Brexit Bill: Pound Spikes but Politics in Tatters
The EU and the UK did not confirm the amount of the Brexit bill they will be comfortable with, but it was widely reported today that UK ministers are willing to accept a figure around £50bn.
Today, the issue of the UK’s outstanding financial commitments and the government’s willingness to make a considerable offering was also raised in the Commons by the chief secretary to the Treasury Liz Truss. Truss reminded MPs that any offer the UK makes to the EU should be connected to a good trade deal, and she said: “What we have seen today is simply media speculation and we will update the House when there is more detail to give ... As we have said, nothing is agreed until everything is agreed. Any settlement that we make is contingent on us securing a suitable outcome.” This, however, contradicts the EU’s previous comments where they have stressed that the Brexit bill is completely separate from the possibility of a future trade agreement between the two sides.
As the EU’s chief Brexit negotiator, Michel Barnier, said earlier in September, “I see no logical and coherent link between a discussion we will have as soon as possible about the future … and a discussion about the separation issues and commitments entered into in the past.”
The Labour party has tabled an amendment to the EU withdrawal bill which calls for a parliamentary vote on the Brexit bill. Liz Truss argued that the government would undermine its position if it gave away too much information about the financial settlement: “Our officials have been working on it for months. It would be completely wrong of me to cut across those discussions by commenting on speculation about the financial settlement, and it would not be in our national interest.”
While Labour’s shadow chief secretary agreed with her and said that the government shouldn't have to give a precise figure of the bill at such a sensitive time, he did stress, however, that the Brexit bill should be assessed by two independent watchdogs, the Office for Budget Responsibility and the National Audit Office, before MPs get to vote on it. Labour’s amendment is expected to be voted on this coming Wednesday.
Brexiters changing their minds
Many Brexiters avoided to criticise the government for agreeing to pay the divorce bill, despite previously fighting and arguing that the UK doesn’t owe anything to the EU. Most of the Brexiters would only agree to a £50bn figure if the government is guaranteed a free trade deal. Others argued that the government should spend such a big sum of money on public services instead. Last week, Tory MP Andrew Bridgen suggested that he would vote against a $40bn Brexit bill and told BBC News that the government’s decision was “premature.” He also very wisely pointed out that any Brexit bill should be approved by the Commons. For him, paying such a large amount of money without any guarantees was “not a great deal”: At the end of the day, to vote for a deal, and not go to WTO, which is a deal we could have for free, I’ve got to be able to look my constituents in North West Leicestershire, who voted overwhelmingly to leave, 61% to 39%, in the eye and say that I believe this is a good way to spend taxpayers’ money .... Let’s see what we are going to get in return. We currently don’t know what we are going to get in return, what sort of trade deal they might offer us. And it’s bizarre that we’re going to pay potentially £40bn, or offer to pay £40bn, to allow the EU to have a €90bn trade surplus with us. That’s not a great deal. But let’s see where we get to.” (my italics)
Labour’s Chris Leslie criticised the government's willingness to pay for something worse than the UK is currently enjoying. He said in the Commons: “What wondrous new advantages will we gain by shelling out these astronomical sums? Won’t the chief secretary be straight with the House that we are paying for the privilege of putting the world’s most efficient free trade, tariff-free, frictionless agreement into the bin, and we’re being told to pay for the privilege of downgrading to an inferior deal with our European neighbours? Why does [Truss] think that the only people who can’t be told are the British public and the British parliament? This is not what the British public voted for in the referendum. It is not taking back control. It is losing control.”
And he couldn’t be righter. This is definitely losing control and throwing away more privileges for nothing. While Truss said today the government was willing to get the best deal for the taxpayer, it begs the question, how many rights and privileges would be lost in the process. For the time being, at least today, was a good day for the pound. For the rest of us, the Brexit saga continues.