Theresa May must use her skill and negotiate trade deals early for a clean Brexit
The Prime Minister wants to get on the front foot early
THERESA MAY wants to get on the front foot over Brexit.
So she is not waiting for the Supreme Court to deliver its verdict in the Article 50 case to give her big Brexit speech. Instead, she will do it on Tuesday.
The view in No10 is that if uncertainty is the problem, then the best answer is to get on with it.
Cabinet Ministers have yet to see what she will say. I’m told they will get a briefing on the speech at Cabinet on Tuesday.
But given that Mrs May is speaking that day, this discussion is unlikely to lead to major changes.
I understand the speech’s tone will be designed to try to reassure those who voted Remain — but that the substance will point towards a clean Brexit.
It has long been clear that Mrs May’s desire to take back control of immigration policy meant Britain would, barring an unlikely EU climbdown, quit the single market. Whether Britain would leave the customs union as well has been less clear.
But I understand from those intimately involved in the preparations for the negotiations that the most likely option now is that Britain will quit the customs union.
However, the Government will try to negotiate a customs arrangement with the EU to ensure trade can continue as smoothly as possible.
The reason to leave the customs union is so Britain can make trade agreements around the world.
Even Cabinet Ministers who supported Remain admit they have been surprised by how many countries are keen to do deals with us. Under Donald Trump, the US is one.
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Indeed, I understand that the Trump team have already started working on the outlines of a US/UK deal.
They would like to get one pencilled in before the UK leaves the EU, though no agreement could be signed until Britain has formally left.
A comprehensive trade agreement between the UK and the EU is in both sides’ interests. But there are concerns in Government that emotion could get in the way.
There is particular worry about how the European Commission will behave during negotiations.
“The Commission doesn’t have logical interests, as we do, as other countries do. They’re not as rational,” warns one member of the Cabinet’s Brexit committee.
There was delight in Government when Bank of England chief Mark Carney warned Britain leaving without a deal on financial services would be more dangerous for the EU than the UK because of European business’s reliance on the City of London for funding.
They wanted this point on the table to concentrate EU leaders’ minds ahead of the negotiation.
But they were worried that making it themselves would seem too aggressive.
The Governor of the Bank of England putting it out there is perfect for them.
Mrs May will go into these negotiations with a stronger negotiating hand than she would have expected when she became Prime Minister.
The resilience of the UK economy and Trump’s victory have seen to that.
She must now play that hand with skill and confidence.
Why manifesto pledges could trip up Prime Minister
IT seems like an age ago now. But less than two years ago, the Tories – under Cameron and Osborne – won a General Election.
But what is the status of the manifesto that won them that majority now Cameron has gone and Britain has voted for Brexit?
At Cabinet this week, Ben Gummer - the bright 38-year-old who Mrs May has put in charge of the Cabinet Office – updated ministers on how the Government was doing in implementing it.
Philip Hammond, the Chancellor, quickly pointed out that much has happened since the manifesto was written.
He noted that the commitment to run a surplus by 2018 had already been dropped.
Several Cabinet Ministers I’ve spoken to think that Brexit means that the manifesto cannot be regarded as much more than advisory.
But others feel strongly that the Tories were elected on it and must stick to it as much as possible.
Mrs May will have to tread carefully here.
With Brexit to be negotiated, she has no desire for an early election.
But until she wins a majority on her own manifesto, she won’t have her own mandate for radical change in domestic policy.
Trump goody bags signal who carries his favour
THERE’S a new way to tell who is in with the Trump team: Do they have a Trump goody bag?
Favoured visitors to Trump Tower are given a black bag with Trump written on it in gold letters. Inside the bag there’s one of Trump’s iconic Make America Great Again baseball caps.
There’s also a bar of chocolate in, unsurprisingly for Trump, a gold wrapper. There are Trump bumper stickers too.
Boris Johnson and the British delegation who went to see Jared Kushner, Trump’s son-in-law and close adviser, and Steve Bannon, the new White House’s chief strategist, got goody bags.
But there haven’t yet been any sightings of Boris in a Make America Great Again hat.
A secure move for No10 team
THE National Security Adviser to the Prime Minister will be the next senior civil servant to leave their post.
Mark Lyall Grant will retire from the civil service later this year.
The strong favourite to replace the 60-year-old is Mark Sedwill, the Permanent Secretary at the Home Office.
Theresa May worked with Sedwill for several years when she was Home Secretary.
His move to No10 would provide her with foreign policy advice from an official she has developed a strong working relationship with.
“She likes people we know and trust,” says one senior figure involved in discussions about the move.
An added bonus of appointing Sedwill is that he knows Donald Trump’s national security adviser, General Mike Flynn, from their time in Afghanistan.
This relationship will be helpful as the May team try to develop ties with the incoming US administration.
Sedwill is well qualified for the job. He has been the political director of the Foreign Office as well as the PM’s special representative for Afghanistan and Pakistan.
But the departure of Lyall Grant will fuel the chatter in Whitehall about the relationship between the May team and officials.
Tensions between No10 and the NHS chief executive Simon Stevens have escalated after he accused them of “stretching it” in their claims about health funding.
“Simon Stevens stands up to take any credit and ducks whenever there is trouble,” complains one Government source.
But some ministers are worried about these clashes.
One warns: “They have to be a bit careful about how they handle these figures. They are people who can walk.”
Stevens is certainly a more formidable foe than Sir Ivan Rogers, the UK ambassador to the EU who resigned in protest at May’s Brexit strategy.
For Stevens, unlike Rogers, is arguing for something that most voters want: More money for the NHS.
No10 still confident in industrial strategy timeline
No10 is still confident that the Government’s industrial strategy paper will be released the week after next.
However, I understand it has yet to go out for Cabinet approval.
I hear the Treasury is concerned about the cost implications of some of the new policies on skills and training.
But with No10 keen not to have Brexit dominate everything, they will be eager to get this document out on time.