Johnson and Gove back a bigger Brexit divorce bill offer
"Any offer would be determinant on the overall progress of the negotiations, so it's not a case of 'take that money and bank it', because moving forward has to be done together."
Whitehall source
BRITAIN: Boris Johnson and Michael Gove have agreed for the first time that Britain should increase its Brexit divorce bill offer above £20 billion (NZ$39b) if the European Union is prepared to make concessions in return.
The Cabinet’s leading Brexiteers dropped their longstanding opposition to a promise of more money to the EU, paving the way for David Davis, the Brexit Secretary, to break the deadlock that has so far prevented trade talks from starting.
However, they and other ministers made it clear that no specific monetary offer should be made at this stage, with any extra cash to Brussels being dependent on Britain getting a good deal.
The Government faced an immediate backlash from Leavesupporting Conservative MPs, who insisted the £20b already offered was enough.
One MP warned voters would go ‘‘bananas’’ if the offer was eventually increased to £40b, as had been rumoured, while Chancellor of the Exchequer Philip Hammond was told that any tax increases in tomorrow’s Budget would be interpreted as taxpayers’ pockets being picked to pay for the Brexit bill.
It came as Michel Barnier, the EU’s chief Brexit negotiator, said the EU will reject any future free trade agreement with Britain if it involves the UK undercutting European regulations.
The chances of agreeing a trade deal before Britain leaves the EU in March 2019 were also dealt a blow when Angela Merkel, the German chancellor, suggested she might have to call another general election after failing to form a minority government. Such a move could lead to months of uncertainty for the EU’s most powerful nation.
Prime Minister Theresa May spent two hours chairing a meeting of the 10-strong Brexit Cabinet sub-committee yesterday, at which no figure for the final Brexit divorce bill was discussed.
But Whitehall sources said the ministers, who included Mr Johnson, Gove and Liam Fox, the Brexit-supporting International Trade Secretary, reached a consensus over the need to tell the EU that more money will be made available as long as a good trade deal is on offer.
One source said: ‘‘Any offer would be determinant on the overall progress of the negotiations, so it’s not a case of ‘take that money and bank it’, because moving forward has to be done together.’’
A Downing Street spokesman said: ‘‘It remains our position that nothing’s agreed until everything’s agreed in negotiations with the EU. As the prime minister said this morning, the UK and the EU should step forward together.’’
Davis will pass on the news to Barnier in the expectation that Brussels will agree to begin trade talks when EU leaders meet for a key summit in December.
However, Robert Halfon, a Conservative MP and former minister, warned: ‘‘If we start saying that we’re going to give £40b to £50b to the EU, I think the public will go bananas.
‘‘I cannot believe that the public would accept such a huge amount when we need money for our schools, our hospitals, our housing and many other things.’’
Government sources last night played down reports that the Cabinet committee had agreed to allow the European Court of Justice to oversee the rights of EU migrants living in the EU permanently after Brexit.
Meanwhile, Barnier made it clear any attempt to lure investment away from the EU would scupper a trade deal. He said if Britain promised to adhere to EU standards Brussels would offer ‘‘its most ambitious free trade agreement’’.
He also insisted that London’s financial services sector would lose its seamless access to the EU’s single market and banks would lose their unfettered access to EU markets after Brexit.
– Telegraph Group