We must push for agreement with a plus

For all the apparent vagueness surrounding Brexit, the Government’s policy has actually been remarkably consistent. Last November an aide was photographed in Downing St carrying papers for a ministerial discussion which outlined some of the options for Brexit. Foremost among them was something called “Canada-plus”. This translates as a Comprehensive Economic and Trade Agreement (Ceta) as hammered out between the EU and Canada, with bits added – principally, financial services.

On The Andrew Marr Show on the BBC yesterday David Davis, the Brexit Secretary, reaffirmed that this is indeed the Government’s aim, though it is now “Ceta-plus-plus-plus”. This would take the UK out of the single market and the customs union, as Theresa May has promised, while retaining as much frictionless trade, both in goods and services, as is realistically possible.

Mr Davis said he did not recognise suggestions among hard-line Brexiteers – and the Labour Party – that the deal struck on Friday to move on to the next stage of talks implied a so-called “soft” Brexit in which the UK effectively stays in or mirrors the single market. That impression has arisen largely because of the ambiguities in the document surrounding the future of the Irish border and the need to ensure that Northern Ireland remains an integral part both of the UK and of a free trade area with the Republic of Ireland. Mr Davis said the section on regulatory alignment was more of a statement of intent than a binding protocol, which caused some surprise in Dublin.

A Canada-plus trade agreement would help square the circle. However, what we do not know yet is whether the EU will be happy to give the UK such a deal. No non-eu member state has ever negotiated trade terms with the EU that extend to services, particularly financial services. But Mr Davis signalled that the Government is prepared to leverage the UK’S position under which it has agreed to give the EU some £39 billion net as a farewell payment. He said this would only be forthcoming if we get a trade deal, confounding suggestions by Philip Hammond, the Chancellor, that it would be paid come what may.

There will be obligations that will have to be met, even without a deal. But, as Mr Davis said, the chances of getting one have now improved, so we should not be shy to use the financial promises we have made to persuade the EU that it would be in their interests to agree.