Maitland Political Monitor – 12 January 2018
Last night’s summit between City finance chiefs and the Prime Minister in No. 10 concluded on a high note, with May reportedly having promised to put financial services front and centre of a future trade deal. “They are rolling up their sleeves and getting down to the nitty gritty, which is good,” one participant told the Financial Times. “It was very practical, asking us what are the steps they need to take.” Unfortunately, Theresa May’s spokesman also last night categorically ruled out paying the EU for single market access for financial services.
Sadiq Khan has commissioned his own study into what a no-deal Brexit would cost the UK economy, and found that under all scenarios London and the rest of the UK would keep growing, but more slowly than if the country had stayed in the EU. The mayor announced that the study showed that a no-deal Brexit could cost 500,000 jobs and £50bn in lost investment compared to staying in. If a deal were struck that would allow Britain to retain privileged access to the single market, annual growth would be less than 0.1% lower than it would have been by remaining a member.
In other Brexit news, Nigel Farage is back in the papers, having announced that he wants a second EU referendum. However, a recent ComRes poll found that only 43% of people are in favour of a vote, while 51% are opposed. However, if the vote were to somehow go through, it’s also been found that 51% would now back Remain, while only 43% would back Leave. He made a U-turn in The Telegraph last night, but Remain-backers still see the move as hope that a second referendum could be backed on the final Brexit deal.
In other news, Downing Street will breathe a sigh of relief today as President Trump has confirmed that he won’t be visiting London next month to open the new US embassy. The decision is thought to be influenced by the prospect of mass protests, but Trump tweeted “Reason I canceled my trip to London is that I am not a big fan of the Obama Administration having sold perhaps the best located and finest embassy in London for ‘peanuts,’ only to build a new one in an off location for 1.2 billion dollars. Bad deal. Wanted me to cut ribbon — NO!”
- Theresa May has told City bosses that she will put financial services at the heart of a new trade deal with the EU, in her first formal meeting with the financial services sector on Brexit.
- A no-deal Brexit would result in only marginally lower UK growth and employment, an analysis commissioned by Sadiq Khan has concluded.
- Nigel Farage’s unexpected call for a second EU referendum has ignited hopes among anti-Brexit campaigners that both sides of the debate will back a poll on the UK’s final deal.
Farage wants a second referendum. Bring it on—The Guardian, Andrew Adonis
Labour peer and former cabinet minister Andrew Adonis strongly supports the call for a second referendum by Nigel Farage. He says that while Farage’s initial rationale for a second referendum is only to vindicate himself and his hard Brexit backers, his underlying argument is “essentially correct– Brexit is not a done deal, the future is still up for grabs and the debate about Britain’s place in the world continues.” Lord Adonis claims that advocates of Britain’s European future should 1) welcome the concession from Nigel Farage that a single vote doesn’t mark the beginning and end of the debate on EU membership, and 2) “Prepare ourselves for the fight of our lives”. He believes that a second vote could be won in favour of remaining in the EU, but that it would not be inevitable. “Instead we have to go out into the country and answer the crucial question for many who voted to Brexit out of legitimate anger and despair: If not leave, what?” Lord Adonis makes no qualms that another vote would need to be deserved, which can only happen if voters are showed that their concerns have been heard and learned.
Brexit exposes our reliance on the City—The Times, Philip Collins
Philip Collins explores intriguing aspects about the country he thinks were revealed through Sadiq Khan’s recent Brexit assessments. Whether the predictions are accurate or not, Collins’ argues, Britain is ‘damagingly dependent’ on London. Any effect on the capital will cause a significant effect on the nation. Furthermore, revenues that flow into London – and filter out into the nation – are too closely tied to the health of the financial services sector. Collins shows that London is one of only two regions in Britain that generates a surplus. London accounts for a quarter of all the income tax, corporation tax and business rates paid in the country: ‘If London were to declare its independence and join the EU, it would do so as the ninth largest nation on the Continent. Within London, the industry most worried about Britain’s departure from the European Union is its most successful. Financial services provide 12 per cent of British tax revenues and employ 1.1 million people.’ He concludes that a Corbyn government would be just as reliant on the City as any other administration. If Corbyn were to pursue generous public spending he would have to ‘keep the rich on their side…The gradual adoption, by Mr McDonnell and Mr Corbyn, of positions they once denigrated as Blairite is a fascinating volte-face. But this over-reliance on the capital’s financial ingenuity is not primarily a problem for John McDonnell. It is primarily a problem for Britain.’ Collins explores the liberalisation of the City in 1986 that caused it to thrive before concluding, ‘Any government, of any complexion, is going to have to become serious like none before about applying the same radicalism and deregulation to the provinces. That is the unintended but most significant message from Mr Khan’s impact assessments that will survive the spat over numbers.‘
- Liam Fox, international trade secretary, visits Turkey for meetings with officials.
- Karen Bradley, Northern Ireland secretary, meets with Simon Coveney, Irish tanaiste, for talks on restoring the Stormont executive.
- Labour Party is expected to announce the outcome of an investigation into claims of alleged inappropriate behaviour by Kelvin Hopkins, MP for Luton North
- The public accounts committee releases report on HMRC performance 2016-2017.
- Noon: Polls close in elections to Labour’s national executive committee.
House of Commons and House of Lords
- No business scheduled
Nick Clegg @nick_clegg
I agree with Nigel.