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Thursday 12 July 2018

“I’m clear that the best outcome – for both the UK and the EU – is a deal based on the ideas we are setting out on Thursday,” writes Theresa May in an op-ed for the Sun in advance of today’s release of her White Paper, the technical negotiating terms for a future “economic partnership” with the European Union based on the conclusions to Friday’s infamous meeting at Chequers.

Leave.EU will be scouring the document as soon as it is published. In the meantime, you can read our deconstruction of the three-page statement here.

Needless to say, it will go down like cold sick. A Times/YouGov poll reveals a full 58% of voters don’t approve of the May’s plans, only 23% support them.

But amidst all the misery, the FT reports UK financial services, which account for more than 12% of the economy will not be hemmed into a “mutual recognition” arrangement with the EU.

A feud between the Treasury and the Bank of England was set to brew as surprisingly the latter has been pushing for emancipation from EU rules so that UK financial services can become more competitive through ambitious re-regulation. Chancellor Philip Hammond had wanted to stay tight with Brussels, proposing a system whereby the EU recognizes the UK’s standards as equivalent and vice versa.

The unlikely saviour is Brussels. Michel Barnier refuses to build a new framework from scratch. The white paper will indicate a more autonomous direction for UK finance.

“Mutual recognition was like a marriage,” said a source who has seen the section on financial services. “The new model is like cohabitation, with close collaboration, a shared approach to finances and decisions and obligations to each other, but ultimately separate people making their own choices.”

This sounds more than mildly contradictory, but the source added that “the UK and the EU will not have current levels of access to each other’s markets,” added the source. This we can believe, it is well-known the EU, increasingly influenced by President Macron’s administration, is looking to steal business from over the Channel.

Meanwhile, the quest of Brexiteers in Westminster to get the Chequers plan killed before Parliamentary recess on 20 July has stepped up yet another notch. The Guardian report members of the European Research Group are looking for the government to publish the alternative white paper authored by David Davis’s team when he was Brexit Secretary.

Davis had advocated a conventional trade agreement with controlled borders. His proposal was snubbed by the PM and locked away in a safe in Whitehall. Now ERG members are looking to use a humble address (a Commons motion carrying the weight of the Crown) to force Downing Street to get the document out of the safe and into the open.

It is vital for Davis’s vision to get into the public domain to expose yet further the folly of the current plans. His successor Dominic Raab spoke on the Today programme this morning. Shockingly, he refused to lay down any red lines in advance of trade talks. The plan he has been recruited to push before his opposite numbers at the European Commission is already littered with concessions. We can expect some very grave climbdowns over trade, the judiciary and most worryingly of all, free movement.

Finally, Maria Caulfield, who resigned as Conservative vice-chairman on Tuesday has written a must-read op-ed for the Telegraph

“This ‘deal’ is worse than ‘no deal’ and ironically far worse than a deal – a Canada-type free trade agreement – that European Council President Donald Tusk himself offered, saying: “I propose that we aim for a trade agreement covering all sectors and with zero tariffs on goods. Like other free trade agreements, it should address services,” she writes, adding:

“Instead of exploring this perfectly acceptable solution, a small cabal in Downing Street has dreamt up a complex arrangement that seeks to recreate large parts of the EU’s single market. This comes with serious costs. Accepting a ‘Common Rule Book’ sounds innocuous but means accepting EU rules over the regulation of our domestic economy with no say.”

We had to acknowledge England’s heroic performance at this World Cup and last night’s tragic defeat. Too bad the EU couldn’t show the magnanimity displayed by others.