this really is Brexit and you should back it,” Baker told the BBC on Tuesday. “If I can’t do that, I’ll vote against it.” Baker said he was “highly confident” Johnson would only ask him to vote on a “good deal.”
Baker said some hardening of the Irish border was an inevitable consequence of leaving the EU, but that technology and other solutions will minimize the impact on businesses and people. Additional checks are “inescapable” because the U.K. will not stay in the EU’s customs union or single market, he said.
“People need to understand, it’s these arrangements with a deal, or these arrangements with no deal,” he said. “There’s no world in which we’re doing something other than this.”
Johnson Blames Sexual Allegation Woes on Brexit (8:45 a.m.)
In a round of interviews on broadcast media, Johnson repeatedly said claims made about his sexual relationships are being used by his political opponents who want to frustrate Brexit.
An allegation by journalist Charlotte Edwardes -- that Johnson had touched her thigh at a lunch twenty years ago -- was denied again by Johnson. He told BBC radio the reason these allegations are surfacing now is “a lot of people don’t want Brexit to be done” and “rightly or wrongly they see me as the person who is helping to deliver Brexit.”
“There is a concerted effort to frustrate Brexit,” he said.
Johnson also denied suggestions from his sister, Rachel, that he is pursuing the interests of financial backers set to gain from a no-deal Brexit. He told LBC radio his sister was wrong.
Johnson to Suspend Parliament for Queen Speech (8:42 a.m.)
The prime minister suggested he’s preparing to suspend -- or prorogue -- Parliament again in order to lay out his government’s legislative agenda in what’s known as a Queen’s Speech.
The Supreme Court ruled last week that his previous five-week suspension of Parliament to allow for the speech was “unlawful.” The judges noted that pausing for a few days is more usual.
“To have a Queen’s speech it is technically necessary to prorogue, so we will have to find out a way of doing that that we think is in conformity with the judgment and we think there probably is,” Johnson said on Tuesday in an LBC radio interview. “We will have a Queen’s Speech,” he said, without giving a date for it.
PM Hints U.K. Could Be Difficult If ‘Corralled’ (8:30 a.m.)
Boris Johnson suggested Britain might not be a constructive member of the EU if it is trapped in the bloc with another extension to the Brexit deadline. His comment represents a break from his predecessor, Theresa May, who had insisted the U.K. would be a responsible partner.
It would be “a mistake to keep the U.K. bound in beyond the time people want,” he said. “It’s a matter of common observation that the U.K. wants to come out,” Johnson told BBC radio. “I don’t think any purpose is served in corralling the U.K. inside the EU”.
Johnson Sees ‘Questions’ About Rebel Law Origins (8:25 a.m.)
The prime minister said he had “questions” over origins of a law drafted by rebel Conservatives and opposition parties that now compels him to seek a delay to Brexit if he hasn’t got a deal by Oct. 19.
Asked about Sunday newspaper stories that his office suggested there was “foreign collusion” in the drafting process, Johnson didn’t knock the idea down -- though he said “those aren’t my words.”
“There is a legitimate question to be asked about the generation of this SO24 legislation,” Johnson told BBC radio on Tuesday, referring to the clause in the Parliamentary rulebook that allowed the legislation to be debated. “We have no knowledge of how it was produced. It was not subject to normal parliamentary scrutiny.”
Irish Government Rebuffs U.K. Ideas (8:25 a.m.)
Ireland’s Europe Minister Helen McEntee said in a Newstalk radio interview that the idea of customs posts close to the Irish border is “clearly not acceptable.” Such checkpoints would disrupt the all-Ireland economy and have already been dismissed by the EU, she said.
While she pointed out these are not the U.K.’s final proposals, she said if they formed the basis of Johnson’s plan, it brings no-deal closer. As yet, the U.K. has brought forward “no credible” proposals to solve the Irish border impasse.
Johnson Denies Plan for String of Checkpoints (8:15 a.m.)
Prime Minister Boris Johnson denied reports his government is proposing a string of border posts away from the crossing between Northern Ireland and the Republic of Ireland.
“That’s not what we’re proposing at all,” Johnson told BBC radio. “There are very good reasons why that would not be a good idea and I think everybody who is familiar with the situation in Northern Ireland wouldn’t want both for practical and for reasons of sentiment that we totally, totally understand.”
In the end, the U.K. “must have a single customs territory,” Johnson said. “But there are plenty of ways we can facilitate north-south trade.”
Johnson Declines to Give Details on His New Deal (7:50 a.m.)
Boris Johnson said the U.K. has a new plan, and he sees a way forward in talks, but he wouldn’t go into details in an interview with the BBC.
He said it’s crucial for the U.K. not to be trapped in EU customs rules after Brexit, and he will “abolish” the backstop. Any deal will prevent a hard border and respect the Good Friday Agreement, he said.
“What we want to do is get rid of the backstop and that’s the most important thing,” Johnson said. “We also want changes to the political declaration which sets out the future shape of relationships between the U.K. and EU.”
Coveney Says Proposals So Far Are Non-Starter (Earlier)
Coveney said the U.K. ideas on managing the border that were proposed in an earlier document were a “non-starter.” He was commenting after Irish broadcaster RTE reported late Monday that U.K. has proposed customs checks five to 10 miles away from the Irish border.
Earlier:
--With assistance from Stuart Biggs, Alex Morales, Ian Wishart, Dara Doyle and Tim Ross.
To contact the reporters on this story: Kitty Donaldson in London at kdonaldson1@bloomberg.net;Thomas Penny in London at tpenny@bloomberg.net;Alex Morales in London at amorales2@bloomberg.net
To contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Stuart Biggs, Thomas Penny
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