The UK is looking for Brexit benefits as promised ‘Freedoms’

(Bloomberg) — Rishi Sunak faces yet another sensitive decision after senior civil servants asked him to delay a planned legislative “bonfire” related to the United Kingdom’s membership of the European Union.

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The request by officials to move the current 2023 deadline to remove around 4,000 EU laws from Britain’s statute books by three years is a headache for the prime minister, who said in the summer that the legislation could be repealed or review within 100 days.

If the chief executive gives in to the demands of his officers — who say the task can only be done in such short order — he risks alienating leading Conservative Brexiteers such as Jacob Rees-Mogg, which is shredding the legislation. a claim that has achieved totemic status.

For the prime minister, a Brexiteer who has an uneasy relationship with his party’s right-wing vote, there is a risk that more weight will be thrown behind the argument that most Tories do not want to concede: it seems difficult get the identifiable benefits of Brexit.

Data this week shows immigration reaching a record in the first year of the post-Brexit British regime, despite the referendum promises that the EU divorce would allow Britain to control its borders again and reduce numbers. The US trade deal that former Prime Minister Boris Johnson called Brexit’s big prize is nowhere to be seen, and last week Sunak didn’t even bother to bring it up in a meeting with President Joe Biden at the summit G-20 i. Indonesia.

More Like Switzerland?

And Britain is at odds with the EU regarding the implementation of the agreement negotiated by Johnson because of the additional burdens it places on trade between Northern Ireland and the rest of the UK.

With Brexit leading to increased red tape for businesses trading with the bloc, the Sunday Times reported that the government was seeking closer trade links with the EU similar to the bloc’s relationship with Switzerland.

Sunak and Chancellor of the Exchequer Jeremy Hunt had to deny that, despite multiple senior government officials confirming to Bloomberg that Hunt had spoken so privately.

There is little prospect of the UK government renegotiating Johnson’s Brexit deal before the next election due in two years, as it remains such a politically toxic issue. Re-joining the EU is unlikely for the foreseeable future, and even a relationship like Switzerland crosses multiple red lines for the Brexiteers, including contributions to the EU budget, the need for some of its rules continue, and accept the free movement of labour. .

Migration Boom

The evidence of the last few days casts doubt on whether the Sunak government really believes it can achieve some of the supposed “freedoms” that Brexiteers have said could be achieved by leaving the EU.

Migration is a special case. While Home Secretary Suella Braverman is cracking down on people crossing the English Channel in small boats, the country’s new border controls allowed net migration to reach 504,000 in the year to June, the highest figure ever recorded, according to data of the Office for National Statistics on Thursday. .

Sunak’s spokesman, Max Blain, insisted that the prime minister is “absolutely committed to reducing the overall number,” although with current labor shortages in mind, it is unclear how and when the government intends to that would happen.

Control of migration was one of the main factors behind the Brexit vote, but Blain said the UK still “doesn’t really have control” of its borders and that illegal migration across the English Channel continues, comments that suggest it has not been met. the promise of the Leave campaign. years after the referendum.

Sunak’s government has also challenged the Brexiteer vision of a low-tax UK and deregulated City of London.

Financial Services

On Wednesday, the Treasury scrapped a plan to give politicians the power to intervene over financial regulators. The plan for so-called “call-in” powers to legislate on the UK’s post-Brexit framework for banks, insurers and asset managers has sparked controversy.

Proponents argued that it would give British lawmakers extra democratic oversight of regulators now that the UK has left the EU. But critics including the bosses of prudential and consumer regulators said it threatened to undermine its independence and damage the UK’s reputation.

Hunt also said he had asked the Treasury to look at how much money the government could raise by taxing wealthy foreigners with so-called non-domain status.

Meanwhile, the EU continued to back away from the predominance of British financial markets and a requirement that derivatives traders use accounts at clearing houses in the bloc for some transactions. The proposed reform — first reported by the Financial Times — is aimed at reducing the EU’s reliance on the UK’s financial services sector after Brexit. The claims would relate to derivatives, and could include credit swaps and futures.

When asked to name the benefits of Brexit this week, government spokespeople responded by arguing that the UK could innovate in areas such as gene editing and life sciences.

Speaking in the House of Commons on Thursday, veteran Brexiteer and Conservative backbencher Peter Bone insisted he was glad the free movement of people had ended and the UK had sovereignty over its own laws. He asked for a debate in Parliament under the title: “Brexit: a roaring success. No turning back.”

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