“Brexit is the choice of the British people... pushed by those who predicted easy solutions... Those people are liars.’’
Scathing Macron warns Britain it must climb down further if it wants a deal May humiliated by European leaders who reject Chequers as unworkable Disastrous negotiations threaten PM’S leadership ahead of Tory conference
THERESA MAY was humiliated by European Union leaders in Salzburg yesterday as they unanimously rejected her Chequers plan as unworkable.
The Prime Minister was left visibly furious after Emmanuel Macron, the French president, said Brexit had been sold to the British public by “liars” and that Mrs May needed to come up with “new propositions” if she wants to salvage a deal.
Mrs May had gone to Austria expecting warm words of encouragement from her fellow leaders, but instead Donald Tusk, the president of the European Council, said key parts of Cheq- uers “will not work” in a brutal assessment of Mrs May’s proposal.
His rejection of Chequers appeared to rattle the Prime Minister, who faced the media less than 10 minutes later and pronounced: “Let nobody be in any doubt: as I have always said, we are preparing for no deal, so that if we get to the position where it’s not possible to reach a deal then the British people can be confident that we will have done what is necessary to ensure we make a success of leaving the EU.”
Downing Street signalled last night that Mrs May could offer concessions over regulatory controls for goods crossing the Irish Sea in a move that her critics are likely to characterise as a climbdown.
It comes in the run-up to what seems certain to be a turbulent Conservative Party conference at which Mrs May will face intense pressure from Eurosceptics to abandon Chequers in favour of a Canada-style Free Trade Agreement (FTA) with the EU.
Her premiership could also come under threat if MPS who have lost confidence in her ability to deliver Brexit decide the only way to change direction is to change leader.
Mrs May was given just 10 minutes to convince the other 27 leaders of the merits of Chequers during a dinner on Wednesday night, but her efforts fell on deaf ears as she was forced to listen to Mr Macron and others lining up to savage it yesterday.
Mr Macron said there was “consensus” among the EU27 that the UK’S proposals were “not acceptable” in their current form.
In an attack clearly aimed at Boris Johnson and the leaders of the Leave campaign, he went on: “Brexit is the choice of the British people and it is a choice pushed by certain people who predicted easy solutions.
“Brexit has shown us one thing... those who said you can easily do without Europe, that it will all go very well, that it is easy and there will be lots of money, are liars. This is all the more true because they left the next day, so they didn’t have to manage it.” Mr Tusk, who held “frank” face-to-face talks with Mrs May yesterday, said: “Everybody shared the view that while there are positive elements in the Chequers proposal, the suggested framework for economic cooperation will not work, not least because it is undermining the single market.”
Angela Merkel, the German chancellor, said “substantial progress” was needed in the coming weeks.
Mr Macron seized control of the agenda by insisting Mr Tusk retract an announcement of a special EU summit in November to thrash out the final details of a Brexit deal. Instead, Mr Tusk said the regular meeting of EU leaders on Oct 18 would be “a moment of truth”.
He said another summit would be held in November only if “maximum progress” had been made by October.
Mrs May responded by challenging the EU to come with a workable alternative to Chequers as she made it clear a no-deal Brexit was now a step closer.
She said: “Concerns have been raised. I want to know what those concerns are. On the economic partnership, there is no solution that will resolve the Northern Ireland border which is not based on the frictionless movement of goods.
“Our White Paper remains the only serious and credible proposition on the table for achieving that objective.”
Mrs May insisted she would be sticking to her guns, saying she had always expected “negotiations would be tough and tactics would be used”. She said the UK would “shortly” come forward
It was death by a thousand cuts, but when Donald Tusk administered the coup de grace on Theresa May’s Chequers plan in Salzburg yesterday, there was still a sharp intake of breath among those who had – encouraged by delusions in Downing Street – clung to the belief it could survive.
“It will not work,” said the president of the European Council in his customary matter-of-fact style, “because it risks undermining the single market”.
This cannot have come as news. Michel Barnier has been saying for months now that the EU cannot risk undermining the “four freedoms” of goods, services, capital and movement that undergird the EU’S single market.
Until yesterday, Downing Street has been in denial. It believed that when Mrs May got her fellow EU leaders in the room, they would show more flexibility than Michel Barnier and the “theologians” in Brussels who she blamed for such a narrow, blinkered approach to the negotiation.
But the chiefs have spoken, and they have apparently come to the same conclusion as Mr Barnier – that the customs and trade part of Chequers was “cherry-picking” and posed a systemic threat to the economic and political future of their union.
Mr Tusk pushed the blade up to the hilt by posting a picture of himself on his Instagram account offering Mrs May a pastry, alongside the caption: “A piece of cake, perhaps? Sorry, no cherries.”
And here lies the point: to the EU the Chequers plan was an exercise in denial that allowed Mrs May to avoid the hard choices presented by Brexit and her decision to leave the customs union and single market.
Her “dual tariff ” customs scheme could, in theory at least, allow the UK to pursue an independent trade policy while maintaining the benefits of the EU market for carmakers and chemical plants and avoiding a hard border in the Irish Sea.
But to the EU it was a “unicorn”, a piece of “magical thinking” that, even if it could be made to work technically (and the British maintained it could) was never in the interests of the EU.
They saw it as an attempt by Mrs May to protect British industrial supply chains (which were reliant on that customs union and single market) while still being free to diverge, allowing Britain to set different tariffs and standards to the EU, while at the same time retaining friction-free access to the EU. Put another way, Chequers was reaping the benefits of a customs union and single market, while leaving the customs union and single market. It could not work.
The EU’S rejection of Chequers was therefore not – as is often contended by the British – an act of theological cleavage to the single market, but in their view a piece of hard-nosed self-interest. The European Commission’s economists said it simply presented too great a risk.
Again, this cannot have come as a surprise to the British. On July 5, on the eve of the Chequers summit, the EU’S Brexit ambassadors were shown a slide presentation by Mr Barnier’s team which warned that allowing the UK to enter into a “single market for goods” would be disastrous.
Stephanie Riso, the top economist in Mr Barnier’s team, said it would lead to a “level of erosion in the single market” over a 15-year period roughly equal to the impact of a “no deal” exit for the UK – or 8-9 per cent of GDP.
In other words, it would leave the EU carrying the costs of the British vote to leave. The numbers were so toxic that when the British got wind of the presentation, they were forced to intervene “at the highest” level to suppress their publication.
The stay of execution was designed, on the EU side, to give the British a chance to prove that Chequers wasn’t the threat they feared.
The British argued that the “level playing field” guarantees, where Britain promised to remain aligned with the EU’S rules on state aid and keep a Common Rulebook on border checks, addressed EU concerns about competitive advantage.
They did not. “When we first saw the White Paper that followed Chequers”, one EU diplomat said, “we didn’t even know where to start, it was so far from acceptable.”
Mr Barnier made no secret of his objections. He warned that since 20-40 per cent of the value of goods is comprised of services – and Chequers left the UK free to obtain competitive advantage by diverging on services – the EU could never agree.
“I am often accused in the United Kingdom of being dogmatic,” Mr Barnier wrote on Sept 2 in a newspaper article. “In fact, I only fulfil our fundamental interests.”
British officials did their best to protest. The UK, they argued, would have to “become like the Wild West” to reap such notional advantages, predicting that the EU’S political leaders would understand that the Commission was putting dogmatism over the practical need for a deal.
It now seems they were wrong. The 27 EU states do have divergent and competing interests, but they are remarkably united on the defence of the single market.
They appear to accept Mr Barnier’s argument that even incremental competitive advantages of one or two
‘I am often accused in the United Kingdom of being dogmatic. In fact, I only fulfil our fundamental interests’
per cent, when aggregated over time, will indeed pose a threat to EU economies.
It was not made public, but when Dominic Raab, the Brexit Secretary, met Mr Barnier earlier this month to discuss the future relationship, he was absolutely clear: the Chequers proposals on goods trade, the Common Rulebook and customs cooperation were “neither workable nor desirable”.
And yet Mrs May went to Salzburg to demand her fellow leaders engage with her ideas or at the very least (as one British official said on the eve of the summit) to “keep them on life support”.
The hope, perhaps, was that by retaining at least the theoretical possibility that circles could be squared and unicorns did exist, it might be possible to convince all sides to sign off on the Withdrawal Agreement and the dreaded Irish backstop.
But instead of fudge, we now have a moment of clarity. Emmanuel Macron, the French president whose arguments appear to have triumphed at Salzburg, made no attempt to shade Mrs May from the import of what happened.
“Brexit is the choice of the British people… pushed by those who predicted easy solutions,” he said. “Those people are liars. They left the next day so they didn’t have to manage it.”
So now, in the absence of an “easy solution”, it seems as if Brexit enters a new world of hard choices in the run-up to the Oct 18 meeting of the European Council.
The EU remains focused on signing a Withdrawal Agreement – a divorce deal – which must include an Irish backstop that guarantees an invisible, frictionless border between the EU and Northern Ireland in any eventuality.
At present, that backstop, which Mr Tusk was equally clear must be signed for the UK to get a divorce deal with its precious transition period, leaves a customs border in the Irish Sea.
Mrs May says she will not – and cannot – agree to this, since it would rupture her own “precious union”. Her Chequers plan, she said with an air of growing desperation, is the “only serious and credible proposal” that allows for both Brexit and an invisible border.
Well, not quite. As Mr Macron said, there are other solutions, but they are just not easy.
Mrs May could agree to join a customs union with the EU, as Mr Barnier has offered, which would
‘Brexit is the choice of the British people… pushed by those who predicted easy solutions’
obviate the need for customs checks in the Irish Sea.
It would protect UK business, but end the ability to set tariffs independently.
Or she can “swallow” the Irish backstop as conceived by Europe, which would put a “de-dramatised” customs border in the Irish Sea, at the risk of losing the support of her Democratic Unionist Party partners in Westminster.
Both of these options would allow for the signing of an orderly divorce deal and open negotiations on a free-trade agreement with Europe, along with a host of ancillary cooperation agreements.
Or she can walk away, trade on “WTO terms”, refuse to erect a border in Northern Ireland and let Brussels and Dublin scrap over what to do about it – a position that Europe does not believe is truly sustainable, and which the UK Parliament would almost certainly not allow.
It has been a mantra of the European Union negotiators that the UK must “face up to the consequences” of the Brexit vote.
Last December, both sides agreed to fudge the really hard issues in the Joint Report.
However, this December it seems they will not.