1. I understand that No10 are adamant that they won& #39;t drop the controversial clauses 42-45 from the UKIM Bill. In their view, these clauses are about protecting "essential UK interests" against EU over-reach. Braverman& #39;s gutsy speech in the Commons yday spelled out this view.
2. There& #39;s a big trouble ahead with the EU, but legal countermeasures aren& #39;t seen as a political risk. The view is that if the EU infracts Govt under NIP and takes it to the ECJ, this will be a fight btw "a sovereign Parliament v European judges". Speaks to the core constituency.
3. There& #39;s more to come. Finance Bill will introduce measures protecting GB-NI trade. I expect this will set more hares running in Bxl and EU capitals, because the perceived risk to "the integrity of the single market" via GB-NI trade is greater than in the opposite direction.
4. And there& #39;re also ongoing concerns inside No10 about UK courts continuing to interpret UK law in line with future ECJ case-law due to "muscle memory" of judges; so we shouldn& #39;t be surprised if there& #39;s another surprise coming, this time perhaps from MoJ or the AG& #39;s office.
5. On the deal with the EU, the view is that the UK needs to be seen to want a deal, but a deal is possible only if a) the EU drops its state aid ask and b) legal text can be done in the next few wks. There& #39;s a push for negotiating tunnel to demonstrate determination for a deal.
6. My understanding is technical talks are there just to fill the void. Little space to maneuver in key areas; a deal seen as feasible only if politicians instruct teams to move. James& #39;s piece is right that the landing zone for fisheries is clear; always going to be the case. But
7. The big, really big question is state aid. A common mistake is to assume that No10& #39;s opposition is merely to alignment on EU state aid legislation and frameworks; it is a much deeper hostility to any constraints that would bind a sovereign UK in the future.
8. NI Protocol has served as a warning to No10 ; Johnson signed up to it last autumn under pressure to get the WA over the line and to save his political future, but Art 10 of the Protocol seen as a big mistake. One of the genuine drivers behind UKIMB was to rectify this.
9. No10& #39;s latest line on state aid is that they need to consult business before decisions abt future regime. It& #39;s used to support their argument in the neg room that & #39;we can& #39;t pre-empt outcome with binding constraints in EU FTA& #39;. Sharma met w/ business this week to talk abt this.
10. Also understand the PM isn& #39;t very engaged with the negotiations; all decisions are in the hands of the spad trio of Frost/Lewis/Cummings. They& #39;re all in agreement on the fundamentals for a deal: (1) nothing that binds the UK in the future; (2) the agmt must be done this year.
11. Both premises are very challenging. On (1): it& #39;s clear the EU will be reluctant to sign a FTA without binding state aid rules. There& #39;s some Whitehall chit-chat about dialing up the offer to WTO-plus commitment + arbitration + unilateral tariffs if subsidies deemed harmful.
12. But there& #39;s a growing recognition that technical talks can& #39;t get us there; Barnier doesn& #39;t have the mandate to agree to anything less than the UK signing up to a domestic state aid regime + independent enforcement. Neither No10 nor BEIS are ready to commit to this right now.
13. It& #39;s difficult to see movement on state aid without political intervention btw Johnson/Macron/Merkel. Understand FR has been anxious abt anything less than alignment on EU state aid rules; DE more pragmatic but clear about protections against the UK "free-riding" on EU rules.
14. And, since the EU has made clear that FTA will be conditional on Govt dropping the difficult parts of the UKIM Bill, I expect that their view will only solidify when the Finance Bill lands in a few weeks& #39; time. Difficult to swallow for the EU, & difficult to abandon for No10.
15. On (2): practical feasibility of a deal seen as a real challenge. There& #39;s been varied progress across 10 negs streams. In some areas, legal text can be finalised in a week/two. In others, there& #39;re too many outstanding technical issues to get through without joint legal text.
16. All this paints a less optimistic picture than James& #39;s piece. He& #39;s right that there& #39;re are drivers for a deal inside HMG. But they don& #39;t come from No10, but other parts of govt, esp CO/HMT. Gove worried abt no-deal impacts on the Union; Sunak abt the border and the economy.
17. The PM might be keen to salvage a deal. But I expect that, if there& #39;s going to be a deal, it& #39;ll be as a result of a fight inside HMG: between the trio Frost/Lewis/Cummings (against deep concessions with every fibre of their being) and moderate Cabinet members and parly party.
18. Until then, both sides will say, & #39;we really want a deal& #39;. Both need to be seen as constructive if the talks were to fail. But we shouldn& #39;t be under any illusion that there& #39;ll be concessions on the fundamentals anytime soon. The deal is not without touching distance. (END)
Just going to add this: there’re always briefings to the press before crucial Cabinet meetings. XS Cttee meets on Monday to decide on the next steps for negs; it’s to be expected that ministers/spads will brief out their lines to their favourite journalists.
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