David Davis, the Brexit secretary, has admitted that the EU has “pushed back” on the two proposals from the government purportedly showing how the UK could leave the customs union but still maintain near-frictionless trade with the EU after Brexit.
Two weeks ago, after the Daily Telegraph reported that both proposals had been rejected by the EU, Downing Street played this down, saying it did not recognise the claims. Today Davis effectively admitted that the reports were accurate. (See 5.27pm.)
Giving evidence to the Lords EU committee, he also reaffirmed his view that it was important to get a “pretty substantive” deal on a future trade relationship finalised alongside with the withdrawal agreement in the autumn. He said:
We take the view that it has got to be pretty substantive. Parliament will vote more than once on the withdrawal agreement and I would be surprised if parliamentarians are happy to vote for the expenditure of £35 to 39bn without knowing what we are getting for it. I think it would be quite difficult to get the withdrawal agreement through the House if we don’t have it substantively done.
That’s all from me for today.
Thanks for the comments. And I’m sorry we had to turn them off.
Q: When parliament votes on the withdrawal agreement, there will not be a legal text on the future trade relationship. Isn’t there a danger that people will put different interpretations on it?
Davis says in a negotiation people just put forward negotiating positions.
Parliament will have a long time to consider this before it gets put to a vote.
He says Angela Merkel, the German chancellor, has stressed that she wants the political declaration on a future trade deal to include details.
He says parliament will have a very good idea of where things are heading.
Q: Does the European parliament proposal for the UK having an association agreement with the EU have any merit?
Davis says he has no objection to the concept. But he would not want to see the UK being bound by the ECJ. He says Guy Verhofstadt, the European parliament’s Brexit spokesman, who is pushing the idea, is thoughtful and worth listening to.
The Labour peer Lord Whitty goes next.
Q: Our judgment is that the UK and the EU are still quite far apart. What is your assessment?
Davis says the EU has repeatedly complained about what the UK is offering. That is just part of the process, he says.
He says the UK and the EU need to agree to negotiate the trade relationship in parallel.
If they try to negotiate 45 issue in sequence, he will be dead and buried before the finish.
He says the fact that UK and the EU are starting from the same place makes a big difference.
He wants to reassure the EU that the UK will not diverge in such a way as to undercut them. They are worried about this, and about the UK being a regulatory “Wild West”. So there is a need for an agreement on dispute mechanism. But once that is sorted, then it will be much easier to agree other issues.
He says the government has a plan for services. It will put this in the public domain shortly.
Q: When joint report in December said option C for the Irish border would involve maintaining full regulatory alignment, was that for the whole of the UK?
No, says Davis. He says that just referred to north- south relations.
In the Lords committee the former Labour MP Hilary Armstrong says government has advertised jobs in the Border Agency in Northern Ireland saying people need a British passport. That’s worrying, she says. In Northern Ireland you can have an Irish passport.
She says when the committee visited Northern Ireland, they did not find anyone who thought the border issue could be solved without having a customs union.
Q: Would not having a hard border mean no physical infrastructure?
At the border, says Davis.
He says, whatever infrastructure there would be, it would not be wise to put it up at the actual border.
He says the existing border is done by intelligence-led policing and customs arrangements. That could include automatic number plate recognition cameras, but back in Belfast.
Davis says he cannot imagine the circumstance in which the Irish government would put up a hard border.
But he says it is for both sides to take responsibility for finding a solution to the problem.
Davis is summing up the government’s two proposed customs models.
The commission “pushed back on both”, he says.
They were concerned about how the “customs partnership” (the one involving the UK collecting tariffs on behalf of the EU) would be run.
And, with the highly-streamlined customs arrangement, they were concerned about the impact of exempting smaller traders.
- Davis admits EU has “pushed back” on both UK proposals for future customs arrangements.
Q: You visited the Irish border recently. What were your impressions?
Davis says there are concerns there.
He saw a sign saying that a road would be closed in the event of a hard Brexit. He thought that was wrong.
But he has briefings from the police. What they said about the potential problems was “very forthright”.
Davis says it is important to remember that the Ireland border is not a non-border. There is a border on customs and on tax, he says.
If there is a free trade agreement, there will be no tariffs.
So the border issue will be a regulatory issue, he says. But he says no one is arguing for the UK to stay in the single market.
lisa o’carroll
(@lisaocarroll)David Davis concedes that the real issue in Ireland is the single market regulation not customs.
May 1, 2018
Davis says, if the UK had tried to extend the transition beyond December 2020, the UK would have had to contribute to a new MFF (multi-annual financial framework – a longterm EU budget.) The bill might have been quite high, he says.
Davis says the government wants the defence and security partnership in place as soon as possible, and potentially before the end of the transition.
