May must unite Tories on Brexit or lose election, warns Hague
Prime Minister faces Cabinet split over EU deal as she prepares for key speech to set out plan
THERESA MAY must use a landmark speech on Friday to unite the Cabinet around an agreed plan for Brexit or risk an irreversible split in the Conservative Party, Lord Hague warns today.
The former party leader says senior ministers “lack co-ordination” 15 months on from the EU referendum and it is “high time” they settle on an agreed plan.
Writing in today’s Daily Telegraph, Lord Hague says that if Mrs May’s landmark Brexit speech in Florence on Friday fails to unite the Cabinet, “Jeremy Corbyn will be prime minister”.
As the Prime Minister prepares to set out her vision for post-brexit Britain in her speech, a fresh Cabinet row has emerged over what sort of deal the Government should aim for.
Boris Johnson, the Foreign Secretary, and Michael Gove, the Environment Secretary, favour a deal similar to the one being negotiated with the EU by Canada, which eliminates 98 per cent of trade tariffs and involves a clean break from Brussels.
But Philip Hammond, the Chancellor, and Amber Rudd, the Home Secretary, are said to favour a Swiss-style arrangement, in which Britain could pay to access the single market.
At a press conference in Canada last night, Mrs May insisted she did not face a “binary choice” between the two models as Britain was pursuing its own bespoke deal.
Following days of in-fighting, Mrs May attempted to regain control of the Brexit process by appointing Oliver Robbins, the UK’S chief day-to-day Brexit negotiator, to a new post where he will report directly to her rather than his old boss, David Davis, the Brexit Secretary.
She also issued a put-down to Mr Johnson, described as a “backseat driver” on Brexit at the weekend, by saying: “The Government is driven from the front.”
The discord over Brexit was further highlighted when Mark Carney, the Governor of the Bank of England, who works closely with Mr Hammond, used a speech in Washington DC to make a series of gloomy predictions about the effects of leaving the EU.
He said the referendum result was “a real shock about which monetary policy can do little” and said it would lead to “weaker real incomes” as well as higher inflation and increased interest rates.
He also suggested that “abrupt decreases in migration” could lead to labour shortages that would have a detrimental effect on the economy.
Mr Johnson seized the Brexit agenda last week when he set out his own detailed vision for Britain’s future in an article for The Daily Telegraph, and it has now emerged that he fears that Mrs May will use Friday’s speech to signal a Swiss-style deal that would yoke Britain to EU laws and regulations. Switzerland pays for access to the single market but does not contribute to other EU funds such as the Common Agricultural Policy.
It also accepts freedom of movement but is not part of the customs union. Its arrangement means it has to abide by vast swathes of EU regulations.
According to a House of Commons research paper, such an arrangement would mean Britain paying 40 per cent of what it currently does, or £4billion per year.
Mr Johnson, who met President Donald Trump in the US yesterday, warned that Britain must not agree to pay “extortionate sums” for access to the single market, adding: “They would not pay us for access to our market.”
He also said it was “pretty important” that any transition period “should not be too long” while conceding that Britain would have to pay what it is “on the hook for” in the short term.
Mr Johnson is furious that the Cabinet met behind his back to discuss Brexit while he was in the Caribbean surveying hurricane damage, and believes that Mr Hammond and Ms Rudd used the opportunity to lobby for a Swiss-style deal, known as European Economic Area Minus, or EEA-.
Instead, Mr Johnson and Mr Gove are pressing for a deal that is more akin to Canada’s Comprehensive Economic
and Trade Agreement (Ceta) that removes 98 per cent of trade tariffs.
The Foreign Secretary will meet Mrs May in New York today or tomorrow for a showdown over the content of her Florence speech as they both attend the United Nations General Assembly.
Meanwhile, Dominic Cummings, the former campaign director of Vote Leave and a close friend of Mr Gove, suggested that the Cabinet had been “led like lambs to the slaughter” by Sir Jeremy Heywood, the powerful Cabinet Secretary.
He suggested that backing Mr Johnson and Mr Gove gave Tory MPS “a shot of saving your skins”, while backing Mr Hammond meant the Government would be “in dire danger”.
But Mrs May said there was a third way that did not involve a Ceta or a Swiss-style deal.
Speaking in Canada, she said: “I don’t recognise the simple binary approach. I have always said we are not looking to take a model off the shelf or a relationship that currently exists because the position of the UK is unique.
“We are already in the European
Union.
“We have the relationship with the EU already and when we come out we want to ensure we can negotiate a good deal, a bespoke deal, a deal that is right for the United Kingdom and that would be in the economic interests of the European Union as well.”
Mrs May has invited Mr Johnson, Mr Hammond and Mr Davis to Florence but Mr Johnson has not yet confirmed whether he will accept the invitation.