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25th Jun 2018

Column / Brexit Briefing

London: Little room for manoeuvre in Brexit talks

  • UK officials are now privately resigned that a post-Brexit trade deal has little chance of being struck before March 2019. (Photo: Tamara Menzi)

UK officials were slightly taken aback by the school-masterly rebukes that European Commission president Jean-Claude Juncker and the EU's Brexit negotiator, Michel Barnier, offered on the seven position papers published by the UK's Department for Exiting the EU (DexEU) ahead of last week's Brexit talks.

"This is actually as far as we can go right now," one DexEU official told EUobserver.

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While Barnier urged UK negotiators to "get serious" before the next round of talks begins on 18 September, calendars and internal political pressures give British ministers and civil servants very little room for manoeuvre in the coming weeks.

MPs return to Westminster on Tuesday (5 September) for a ten-day session, during which the EU (Withdrawal) Act, also known as the Repeal Bill, will get its second reading before MPs on Thursday (7 September).

Elections to the influential Exiting the EU committee of MPs will be held on Tuesday as well.

On 14 September, parliament will then go into recess for the four-week party conference season, where both the Conservatives and Labour leaderships face concerted challenges from their respective Brexit positions.

Party conference season

The Conservatives gather in Manchester for their annual jamboree on 1 October, although having lost their governing majority at the June election and with Theresa May's leadership still under scrutiny, it will a fractious affair.

May, who suggested last week that she wanted to fight another election as prime minister, is expected to offer some form of mea culpa for the election debacle.

DexEU are constrained by their ministers' difficulties in being able to offer concessions on the Brexit divorce bill.

Two newspapers ran stories on Sunday claiming that May has started laying the groundwork to agreeing a €50 billion divorce payment, although UK Brexit secretary David Davis said in a BBC interview that both stories were "nonsense".

The political and time pressures explain, in part, the UK's tactics so far, but have left only a slim prospect of "sufficient progress" being made in time for October's European Council meeting, where EU leaders will decide whether to authorise the opening of negotiations on a successor EU-UK trade deal.

"We're not making substantial progress and the question remains open," David McAllister MEP, chair of the European Parliament's foreign affairs committee and a close ally of German Chancellor Angela Merkel, tells EUobserver.

"We just hope that things will calm down after the Tory party conference," a senior MEP told this website, adding that he "hoped that May will announce something more sensible in October."

In the meantime, ministers and DexEU officials are now privately resigned that a post-Brexit trade deal has little chance of being struck before March 2019.

Their preferred fall-back position is a two or three-year transition period after 2019, during which the UK would remain part of the single market or customs union but, importantly, have the ability to agree trade deals with other countries.

"A transition without flexibility on other trade deals would be the worst of both worlds," says an official in Liam Fox's Department for International Trade.

Labour's new Brexit position

For their part, Labour's new policy of keeping Britain within both the single market and customs union during any post-2019 transitional period is also under pressure.

Securing this policy position from party leader Jeremy Corbyn, a eurosceptic by conviction, who last month insisted that single market membership was "dependent on membership of the EU", is a major coup for Labour's Keir Starmer, himself seen as a future leadership candidate.

However, while it has the support of business groups and the trades union congress (TUC), whose general secretary, Frances O'Grady, said it would give people "certainty on their jobs and rights at work", Labour's new Brexit position does not come without risks for Starmer.

A vocal minority of Labour MPs want to end freedom of movement as soon as possible, while many others are anxious about any policy that can be painted as trying to defy the referendum result. The policy is almost certain to be challenged by back-bench MPs and party activists at Labour's conference in Brighton.

A lengthy transition period also increases the prospect that the UK will never actually leave the bloc, the not-so-secret hope of many Remainers.

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