Posts Tagged ‘Philip Hammond’

UK Chancellor Philip Hammond refuses to say whether Brexit is ‘worth it’

March 12, 2018

Theresa May eventually replied ‘yes’ when asked if it was worth paying the predicted price of leaving the EU

By Rob Merrick Deputy Political Editor
The Independent

Chancellor Philip Hammond refuses to say that Brexit is ‘worth it’
Philip Hammond

The Chancellor refused to say that Brexit is “worth it” as he insisted the Government has yet to model the economic effects of its hoped-for exit deal.

Theresa May replied “yes” when asked if it was worth paying the predicted price of leaving the EU, when quizzed by MPs in the Commons last week.

But, asked the same question on the BBC’s Andrew Marr ShowPhilip Hammond declined to say he believed that Brexit was in the interests of the British people.

“The British people have decided that we are leaving the European Union and that is what we are doing. Our job is to make sure that we get the best possible deal for Britain,” he replied.

It was possible to achieve a “smart Brexit” that would protect jobs, prosperity and businesses, Mr Hammond added.

The Government has dismissed its own leaked forecasts warning of a severe economic hit from leaving the EU, on the basis they did not model the preferred outcome.

Asked if that exit deal that Britain hoped to achieve had been studied by Treasury officials, Mr Hammond said: “Not yet – we haven’t even embarked on the negotiation yet.”

He hinted at doubts over agreeing a transition deal, of about two years, at next week’s EU summit, saying only that it would “hopefully” be agreed.

“Then we start talking with them about a shape of a future partnership. Once we know what the deal looks like, then we will certainly model it,” the Chancellor said.

The timetable will raise doubts over the Government’s pledge to show the full Brexit modelling to MPs before a “meaningful vote” on the Prime Minister’s deal this autumn.

Any agreement is unlikely to be reached before October, giving little time for the Treasury work to be carried out before the vote.

Looking ahead to the Spring Statement on Tuesday, Mr Hammond insisted he would not relax his grip on the public finances, despite seeing “light at the end of the tunnel” for the economy.

Britain’s debt mountain – at £1.8 trillion – was still too high and had to be brought down.

“There is light at the end of the tunnel because what we are about to see is debt starting to fall after it has been growing for 17 continuous years. That is a very important moment for us but we are still in the tunnel at the moment,” the Chancellor said.

He added: “All the international organisations recognise that [Britain’s debt] is higher than the safe level.

“This isn’t some ideological issue. It is about making sure that we have the capacity to make sure that we can respond to any future shock to the economy.”

For Labour, Shadow Chancellor John McDonnell said the Government’s approach was not working and it needed to change direction.

“Austerity is holding growth back. Wages are below what they were in 2007-08, so this isn’t a matter for celebration,” he told the same programme.

“What he [Mr Hammond] has done, very cleverly, very cunningly, he has shifted the debt onto the shoulders of NHS managers, onto the shoulders of headteachers and onto the shoulders of local government leaders.”


We’re not out of austerity tunnel yet – Chancellor Philip Hammond

BBC News

Chancellor Philip Hammond has rejected calls by Labour and some Conservatives to announce the end of austerity in his spring statement on Tuesday.

He is expected to unveil the smallest budget deficit since 2002, thanks to better than expected public finances.

But he told the BBC national debt was still too high, adding: “There is light at the end of the tunnel… but we are still in the tunnel at the moment.”

Labour has urged him to end the “pain and misery” of public spending cuts.

Mr Hammond told the Andrew Marr Show it would be wrong to pour “every penny” into additional public spending.

He said it was “very important moment” to see debt starting to fall after growing for 17 continuous years.

But he said: “We should be very careful looking at single sets of figures – one quarter or two quarters – we need to look at what’s happening sustainably in the economy.”

The day-to-day deficit has been eliminated, it emerged earlier this month, two years later than former chancellor George Osborne had wanted when he set out in 2010.

The UK is now running a surplus of £3.8bn in its current budget – the money borrowed to fund day-to-day spending rather than long-term investment – according to the Office for National Statistics.

“We have a debt of £1.8 trillion – 86.5% of our GDP,” Mr Hammond said. “All the international organisations recognise that is higher than the safe level.”

Debt ‘horror’

Mr Hammond told the BBC that “we need to get our debt lower”.

“I think most people in this country would be horrified to be reminded that we have £65,000 worth of public debt for every household in this country,” he said.

The chancellor is due to announce a half-yearly update of Britain’s public finance figures on Tuesday, but confirmed he would not be delivering any new tax or spending measures.

“If there is the flexibility and the space to do something, then we will decide in the autumn how we are going to use that,” he said.

Economists expect the chancellor will announce borrowing is set to be around £7bn lower in 2017-18 than had been predicted, when he unveils the latest forecasts of the Office for Budget Responsibility.

Also appearing on Andrew Marr, John McDonnell, the shadow chancellor, called on the government to end its austerity programme.

He said recent economic figures were “not a matter for celebration” – and said the chancellor “should be coming into the real world”.

He said Mr Hammond had “shifted the deficit onto the shoulders of NHS managers, headteachers and onto the shoulders of local government leaders.

“They’re facing a financial crisis because of government cutbacks,” he told Marr.

John McDonnell says he won’t appear on Russia Today

He called the government’s plans for an NHS pay deal “miserly and mean-spirited”.

“Pay is at the moment just about matching inflation, that’s all,” he added.

Mr McDonnell has called on the government to use its spring statement to end what Labour called an “immediate crisis” in public services.

But Mr Hammond vowed to “look at the numbers” in the autumn Budget.

He said: “Local authorities have done an incredible job in delivering efficiencies,” adding: “Of course they’re under some pressures”.


Labour: Jeremy Corbyn to pile pressure on Theresa May with customs union policy shift

February 26, 2018

The Prime Minister is scrambling to agree Britain’s approach to the future relationship with the EU by Friday

By Lizzy Buchan Political Correspondent
The Independent



Jeremy Corbyn will today create a clear Brexit dividing line between Labour and the Tories in a keynote speech which will see him finally commit to keep the UK in a European customs union.

The Labour leader will argue the move would enable his party to secure “full tariff-free access” to the single market but without committing to all of its rules, allowing him to negotiate exemptions on freedom of movement and workers’ rights.

The move ends months of speculation about Mr Corbyn’s stance on the issue, which goes to the heart of the debate about Britain’s future.

It also simultaneously heaps pressure on Theresa May as pro-EU Tory rebels are poised to join Labour and force her to keep the UK in the customs union.

The Prime Minister is scrambling to agree Britain’s approach to the future relationship with the EU by Friday, as Brexiteers also threaten her leadership from the right, if she fails to seek a deal that allows the UK to agree trade deals – something staying in the customs union would preclude.

In a much-anticipated speech in Coventry, Mr Corbyn will say: “Britain will need a bespoke relationship of its own. Labour would negotiate a new and strong relationship with the single market that includes full tariff-free access and a floor under existing rights, standards and protections.

“That new relationship would need to ensure we can deliver our ambitious economic programme, take the essential steps to upgrade and transform our economy, and build an economy for the 21st century that works for the many, not the few.”

Mr Corbyn will add: “We cannot be held back, inside or outside the EU, from taking the steps we need to support cutting-edge industries and local business, stop the tide of privatisation and outsourcing or prevent employers being able to import cheap agency labour from abroad to undercut existing pay and conditions.”

It comes after Shadow Brexit Secretary Sir Keir Starmer suggested that Labour would join forces with Tory rebels to force Ms May to put membership of the customs union back on the table.

The Labour leader will also promise to use funds returned from Brussels after Brexit “to invest in our public services and jobs of the future, not tax cuts for the richest”.

His speech is likely to disappoint those in the party who favour a softer Brexit, as a group of more than 80 MPs, peers and union leaders told Mr Corbyn that Labour would “never be forgiven” if it backed leaving the single market.

The alliance, including prominent Labour figures such as Chuka Umunna and Lord Kinnock, warned that the move would risk a “multi-billion pound hit to the public finances” and make the party’s manifesto plans for schools, hospitals and social care unaffordable.

Responding to the speech, Mr Umunna welcomed moves to put “clear red water” between Labour and the Tories but warned that the only way to retain the benefits of the single market and the customs union – and to avoid a hard Irish border – was to stay in both agreements.

He added: “It is the best anti-austerity policy too because it avoids a huge negative impact on revenues to the Exchequer if we Brexit.”

Liberal Democrat Brexit spokesperson Tom Brake said Labour’s plans to protect jobs were a “meaningless and totally undeliverable soundbite” if Britain leaves the single market and urged Labour to change course.

He said: “If Jeremy Corbyn carries on down this path of ‘having your cake and eating it’, it would be another betrayal to those who believe that strong public services have to be underpinned by a strong economy, and Britain staying in the single market and customs union is crucial to that.”

Ms May faces a challenging week, ahead of a major Brexit speech on Friday where she is expected to outline long-awaited plans for Britain’s future relationship with the EU.

She will also host a special Cabinet meeting on Thursday to ensure her top team are behind the plans, following months of in-fighting between Eurosceptics led by Boris Johnson and Michael Gove, and Philip Hammond’s pro-EU allies.

It comes amid reports several senior ministers have warned her that Tory rebels could bring down the Government if they joined forces with Labour to block her plans to take Britain out of the customs union.

However, Ms May struck an upbeat note, saying: “Delivering the best Brexit is about our national future, part of the way we improve the lives of people all over the country.

“If we get them right, Brexit will be the beginning of a bright new chapter in our national story, and our best days really do lie ahead of us.”


UK ideas on post-Brexit ties are ‘pure illusion’, EU’s Tusk says

February 23, 2018


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European Council President Donald Tusk

BRUSSELS (Reuters) – European Council President Donald Tusk on Friday dismissed as “pure illusion” the ideas floated by Britain so far on what sort of relationship it would want with the European Union after it leaves the bloc.

Tusk said he hoped to get more clarity when he meets Theresa May next Thursday, a day before the British prime minister is due to deliver a speech to outline London’s vision of its future ties with the EU.

“I am glad that the UK government seems to be moving towards a more detailed position,” Tusk told journalists after 27 EU leaders – all apart from May – met in Brussels on Friday.

“However … I am afraid that the UK position today is based on pure illusion. It seems like the ‘cake’ philosophy is still alive. From the very start it has been a key clear principle of the EU 27 that there can be no cherry-picking and no single market ‘a la carte’.”

British Foreign Secretary Boris Johnson has said he wants Britain to get the best of both worlds – to “have its cake and eat it”.

EU leaders have long been asking May for details of London’s vision for future relations, but she has been hampered by divisions within her ruling Conservative Party, with some backing close trading ties and others seeking a “clean break”.

Tusk said the remaining 27 EU states would adopt their joint stance on that in March, whether London provided input or not. Tusk said the bloc would be “extremely realistic in our assessment of possible new proposals”.

Dutch Prime Minister Mark Rutte, who saw May this week, echoed those comments in talking to reporters separately after the Brussels meeting.

“I made it clear to Theresa May that I believe it is crucial for the UK to set out its position on the transition, on issues like the Irish border, and particularly on the future relationship,” he said.

“We don’t like cherry-picking, so it will be difficult to come to a bespoke deal along the lines that some in the UK are suggesting.”

Additional reporting by Samantha Koester and Philip Blenkinsop; Editing by Kevin Liffey


Theresa May expected to set out Brexit plan Friday after Cabinet agreement at Chequers

February 23, 2018


© AFP/File / by Alice RITCHIE | British Prime Minister Theresa May is under pressure to set out more details of her position before talks get underway on the future partnership in April, with Brussels warning Britain cannot have everything it wants
LONDON (AFP) – Prime Minister Theresa May will make a speech next Friday on Britain’s relationship with the EU following Brexit after her cabinet agreed a plan at a marathon meeting, her spokesman said.One minister who was not present said they had agreed Britain would seek to align itself with European Union rules in certain sectors of the economy, but will retain the right to diverge.

May is under pressure to set out more details of her position before talks get underway on the future partnership in April, with Brussels warning Britain cannot have everything it wants.

The prime minister gathered around a dozen of her senior Cabinet colleagues for eight hours of talks at her country retreat Chequers on Thursday, in a bid to thrash out their considerable differences.

Foreign Secretary Boris Johnson, who has called for a clean break with Brussels, and Finance Minister Philip Hammond, who favours closer ties, were among those present.

“It was a very positive meeting and a step forward, agreeing a basis of the prime minister’s speech on our future relationship,” the spokesman said.

“The prime minister will be setting out more detail of the government’s position on Friday,” he added on her upcoming address.

Health Secretary Jeremy Hunt, who did not attend the gathering, said Britain would not be part of a customs union with the EU because it wanted to be able to agree trade deals beyond the bloc.

“It’s one way of getting frictionless trade but it’s not the only way,” he told BBC radio.

He acknowledged “divergent views” among ministers, but said: “The central common understanding is that there will be areas and sectors of industry where we agree to align our regulations with European regulations.

“The automotive industry is perhaps an obvious example because of supply chains that are integrated.

“But it will be on a voluntary basis, we will as a sovereign power have the right to choose to diverge, and what we won’t be doing is accepting changes in rules because the EU unilaterally chooses to make those changes.”

– Labour sets out plan –

The full Cabinet will discuss the plans, likely at their regular weekly meeting on Tuesday, before May makes her speech.

The address is expected to take place somewhere in Britain, after recent big Brexit speeches in Munich, Germany, and Florence in Italy.

A few days before, on Monday, opposition Labour leader Jeremy Corbyn is expected to set out his party’s vision for Brexit, with growing speculation he could call for maintaining some kind of customs union with the EU.

Any deal agreed with Brussels would have to be passed by the House of Commons, where May’s Conservatives have only a slender majority.

The prime minister has pledged to leave the EU’s single market and customs union, as she seeks to end free movement of migrants and the jurisdiction of the European Court of Justice.

But EU chief negotiator Michel Barnier has warned that these freedoms will come at a cost of “unavoidable” barriers to trade.

Members of the EU’s customs union — the bloc’s 28 states plus Turkey, Andorra, Monaco and San Marino — agree common customs duties, import quotas and other rules in return for allowing goods to move freely through the area.

Remaining in a customs union would resolve concerns about the return of checks on the border between EU member Ireland and Northern Ireland, part of Britain.

But members of the customs union are precluded from signing their own independent trade deals, something many eurosceptics in Britain highlight as a crucial benefit of Brexit.

by Alice RITCHIE



UK bid to agree Brexit line faces EU scepticism

February 23, 2018


May’s aim for cabinet unity around ‘Canada plus’ model unlikely to impress Brussels

The UK prime minister faces a fundamental dilemma: avoiding flare-ups at home may only store up trouble in Brussels © FT Montage/AFP/Getty

By Alex Barker and Jim Brunsden in Brussels and George Parker in London
Financial Times (FT)

Theresa May on Thursday night hammered out a British strategy for future ties with the EU — but was warned by a fellow European leader over the way ahead even before a Brexit Cabinet meeting had begun.

Meeting the British prime minister in Downing Street on Wednesday, 24 hours before the Chequers summit, Mark Rutte, Mrs May’s Dutch opposite number, urged her to ditch the idea of a “three baskets” trade deal.

This idea, floated by Mrs May in the past, seeks to divide a post-Brexit order into three areas; one where the UK maintains the same regulation as the EU; another where it uses rules of its own for the same outcomes; and a third where the UK takes a fundamentally different approach.

“It would be better to say nothing at all,” Mr Rutte said, according to officials familiar with Wednesday’s meeting.

His blunt assessment captures the fundamental dilemma facing Mrs May as she seeks to unify her government around a common line: avoiding flare-ups at home may only store up trouble in Brussels.

For Mr Rutte and other EU27 leaders, the onus is on Mrs May to set out a credible plan that is “clear” and free from hybrid constructions that mask an unwillingness to make choices.

“One has to accept the costs [of different models],” said one senior EU diplomat. “There is a tendency in the UK for politicians to mention lots of different specifics they would like. What we want is coherence, realism. I’m not saying it is easy.”

A senior French official said: “We don’t need lots of details. The issue is: can the UK government simply say they want a free-trade agreement?”

Some British ministers also favour a more conventional free-trade deal rather than a broader accord with Brussels.

On Wednesday the European Commission circulated a 58-page document to EU27 member states making it plain that whatever compromise were agreed at Chequers, it was unlikely to fly.

Preserving the integrity of the single market excludes sector-by-sector participation

It includes a “staircase” chart that shows how, if Mrs May sticks to her negotiating red lines, the only option available is a traditional, unvarnished free-trade agreement along the lines of the EU deals with Canada and South Korea.

More worrying for British officials, it also suggests that even bending the UK’s position on respecting the rulings of European courts would not alone be enough to secure privileged single-market style access in areas such as aviation.

That requires the full EU’s full regulatory “ecosystem”: the institutions enforcing and supervising compliance and developing law. Meeting high regulatory standards is necessary but not sufficient.

The paper reinforces the strong view that Britain cannot cherry-pick single market membership in certain sectors. It says: “Preserving the integrity of the single market excludes sector-by-sector participation.”

Michel Barnier, the EU chief negotiator, has also pointed out that no trade deal in the world has a big section on the financial services sector.

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Brexit negotiator Tim Barrow will give a taste of how the EU might respond to Britain’s demands © Reuters

For the Remain faction in Mrs May’s Brexit negotiation cabinet committee, led by Philip Hammond, the chancellor, an agreement based on the Canada trade agreement is not ambitious enough and he will continue fighting for a better deal.

Parliament will have a much bigger voice in the final outcome than some people think

Pro-Remain minister

Mr Hammond argues that Britain must have a much closer relationship, including some kind of customs union with the EU. “Hammond always says in cabinet it’s the only way we can start to address the Irish border question,” says one minister.

While many EU countries would be eager to maintain a customs union with Britain, Mrs May will find it difficult to keep the option open without enraging Brexiters.

Jacob Rees-Mogg, the leading Tory Brexiter, wrote in The Daily Telegraph on Thursday that Northern Ireland was “an imaginary problem” being presented by Remainers as to an “impassable obstacle to a genuine Brexit”.

However, Remainers believe that even if the Irish border question does not propel Mrs May towards a softer Brexit, she may be forced to do so by parliament, with pro-European Tories and Labour privately working together to keep Britain in a customs union.

“Parliament will have a much bigger voice in the final outcome than some people think,” said one pro-Remain minister.

By the time the ministerial cars headed down the Chequers driveway on Thursday night, Mrs May had cobbled together a delicate cabinet position on Brexit; whether it can survive contact with the reality of Westminster and Brussels politics is a much bigger question.

Bank of England Signals Faster Rate Rises, Boosting Sterling

February 8, 2018

Central bank keeps rate unchanged

Image may contain: people standing and outdoor

LONDON—The Bank of England said Thursday that it expects to raise interest rates in the U.K. at a swifter pace than it anticipated last year, responding to stronger growth in the global economy.

The BOE’s message comes as investors worry that more rapid growth could fuel higher inflation and a more aggressive response from global central banks. Those worries have helped prompt selloffs in world financial markets this week.
BBC News

Bank of England hints at earlier and larger rate rises

Bank of England Governor Mark Carney

The Bank of England has indicated that the pace of interest rate increases could accelerate if the economy remains on its current track.

Bank policymakers voted unanimously to keep interest rates on hold at 0.5% at their latest meeting.

However, they said rates would need to rise “earlier” and by a “somewhat greater extent” than they thought at their last review in November.

Economists think the next rate rise could come as soon as May.

The value of the pound initially jumped almost 1% against the dollar, but fell back to about 0.5%.

Higher interest rates have an important effect on households and the economy.

Around 8.1 million UK households have a mortgage, and of those almost half are on either a standard variable rate or a tracker rate.

Interest rates on those types of mortgages would be likely to match any increase in official rates made by the Bank of England.

But for savers a move higher by the Bank of England could be a bonus, as High Street banks generally have to raise their rates of interest.

UK interest rate graphic

In November, the Bank raised the cost of borrowing for the first time in more than 10 years – from 0.25% to 0.5%.

Its forecasts at the time indicated there could be two more increases of 0.25% over three years.

But it now appears there could be a third increase and those rises could be sooner than expected.

“The Committee judges that… monetary policy would need to be tightened somewhat earlier and by a somewhat greater extent over the forecast period than anticipated at the time of the November report,” minutes from the Monetary Policy Committee’s (MPC) meeting said.

The Bank noted that the global economy was expanding at the fastest pace in seven years and that the UK was benefiting from that growth.

It also thinks that UK wage growth will start to pick-up, giving the economy a further boost.

As a result, the Bank has raised its growth forecast for the UK economy to 1.7% this year, from its previous forecast of 1.5% made in November.

But it says its forecasts are based on a “smooth” adjustment to Britain’s departure from the European Union.

Presentational grey line

Analysis: Kamal Ahmed, BBC economics editor

Today the Bank signalled that the old conventions of increasing interest rates when inflation is above target would return.

The cost of mortgages is likely to rise and savers at last will see returns improve.

The economy is stronger, the Bank has made clear today.

But not everything in the garden is rosy.

It points out that the UK economic engine still “remains restrained by Brexit-related uncertainty” which is “the most significant influence on the economic outlook”.

We are driving along with the hand brake half on.

Growth is modest by historic standards and the UK has gone from the fastest growing economy among the G7 largest global economies to the slowest.

Read Kamal’s blog in full

Presentational grey line

Perkier economy

Official figures last month showed that the economy grew 0.5% in the last three months of 2017, which was faster than economists had been expecting.

Unemployment remains low at 4.3% and inflation edged lower in December to 3%.

The Bank also released the letter sent by governor Mark Carney to the Chancellor of the Exchequer, Philip Hammond, to explain why inflation had breached the target rate of 3% in November.

In the letter, Mr Carney said that higher inflation was “almost entirely” due to the effects of a rise in the prices of imports, caused by the fall in the pound’s value after Britain voted to leave the European Union.

The chancellor replied by stressing the importance of boosting UK productivity and the government’s efforts to make that happen.

Theresa May told: Don’t let Philip Hammond ruin Brexit — “Treasury is ­trying to undermine both her and ­government policy.”

February 4, 2018

The Telegraph

Philip Hammond and Theresa May

Chancellor Philip Hammond has been accused of undermining Theresa May in Brexit negotiations

By Edward Malnick

Theresa May must invoke the ­example of Margaret Thatcher to defy Philip Hammond in order to seek a “clean Brexit” and end the current “uncertainty”, a senior Tory has warned.

Writing for The Telegraph ahead of two crunch meetings of Mrs May’s Brexit war cabinet this week, Bernard Jenkin cites Mrs Thatcher’s dispute with Sir Geoffrey Howe over Europe and declares that the former prime minister only “won the battle of the rebate” by overruling civil servants and ministers.

He accuses ministers of being “vague” and “divided”, saying that while Mrs May “sticks to one policy”, Mr Hammond “keeps advocating ­another”.

Amid claims of a “middle way” being drawn up for discussion among senior ministers this week, ­Jacob Rees-Mogg, who leads the 60-strong European Research Group of backbenchers, insisted to The ­Telegraph: “I think the Treasury is ­trying to undermine both her and ­government policy.”…

Read the rest (Paywall):


The Sun

THERESA May must summon up the iron will of the Iron Lady if she wants to achieve a “clean Brexit” and overcome the Chancellor Philip Hammond, a Tory MP has claimed.

Bernard Jenkin, the MP for Harwich and North Essex, has summoned up the spirit of Margaret Thatcher during her dispute with Sir Geoffrey Howe over Europe, saying the former prime minister only “won the battle of the rebate” by overruling civil servants and ministers.

. Prime Minster Theresa May has been told to summon up the spirit of Margaret Thatcher

Prime Minster Theresa May has been told to summon up the spirit of Margaret Thatcher

Mr Jenkin also accused ministers of being “vague” and “divided”, saying that while the Prime Minister “sticks to only policy”, the Chancellor Philip  Hammond “keeps advocating  another,” in an article for The Sunday Telegraph.

His words echo that of popular Tory Brexiteer Jacob Rees-Mogg’s claims last week that “either the Chancellor or his officials are deliberately trying to frustrate Brexit.”

Mr Rees-Mogg insisted to the paper: “I think the Treasury is trying to undermine both her and government policy.”


 Former prime minister Margaret Thatcher

Former prime minister Margaret Thatcher

 Tory MP Bernard Jenkin has issued advice to Theresa May over Brexit

Tory MP Bernard Jenkin has issued advice to Theresa May over Brexit

 Conservative MP Jacob Rees-Mogg is a staunch Brexit supporter

Conservative MP Jacob Rees-Mogg is a staunch Brexit supporter

The warning came as another senior Brexiteer claimed there were “far more of us” than Tory Remainers in the  Commons.

“We’re the ones who could pull the temple down,” the Brexiteer added.

The warnings will pile pressure on Mrs May ahead of two meetings of the Cabinet’s Brexit sub-committee on Wednesday and Thursday at which Mrs May hopes to sow the seeds of an agreement about the trade deal Britain will seek from the European Union (EU).

Mrs May faces a potential deadlock in the committee if she and her de facto deputy choose to side with Mr Hammond over senior ministers, including Boris Johnson, the Foreign Secretary and Michael Gove, the Environment Secretary, seeking a clean break from Brussels after the transition period.

Adding to the pressure, Gavin  Williamson, the Defence Secretary – who supported Remain in the EU  referendum – has let it be known  privately that he opposes any form of customs union with the EU.

“His view is the Government has to deliver a proper Brexit and not a  pretend Brexit, meaning that we have to have the ability to diverge and set our own rules,” said one MP who discussed the issue with Mr Williamson.

One compromise under consideration is for the UK to “mirror” the EU’s rules on imports from the rest of the world where an EU country is the final destination for those goods.

A  Whitehall source said: “The idea is to use these meetings to hammer out something that people can sign up to.”

Brexit: Treasury are ‘fiddling figures’ says Jacob Rees-Mogg — Accuses Treasury of rigging Brexit forecasts for a second time

February 3, 2018

Leading Tory Brexiteer Jacob Rees-Mogg has accused the Treasury of fiddling figures.
Leading Tory Brexiteer Jacob Rees-Mogg has accused the Treasury of fiddling figures. Credit: PA

Jacob Rees-Mogg has accused the Treasury of “fiddling the figures” in order to keep Britain in the EU customs union.

The leading Tory Brexiteer claimed economic models from Philip Hammond’s department which found the UK would be worse off if it remains outside the customs union post-Brexit were “clearly politically influenced”.

He also said that since the EU referendum was first called in 2016 – with the then-chancellor George Osborne campaigning for Remain – it was clear that the Treasury’s economic forecasting had become politicised.

“If you look at the forecasts the Treasury made before the referendum, they were a humiliation. They were clearly politically influenced,” he told the BBC Radio 4 Today programme.

“We need to be free to do deals with the rest of the world. We must be out of the protectionist common external tariff which mainly protects inefficient EU industries at the cost to British consumers.”

Chancellor Philip Hammond is pushing for a soft Brexit.
Chancellor Philip Hammond is pushing for a soft Brexit. Credit: PA

Mr Rees-Mogg said the Office of Budget Responsibility was initially set up by George Osborne “because the Treasury forecasts had been politicised” and were considered “unreliable on political grounds”.

“With the referendum and with the EU, the Treasury has gone back to making forecasts. It was politically advantageous for them in the past. It is the same for them now,” he added.

“So yes, I do think they are fiddling the figures.”

The row is the latest outbreak in hostilities in a growing split within the cabinet between Brexiteers and those such as Chancellor Mr Hammond who favour a softer exit.

Several attempts by leading Conservative figures to bring an end to the increasingly public rift have failed to end in-fighting over what shape the final exit deal should take.

Cabinet split: Theresa May has seen growing discord between pro and anti-Brexit ministers.
Cabinet split: Theresa May has seen growing discord between pro and anti-Brexit ministers. Credit: PA

Last week Mr Rees-Moggs strongly hinted that he would like to see Mr Hammond sacked in an appearance on Peston on Sunday.

A Treasury spokesman rejected the claims made against it.

He said: “Both Treasury ministers and officials are working hard to deliver the best Brexit deal for Britain.

“The Prime Minister and the Chancellor have said repeatedly that we will be leaving both the single market and the customs union.

“Any suggestion to the contrary is simply false.”

See also The Telegraph

Jacob Rees-Mogg has stepped up his attack on the Treasury, accusing officials of “fiddling the figures” in order to try to keep Britain in the EU customs union.

As senior ministers prepare to discuss Britain’s future relationship with the EU, Mr Rees-Mogg, the chairman of the influential pro-Brexit European Research Group of Tory MPs, said any deal which kept the UK in a common customs area with the EU would be unacceptable.

He claimed Treasury economic modelling suggesting Britain would be worse off in any arrangement outside the customs union was “clearly politically influenced”.

His intervention came after Theresa May, on the final day of her official visit to China, appeared to leave the door open to some sort of customs agreement with the EU – even though ministers have said Britain will leave the existing customs union.

However, Mr Rees-Mogg made clear any such arrangement would be…

Read the rest:

Brexit Bulletin: Open Warfare — The pressure is growing to tell Europe what the U.K. wants from Brexit — shows just how unreconcilable the differences are within the governing party

January 29, 2018

“At the moment there’s no clear destination, either in the government’s mind or indeed agreed with the European Union…” Cabinet infighting spilling out in to the open…


By Emma Ross-Thomas

  • Euroskeptics want Philip Hammond fired for his Brexit stance
  • Brexit legislation faces new battle in the House of Lords
 Image result for Theresa May, philip hammond, photos
TheCityUK CEO Says Need Brexit Transition as Soon as Possible

The pressure is growing to tell Europe what the U.K. wants from Brexit, and it’s revealing just how unreconcilable the differences are within the governing party. Prime Minister Theresa May’s job is on the line, as is that of her chancellor, Philip Hammond.

By March, May needs to tell the European Union how her government sees a future relationship with its largest trading partner. And this week or next talks will start on the transition, the period of two years after Brexit. That’s why the Conservative Party is now in open warfare; the window to influence what Brexit will mean is closing. Euroskeptics fear a sellout amid signs the “soft” Brexit camp led by Hammond is winning the arguments, and the government has made a series of gestures that suggest it’s trying to show hardliners it’s at least listening.

Pro-Brexit Tories led by potential leadership candidate Jacob Rees-Mogg have made plain that they want Hammond to be fired. It’s worth remembering what Rees-Mogg stands for: He wants a clean break with the EU and its rules and indicated last week that he’d rather walk away from the bloc than abide by the transition period that businesses are crying out for.

.@Jacob_Rees_Mogg responds to the current government position on transition: “At the moment there’s no clear destination, either in the government’s mind or indeed agreed with the European Union. One friend of mine said it’s more like a plank than a bridge.”

May, who will be in China for part of this week, is fighting to keep her job amid reports that lawmakers are frustrated by a lack of leadership. But the rebels are still too few in number to trigger a vote of no confidence, and she could well survive such a ballot. It’s not clear that the dynamics that have kept her in an impossible job since the botched election have changed significantly enough for her to be ousted.

Her woes will get worse this week with or without a leadership challenge. Her key Brexit legislation heads to the House of Lords, where peers are preparing to re-write it. Those changes seem likely to enrage the euroskeptics and make the gap between the warring factions deeper still.

Brexit Latest

French Poaching | French Foreign Minister Jean-Yves Le Drian told Japanese business leaders France would welcome companies that need to relocate from the U.K. because of Brexit. “First of all, the presence of the U.K. in the EU is finished,” he said in Tokyo. “Japanese companies must become aware of the consequences.”

Bankers Grim | Sentiment among London’s Brexit-hit bankers sank to its gloomiest depths since the 2008 financial crisis, a survey showed – a stark contrast to the bullish tone of finance executives gathered last week in Davos, Switzerland. Almost a third of firms think financial-market conditions will worsen in the next six months, according to the Confederation of British Industry poll.

Speech ‘Canceled’ | May has scrapped plans to give a third landmark Brexit speech because of the risk of cabinet infighting spilling out in to the open, The Times reported. However, May’s office said no such speech had ever been planned.

Swivel-Eyed Old Men | In a sign of the depth of division within the government, the Telegraph reports that energy minister Claire Perry described euroskeptic Tories as “mostly elderly retired men” who represent the “swivel-eyed few.” She made the comments in a WhatsApp message to colleagues in the aftermath of the December Brexit deal, which some euroskeptics criticized as a sellout. Perry said there are “no excuses” for her comments, but that they were aimed only at those who were calling her government colleagues “traitors.”

Secret Impact Papers | Cabinet members will be shown government impact assessments of the various Brexit options in one-to-one meetings with officials this week, The Times reports. At the end of the meetings, the papers will be collected to avoid leaks of the sensitive analyses.

Transition Threat | Officials fear a battle over accepting rules could delay a transition deal, the Financial Times reports. That comes after Brexit Secretary David Davis said on Friday the U.K. would have to find a way to avoid laws being brought in during the transition that would “run contrary to our interests and in which we have not had our say.”

Blackouts Coming? | Britain probably will risk more energy supply shortages after leaving the EU, a panel of lawmakers from the House of Lords said, as the exit will likely lead to a less efficient energy trade and higher prices.

And the Winners Are… | Lawyers and accountants are enjoying a Brexit boon, according to the Office of National Statistics. The business services sector, which includes lawyers and recruiters, as well as architects and travel agents, helped services expand 0.6 percent between October and December – the strongest performance in a year.

On the Markets | The pound’s winning streak means it could be vulnerable this week, Charlotte Ryan reports. Sterling has gained more than 5 percent this month, hitting a post-Brexit vote high above $1.43 last Thursday, and the test now is whether it can stay at these levels. Industrial data, political news and testimony from Bank of England Governor Mark Carney all have the potential to hurt confidence in the pound, according to strategists.

Coming Up | Davis will take questions from the House of Lords EU committee at 2:35 p.m. on Monday. EU chief negotiator Michel Barnier gives a news conference at 3:30 p.m. London time after the General Affairs Council, where the bloc will formally agree its approach to the transition.

And Finally…

What would Donald do? The U.S. president had some words of advice for May this weekend on how he would be negotiating Brexit.

“Would it be the way I’d negotiate? No,” he said in an interview with ITV, referring to May’s approach to the talks. “I would have said that the European Union is not cracked up to what it’s supposed to be, and I would have taken a tougher stand in getting out.”

May and Trump in Davos on Jan. 25.
Photographer: Simon Dawson/Bloomberg

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UK to launch new radar against ‘severe’ Russian threat

January 28, 2018


The new RAF radar facility at Saxa Vord under construction, on the Island of Unst, in the Shetland Islands off the northern coast of Scotland on Janu. 26, 2018. (AFP)
EDINBURGH: Britain’s Defense Minister Gavin Williamson said a new radar off Scotland’s Shetland Islands would help tackle the “severe and real” threat from Moscow.
In a return to the Cold War days when Shetland had hosted an early warning radar, the new Royal Air Force facility is being built to track unidentified military or civilian aircraft.
“We will always protect our skies from Russian aggression,” Williamson said Friday, describing the radar as vital to British defenses.
“Russia’s actions are not limited to Europe’s eastern borders — the threat to British livelihoods is severe and real,” he added.
The £10 million ($14.1 million) radar on Unst, Britain’s most northerly inhabited island, is due to be fully operational soon, the Ministry of Defense said.
Once launched it will feed into the country’s quick reaction alert system, which in the past has been used to scramble RAF jets to intercept Russian aircraft.
On Jan. 15 two fighter jets were launched to monitor two Russian military aircraft, which the Ministry of Defense said did not respond to air traffic control authorities.
Image result for Russian military aircraft, uk, january 2018
UK Fighter Jets Intercept Russian Bombers Approaching UK Airspace. Published: January 15th, 2018
A total of 69 such operations have been carried out in the past five years, the ministry said without detailing how many involved Russian aircraft.
Williamson’s praise for the radar comes as he and defense chiefs up their rhetoric against Russia.
On Thursday the defense minister accused Moscow of spying on Britain’s crucial infrastructure, as part of possible plans to create “total chaos” in the country, in comments published in the Daily Telegraph newspaper.
His intervention came after the head of the British army warned Russia poses the “most complex and capable” security challenge since the Cold War.
Chief of the General Staff Nick Carter warned Monday that Britain struggled to match Russia’s military capabilities, saying the ability to respond to threats would be eroded “if we don’t match up to them now.”
The comments come as Williamson, in the post since November, is reportedly pressuring Finance Minister Philip Hammond for more money.