Summary of May's statement and Hammond's committee hearing on Brexit
- Theresa May has suggested that the UK is looking at the US/Canada border for lessons that could help to provide a solution to the Irish border problem. (See 5.20pm.) As Bloomberg’s Robert Hutton points out, Ireland has already rejected this option.
This afternoon Theresa May told @EmmaReynoldsMP that the US-Canada border could be a model for Ireland. As Ireland's Taoiseach pointed out months ago, that means flags, guns and checkpoints: https://t.co/tFsYHQaH6r via @bpolitics
— Robert Hutton (@RobDotHutton) March 5, 2018
- Hammond, the chancellor, told MPs that the UK and the EU needed to agree a transition deal by April because otherwise airlines would not be able to schedule flights with certainty for April next year. He told the European scrutiny committee:
The implementation period is in our view very much in the interest of both sides - to create some certainty to allow businesses to plan - to deal with immediate pressing issues. For example - airlines will need to know on April 1 whether they can safely schedule flights in April, 2019. There are lots of practical issues that are going to become very problematic across the continent of Europe unless we agree this implementation deal.
- He said that, once a transition deal is agreed, the government would stop spending money preparing for a “no deal” Brexit in March 2019. He said:
As and when it becomes clear that we can discount as reasonably unlikely any of the options - for example, once we reach an implementation period deal - I would expect that we would then be able to stand down planning for a no deal exit in 2019.
- He said it was possible that the UK and the EU could agree a transition but then fail to reach a deal on a long-term partnership. The government was making contingency plans for this, he said. (This would mean the transition ending in 2020 or early 2021, with the UK then having to trade with the EU on WTO terms.) Hammond said:
In terms of the contingency planning that is being done, it is to cover all possible eventualities. One possible, although perhaps rather unlikely, eventuality is that we reach agreement on an implementation period but then fail to reach agreement on a long-term partnership agreement. I hope that won’t be the case, but it would be right that we covered that as one of the potential outcomes.
Asked if this meant the transition could be extended, Hammond said the government had “no plans” for this. He said:
We have no plans to make provision for extension, and I expect that, because of what the European Union has said, the structure of the implementation period will have a fixed end-date in the agreement that we reach with the European Union.
- He said the government had so far spent about £700m preparing for brexit. That was from the £3bn set aside for spending on Brexit planning in 2018/19 and 2019/20, he said.
The £3n was for 2018/19 and 2019/20 and I expect to announce shortly the allocation of funding for the 2018/19 share of that amount.
It’s being spent on ensuring that we are prepared for a full range of outcomes. Some of it is being spent on preparations for a ‘no deal’ exit in March 2019.
- May told MPs that her approach to President Trump was more likely to get a good deal for the UK than Jeremy Corbyn’s. When questioned if a good trade deal could be reached with the Trump administration after in the light of its decision to impose big tariffs on steel and aluminium imports, she said:
I spoke to President Trump about this yesterday. Can I just say to you that we’re much more likely to get a positive response by engaging with the United States of America rather than by standing on the sidelines sniping and shouting at them, as you always do.
- May said the NHS would be “not for sale” in future trade talks with the US. In response to a question from Sir Vince Cable, the Lib Dem leader, she replied:
I’m absolutely clear that as we look to negotiate a trade deal with the United States of America the National Health Service will remain as it is today, it will remain free at the point of the use - the National Health Service is not for sale.
We continue to stand by the principles of the NHS and we’re very clear about that when we come to negotiating a trade deal with the United States.
That’s all from me for today.
Thanks for the comments.
Updated
Earlier, in Brussels, a Sinn Fein team were meeting Michel Barnier, the EU’s chief Brexit negotiator.
Hammond says an implementation period is very much in the interests of both sides. For example, on 1 April airlines will need to know if they can schedule flights for April 2019.
He says he hopes there will be strong support for it in parliament and in the EU.
Agreeing a withdrawal agreement will be a big responsibility for parliamentarians, he says. He says business will need that reassurance.
Sir Bill Cash, the committee chairman, says he attended a meeting where a lot of MEPs expressed the view that there was not “a cat in hell’s chance” of the European parliament signing off on the kind of agreement the UK wants.
Hammond says he has had meetings with people in the European parliament who have expressed the opposite view.
And that’s it. The hearing is over.
Labour’s Stephen Kinnock puts it to Hammond that it would be simpler to go into Efta (the European free trade association).
Hammond says joining Efta would involve accepting full freedom of movement. That is something the government has ruled out, he says.
Q: But the EEA agreement allows the application of an emergency brake halting free movement?
Only in narrow circumstances, says Hammond. And he says, when Norway considered using these powers, they decided against using them, because the consequences were too extreme.
In the European scrutiny committee David Jones, the former Brexit minister, asks Hammond to confirm there is no question of extending the transition.
Hammond says the government has said the transition period will have to be fixed. The EU has said the same, he says.
He speculates on what might happen if the UK and the EU agreed a transition deal, but then failed to agree a final trade deal.
This is from my colleague Anushka Asthana.
Hammond said that the government could stand down "no deal planning" for March, 2019, once an implementation period is agreed. But he said that even then there may need to be continued planning for "no deal" at the end of transition.
— Anushka Asthana (@GuardianAnushka) March 5, 2018
Back in the European scrutiny committee, in response to a question from the SNP Philippa Whitford, Hammond said he understood well the importance of the border issue in Ireland. He said that in the 1970s he crossed the border himself twice a week, and he has no desire to go back to the kind of border controls that were in place then.
Whitford then asked Hammond about MPs how have called for the Good Friday agreement to be scrapped. Hammond said that people should ignore those voices and listen to what the prime minister says about this instead.
May suggests UK looking at US/Canada border for lessons that could be applied to Ireland
This is what Theresa May said in the Commons when Labour’s Emma Reynolds asked her to give an example of a border between two countries not in a customs union that does not have checks. May replied:
There are many examples of different arrangements for customs around the rest of the world. Indeed we are looking at those, including for example the border between the United States and Canada.
- May suggests UK looking at US/Canada border for lessons that could be applied to Ireland.
But later Jenny Chapman, a shadow Brexit minister, told May there were “guns and armed custom guards” at the US/Canada border. “Surely that’s not what [the prime minister] has in mind?”, Chapman asked.
May replied:
We are looking at the border arrangements in a number of countries around the world. This is something that has been picked up within the European parliament and it has been made clear that there are innovative solutions that can deliver exactly what we’re talking about.
She was referring there to the European parliament report (pdf) that Labour’s Kate Hoey asked about earlier. (See 4.21pm.)
But this report, Smart Border 2.0 - Avoiding a hard border on the island of Ireland for Customs control and the free movement of persons, does not envisage the removal of all border checks. And it sets out procedures that would require infrastructure at the border, something that May has ruled out. Here is a passage from the summary of the report explaining how a “normal border crossing between Ireland and Northern Ireland in a smart border 2.0 concept” might operate. It says:
A company in Norther Ireland needs to move goods to a client in the UK. The company is pre-registered in the AEO [authorised economic operator] database (AEO status or application for AEO Trusted Trader), a simplified export/import declaration is sent, including a unique consignment reference number. The transporting company is pre-registered in the AEO database and the driver of the truck is pre-registered in the Trusted Commercial Travellers database. The simplified export/import declaration is automatically processed and risk assessed. At the border the mobile phone of the driver is recognized/identified and a release-note is sent to the mobile phone with a permit to pass the border that opens the gate automatically when the vehicle is identified, potentially by an automatic number plate registration system. A post-import supplementary declaration is submitted in the import country within the given time period. Potential controls can be carried out by mobile inspection units from EU or UK with right of access to facilities and data, as required.
Updated
Sir Bill Cash, the committee chairman, says the EU draft text of the withdrawal treaty is a hybrid. At some points it treats the UK as a third country. At other points it treats the UK as a member states. If that is not cherry picking, he does not know what is, Cash says.
At the European scrutiny committee David Jones, the Conservative former Brexit minister, asks what the government’s legal text of its fallback plan for Ireland look like.
Hammond says the government has not produced a legal text. It is not clear to the government that it needs a legal text.
He says the government hopes to make progress developing “plan A” - its preferred means of addressing the Irish issue (through an overall new trade relationship).
Corbyn says May has failed to bring clarity to Brexit talks
Here is the start of the Press Association story about Theresa May’s statement.
Jeremy Corbyn claimed Theresa May has “barely papered over the cracks” in her party as the prime minister reiterated her plea to “get on with” Brexit.
The Labour leader warned there has been “20 wasted months” since the EU referendum in which the “arrogance” of some of the cabinet who said it would be the “easiest deal in history” has turned into “debilitating infighting”.
He added the PM had admitted her Brexit plan will reduce UK access to European markets and “leave people worse off”.
His attack came as the prime minister appeared before MPs to repeat Brexit commitments which she outlined in a keynote speech last week.
Speaking in the Commons, Corbyn said: “We’ve seen set piece speech after set piece speech and yet the prime minister still cannot bring clarity to these negotiations and still cannot bring certainty to British businesses or workers.
“The prime minister’s speech on Friday promised to unite the nation, but it barely papered over the cracks in her own party.”
Corbyn said May offered “no real solution” over Northern Ireland, and instead “rehashed an already discredited government idea” to use a mix of technology and goodwill to ensure no hard border.
The opposition leader added: “Doesn’t the prime minister understand, this isn’t just about cross-border paperwork and trade - there is also an issue of maintaining the social peace that has endured for 20 years.”
He asked May to condemn Foreign Secretary Boris Johnson’s “ridiculous remarks” over the Irish border.
Corbyn went on: “We’ve had 20 months of promises, soundbites and confusion.
“However people feel about Brexit, it’s clear to them this government is nowhere near delivering a good deal for Britain.”
May, in her reply, said the government is “focused on making a success of Brexit” and delivering for the British people.
She added: “But Labour has nothing to offer. They voted against moving the negotiations on in the European parliament.
“They twice voted against the bill which delivers Brexit in this parliament. Now they’ve gone back on what they promised over the customs union.
“And over a week ago the shadow chancellor [John McDonnell] said Labour would keep all options open on whether or not to have a second referendum.
“This government and this party is clear: There will be no second referendum. We’re delivering for the British people and we’re going to make a success of it.”
Hammond told the European scrutiny committee that £35bn to £39bn was the central estimate of what the UK would have to pay the EU as it left. He accepted this was based on the assumption that the transition would end on 31 December 2020.
That is when the EU’s current budget comes to an end.
If the transition was longer, the UK would not be treated as being a full contributor to the next budget, he said.
Hammond was also asked about the cost to the UK, in terms of lost tax receipts, from leaving the EU.
He said the Treasury had looked at this, but that it would not be publishing its figures now because that would undermine the negotiations.
Philip Hammond, the chancellor, is now giving evidence to the Commons European scrutiny committee. I will keep monitoring May’s statement, but for the moment I will focus on Hammond.
Sir Bill Cash, the Tory Brexiter and committee chairs, asks the first question.
Q: Do you agree that the UK parliament will have the power to diverge at the end of the transition period on regulations relating to financial services? For example, on Mifid (the markets in financial instruments directive) II.
Hammond says parliament is sovereign.
But it may choose to agree arrangements “of an enduring nature”. He says parliament may not make decisions on every case. It may decide a framework.
But that would be subject to the idea parliament could change its mind.
He says no parliament can bind its successors. He says the EU understand this.
- Hammond says, although the UK may reach what is intended as an “enduring” agreement with the EU on alignment, a future parliament could always change its mind.
In response to a question from Labour’s Emma Reynolds, who asked May to give an example of a border between two countries without a customs union without border checks, May said the US/Canada border was one that that UK was looking at closely.
As the Spectator’s James Forsyth points out, that is a border with infrastructure.
May cites the US/Canada border asa good one to look at it re Ireland, suggests there will be some border infrastructure in the UK's proposals
— James Forsyth (@JGForsyth) March 5, 2018
Labour’s Chris Leslie says last year May promised that the UK would keep the same benefits with regard to trade after Brexit. Does she regret that?
May says that she wants to get a good deal.
Labour’s Ben Bradshaw asks about Trump’s tariff policies, and the FT report saying the US will offer the UK a worse deal on airlines access. Have they made May reconsider the wisdom of leaving the single market?
May says it would be a mistake to have the EU deciding UK trade policy.
Bradshaw was referring to this story in the Financial Times (paywall). This is how it starts.
The US is offering Britain a worse “Open Skies” deal after Brexit than it had as an EU member, in a negotiating stance that would badly hit the transatlantic operating rights of British Airways and Virgin Atlantic.
British and American negotiators secretly met in January for the first formal talks on a new air services deal, aiming to fill the gap created when Britain falls out of the EU-US open skies treaty after Brexit, according to people familiar with talks.
The talks were cut short after US negotiators offered only a standard bilateral agreement. These typically require airlines to be majority owned and controlled by parties from their country of origin.
Such limits would be problematic for British carriers as they have large foreign shareholdings. Under existing arrangements, UK-based airlines are covered by the “Open Skies” treaty that requires them to be majority EU owned.
Kate Hoey, the Labour Brexiter, asks May if she has read the report (pdf) to a European parliament committee setting out a solution to the Irish border problem.
May says she is aware of it. She has asked her officials to look at it. She thinks it could provide a basis for a solution.
Sir Nicholas Soames, a Conservative, asks if the commission have full details of what the UK wants. Can talks proceed apace?
May says the EU now knows what she wants. Her message is, lets get on with it.
Emma Little-Pengelly, the DUP MP, thanks May for her response to the “disgraceful” EU attempt to interfere in Northern Ireland.
May restates her commitment to avoiding a hard border in Ireland.
Labour’s Pat McFadden says May has admitted there will be an economic cost to Brexit. What is it? And who will pay it?
May says life will be different after Brexit. While Labour is just focused on the EU, the goverment wants good trade deals with other countries too.
Jacob Rees-Mogg, the Tory Brexiter, asks if May think it was right of the European commission to behave in such a “high-handed manner”, proposing something unacceptable to the UK.
May says the EU was entitled to publish its document. She says she said it was unacceptable.
Sir Vince Cable, the Lib Dem leader, says after 20 months May has at least achieved a trade deal - with her own cabinet. Would the NHS be covered by a trade deal with the US?
May says the NHS is not for sale.
Sir Bill Cash, the Tory Brexiter, asks May if she agrees that Labour U-turns betray their votes, and the country.
May agrees. They are consistently saying one thing one moment, and another thing they next. And they would not deliver proper Brexit, she says.
Labour’s Yvette Cooper says there would be customs checks and rules of origins checks under May’s plan. And in Ireland she has proposed that 80% of firms should be free from checks. But there would be an increased incentive to smuggling, in an area where smuggling is linked to paramilitary activity. So why is she still proposing this approach?
May says the 80% figure relates to just one of the customs options.
If the UK were in a or the customs union, it would not be able to follow an independent trade policy, she says.
Anna Soubry, the pro-European Conservative, says no one can doubt May’s determination to get a good deal. May was frank about the drawbacks of any deal. There will be administrative costs. Will May keep MPs informed of the administrative costs of leaving?
May says she will make information available to MPs. Some information has been given already.
Hilary Benn, the Labour chair of the Brexit committee, asks May to give a guarantee that manufactured goods and agricultural products will be able to cross the Irish border without checks, control or infrastructure after Brexit.
May says there will be no return to a hard border in Ireland. She says she wants a free flow of goods and people.
John Redwood, the Tory Brexiter, asks May for an assurance that the UK will be able to leave the EU with or without a deal.
May says the government continues to work on all scenarios.
May is responding to Blackford.
She says there are only nine SNP MPs in the chamber today. That is fewer than the number of Scottish Conservative MPs.
She says Blackford has a “tunnel vision”, assuming only one approach to a customs union or the single market is possible.
She says, from Scotland’s point of view, the most important thing is to be part of the UK.
Ian Blackford, the SNP leader at Westminster, says the government is still struggling to write down its wish list. The EU published a draft treaty last week; May just produced rhetoric.
There is no solution to the Irish border problem, he says.
He says Scotland’s voice was not heard when the cabinet committee discussed this at Chequers. But SNP MPs will speak up for Scotland, he says.
He says the SNP will settle for nothing less than continued membership of the single market and the customs union.
Scotland is a European nation, and it intends to stay one.
Iain Duncan Smith, the Tory Brexiter, congratulates May on her speech. He says bringing back control is crucial. Will May tell the EU that cake exists to be eaten and cherries exist to be picked?
May says Duncan Smith is right about how people voted to take back control.
May is responding to Corbyn.
She says she spoke to Trump yesterday. She say she is far more likely to get a good deal from the US engaging with Trump than criticising him from the sidelines, like Corbyn.
She says Corbyn is clear he is opposed to state aid rules, which would be central to a free trade deal. Corbyn does not believe in fair competition, she says.
She says Labour does not know what its position is on free movement. One frontbencher said free movement would end under Labour. But Sir Keir Starmer, the shadow Brexit secretary, said “easy movement” would continue, she says.
She says Labour has nothing to offer. It voted against moving on the talks in the European parliament. And it twice voted against the EU withdrawal bill in this parliament, she says.
Corbyn turns to Ireland. May said in her speech that a customs partnership could be the solution, he says. But he says David Davis himself described this as “blue skies thinking”.
He invites May to condemn what Boris Johnson said about the Irish border last week.
He says there are welcome things about the speech; May has abandoned her red line on the role of the European court of justice. (May is shaking her head.) Corbyn asks May if she will now back Labour’s policy on the customs union.
He ends by saying the government is nowhere near delivering a good Brexit.
Jeremy Corbyn says 20 months have passed since the referendum, and a year since the triggering of article 50. Some of the cabinet said this would be the easiest deal in history. Yet instead we have seen debilitating infighting.
He says the speech barely papered over the cracks in May’s own party.
The EU published a detailed legal document on Wednesday. Where is anything comparable from the UK government?
This government’s shambolic approach to Brexit risks taking us down a dangerous road.
He says May risks tying the UK to EU rules that back privatisation (ie, state aid rules).
Was David Davis wrong when he said Brexit would deliver “the exact same benefits” of the customs union and the single market? If he was wrong, why has it taken so long to say so?
Does May want tariff-free access to the single market?
Does she still think a good trade deal can be reached with the Trump presidency?
Corbyn says it is possible to retain the benefits of the single market and the customs union. But the cabinet is being held hostage by people who want a hard Brexit, he says. They are committed to an ideological crusade which would shrink the state and begin a race to the bottom.
Corbyn says May said in her speech that there was no support in the UK for a race to the bottom on standards. But Liam Fox has said current employment rights are unsustainable, Andrea Leadsom has proposed getting rid of rights, Boris Johnson has described regulations as “backbreaking” and the Brexit department has said there are advantages to be gained from deregulation.
He says there clearly is a political constituency for deregulation. It is called the cabinet.
May says she is confident the UK can set an example to the world. That generate a lot of Labour jeering.
The Times’s Patrick Kidd is getting so bored he’s taken to studying Boris Johnson’s hair.
Not the deepest of political analysis this but Boris Johnson's hair looks different today. Less gold-blond and given a proper parting rather than just a mop. Is he trying to be taken seriously?
— Patrick Kidd (@patrick_kidd) March 5, 2018
This is from BuzzFeed’s Emily Ashton.
In chamber for PM's Brexit statement. Boris Johnson sitting close by, nodding along sagely.
— Emily Ashton (@elashton) March 5, 2018
May is still giving her statement. It really is just a condensed version of the Mansion House speech. The Mail’s Tim Sculthorpe thinks she’s wasting our time.
I'm really not sure the PM needs to largely repeat her Brexit speech for MPs to ask questions about it.
— Tim Sculthorpe (@timsculthorpe) March 5, 2018
Theresa May is making her statement now.
She says the December agreement struck at the end of phase one of the talks is being turned into a draft legal text.
They are close to agreeing a transition, she says.
Now they must turn their attention to the future relationship.
She is now summarising what she said in her speech.
Theresa May's Commons statement on Brexit
Theresa May will shortly be making a Commons statement about the Brexit policy she set out in her Mansion House speech on Friday.
Here is our report of the speech.
And here is the full text of the speech.
May is not expected to announce anything new in her statement. But she may well give new insights into her thinking when she takes questions. (It is not unusual for almost 100 MPs to get called for a statement like this; May is likely to be on her feet for a good two hours or more.)
It will also be interesting to see how MPs respond. On Fridays Conservative MPs, regardless of whether they were on the hard or soft end of the Brexit spectrum, were almost all supportive. But, as Matthew d’Ancona wrote in his Guardian column this morning, the truce is unlikely to last.
Garrett Carr, who has written a book about walking along the Irish border, has written a lovely article for Guardian Opinion about what it’s like, and why border controls would cause so much difficulty. Here’s an extract.
Halfway into my journey I arranged to meet a friend in a border-town cafe; he was driving up from Dublin. At our table, with other customers around, I was appalled by his unguarded statements and his loud voice – things that had never bothered me before. I realised that I had become acclimatised to the borderland’s restraint and political sensitivity.
Please note: it is sensitivity as opposed to secrecy. There are people carrying secrets certainly – I’m sure I met some – but for most the evasiveness comes from a lifetime of avoiding sore points. One evening I walked into a bar sited directly on the line of the border. I could pay for my pint in pounds or euros. A sign above the counter read “Please do not discuss politics”. Along the border two neighbours could be friends for 30 years and never once discuss how they vote. They know better. You might think this is a shortfall in their relationship; something for ever held back that means they are not truly friends. You might have a point.
This highlights one of the great treasures of the Good Friday agreement; it moved the conversations on. You did not have to pick one of two sides any more. Most people moved towards areas of consensus, the value of peace and an open border. “Sure there is no border any more,” one farmer told me. Strictly speaking this was untrue, and he was actually pointing towards the border at the time, where it ran with a river along the bottom of his field, but it was true enough that he could make the claim with confidence. The border is not there if your identity prefers it absent. On the other hand, if your identity depends on the border, then it is there for you.
And here’s the article.
Shelter, the housing charity, has welcomed Theresa May’s housing speech. In a statement its CEO, Polly Neate, said:
We welcome today’s speech for recognising the scale of our housing emergency, and the fact our current housebuilding system is clearly not fit for purpose.
The prime minister has shown the government is willing to take on developers and challenge them over unfair practices that deny communities the affordable homes they need.
We’ve been campaigning long and hard on viability assessments – a tool exploited by developers to wriggle out of building their fair share of affordable homes – so we’re pleased the government is listening, and taking steps to close the loophole.
But, like the LGA (see 9.41am), Shelter is also calling for councils to be given the power to borrow more money to fund new house building.
Lunchtime summary
- The Irish prime minister Leo Varadkar has ruled out Ireland holding a specific negotiation with the UK on a solution to the Irish border problem after Brexit. (See 10.58am.)
- President Trump has used Twitter to express his determination to press ahead with imposing big tariffs on steel and aluminium imports, saying that America’s “friends” as well as its enemies have been taking advantage of it for years. His comments suggests that Theresa May has so far failed to persuade him to back away from triggering a trade war. (See 9.10am.)
- Lord Ashcroft, the polling expert and former Conservative deputy chairman, has published polling about voters’ views in London suggesting that 60% of Londoners disapprove of the government’s record. Here is an extract from his commentary in the Evening Standard.
Londoners gave Mrs May an average performance score of 35 out of 100, compared to 47 for Jeremy Corbyn and 53 for Sadiq Khan, who topped our table. Some admired her stoicism, but she tended to arouse sympathy rather than anything more positive (“I’m surprised she hasn’t had a nervous breakdown,” as one of our focus group participants put it). And those were the charitable views.
But how much does this matter in a local election? Whatever else is going on, surely Londoners associate the Tories with good services and value for money?
Well, up to a point. Even in Conservative authorities, I found only a third of voters, and less than half of 2017 Tories, associating the party with lower council tax; fewer than one in five, and one in three Tories, think of them as offering both.
And here is a chart from his more detailed report.
Updated
Here is some assorted reaction to the Theresa May housing speech.
From John Healey, Labour’s housing spokesman
We’ve heard hand-wringing on housing from Theresa May before, but there’s nothing new here that will make a difference. After eight years of failure, it’s clear this Government has got no plan to fix the housing crisis.
Home-ownership has fallen to a thirty-year low, rough sleeping has more than doubled and the number of new homes built for social rent has fallen to the lowest level since records began.
From Wera Hobhouse, the Lib Dem communities spokesperson
The Conservatives cannot rely on the private sector to provide affordable housing. Housing developers will always act in the best interests of their shareholders, which means keeping house prices high. The Liberal Democrats are calling for tens of billions of real investment in new housing.
From Jay Das, a planning partner at the law firm Wedlake Bell
There is very little “new” in the prime minister’s speech for new-home developers. Theresa May has stated that if developers are sitting on planning permission, then councils will be able to penalise developers. It is difficult to see how this will particularly assist new homes being built. Details are subject to the findings of Sir Oliver Letwin’s review and applications may be many months if not years away. There are many reasons why build out rates can be slow and they are often unintentional. As such, a penalty system will not make a marked difference. The detailed changes proposed to viability assessments will be much more interesting.
From Jane Gratton, head of business environment at the British Chambers of Commerce
Planning revolutions have often been promised, but usually turn out to be a false dawn, given that businesses report that it never seems to get easier, faster, or cheaper to secure planning permissions and crack on with development.
The last time the government upended the planning system six years ago, the framework was slimmed down, but the bureaucracy, delays and cost were not. This time things must be different.
From Sam Dumitriu, head of research at the Adam Smith Institute
The Campaign to Prevent Real Estate may object, but the prime minister is right to take-on nimby councils in high-demand areas. Restrictions on new development push rents up and hold back productivity by pricing workers out of the best jobs. But we must go further and build on the green belt.
Building on the Green Belt doesn’t mean ugly sprawl or trashing the environment. If we only freed up intensively farmed land within a ten-minute walking distance of a train station for development, we could build one million new homes.
At the Number 10 lobby briefing Theresa May’s spokesman stressed that the prime minister had raised her “deep concern” about the expected announcement on steel and aluminium tariffs when she spoke to President Trump yesterday. (See 9.10am.) However, the spokesman added that the UK did not know what the announcement would say and would “wait for the details before anything further to add”.
Asked if the government was still confident of a trade deal with the US, he said it was.
I think both the prime minister and the president have been clear on the importance of reaching a bilateral, post-Brexit trade deal.
The USA is our biggest trade partner, we invest over £500bn in each other’s economies and over 1m Americans work for UK companies, so you would expect us to remain close partners and continue to work at the highest levels to make the case for UK industry to the US government.
Asked if the UK was lobbying for an exception to the tariffs given the close relationship, the spokesman said he could not add to the read-out.
However, he did confirm that as long as we are members of the EU we would operate our trade policy as part of the bloc.
Aid organisations have reported 80 cases of harm or risk of harm, Mordaunt says
Aid organisations have reported 80 current and historical cases where people have been harmed, or have been at risk of harm, to the Charity Commission since February 12, Penny Mordaunt, the international development secretary, said this morning. The cases span 26 charities and groups and cover the “full spectrum” of safeguarding incidents, she said.
As the Press Association reports, seven of the organisations came forward with cases that have been reported within the current financial year. Officials said they did not know if any of the incidents involved children and refused to name the charities involved.
In a speech this morning at a safeguarding summit in central London, Mordaunt warned predators exploiting the aid sector that there was “no hiding place”. She said: “We will find you, we will bring you to justice. Your time is up.”
Mordaunt said that since the Oxfam Haiti sex scandal new standards have now come into force that aid organisations must meet to be eligible for government money. She explained:
These standards will include an assessment of codes of conduct, how organisations identify and respond to incidents, and how their risk management places safeguarding and beneficiaries at the very core.
That assessment will set the bar at a level of the very best - a bar that we will continue to push higher - from our work here today and in the time to come.
Our standards will be world-leading. They will be tough and exacting.
Organisations should not bid for new funding unless they are prepared to meet these tough new standards. We will not approve funds to them unless they pass our new standards.
May's Q&A - Summary
Here are the main points from Theresa May’s Q&A after her housing speech.
- May rejected Local Government Association criticism of her plans [see 9.41am], saying the government has already responded to its proposals. The LGA wants councils to be allowed to borrow to build home. May said the government was already allowing this. She said:
We have increased the borrowing cap for certain councils to be able to do exactly that, because that was a message that the Local Government Association gave to us and we responded to it.
- She denied that she personally was a ‘nimby’. Asked about reports (like this one) that she has opposed new housebuilding in her Maidenhead constituency, she replied:
This is about building the right homes in the right places. That’s what the planning process is actually about. The planning process is a process which ensures that developments, that proposals for developments, are looked at properly. And, yes, I have opposed a number of developments in my own constituency. I have also, for what it’s worth, supported a development on a green belt site which had previously been built on.
‘Nimby’ is an acronym for ‘not in my backyard’, making nimby slang for someone who opposes any housing developments that might adversely affect them personally.
- She implicitly accused the BBC of being pre-occupied with Brexit. In response to a question from the BBC’s Vicki Young about Brexit, she said:
Being the BBC, of course you were always going to get Brexit into the question.
The jibe was more interesting than May’s reply, which was just about wanting financial services to be included in a trade deal.
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Q: Is the government now prepared to deliver on the threats issued to developers who don’t build?
May says the government is now committed to making sure homes get built.
And that’s it. The Q&A is over.
I will post a summary shortly.
Q: Do you think empty retail property should be converted into homes? And if developers pay bonuses based on how many homes are built, doesn’t that smack of Stalinist tractor production targets?
May says in her speech she made the point that there can be a perverse incentive if bonuses are just paid on the basis of profit.
With regard to retail property, she says the new planning rules should make it easier for empty shops to be turned into homes. She also wants to make it easier for people to develop upwards, she says.
Q: How far will you go to in forcing councils to allow more homes to be built?
May says the government wants to ensure that local plans get followed.
Q: On Brexit, the CBI say they are worried about financial services not being included in a deal.
May says it is typical of the BBC to ask about Brexit.
The Mansion House speech made it clear that the UK wants a partnership on financial services, and on other financial services too.
Q: Your junior housing minister said she would resign if homelessness got worse on her watch. Will you make a similar pledge if new houses don’t get built? And you have opposed new housing in your constituency. Are you a nimby?
May says the government is committed to getting more homes built.
But the issues is ensuring homes get built in the right places. She admits she has opposed homes being built in her constituency. But she she has backed other developments.
May's Q&A
May is now taking questions.
Q: The LGA says your speech is unhelpful and misguided. [See 9.41am.] It says the only way we can build enough affordable homes is if councils can be free to borrow. What is your response?
May says the government has already raised the borrowing cap, allowing some councils to borrow more.
But this is a problem that all sides need to address - government, councils and developers.
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Irish PM rules out Ireland having specific negotiation with UK on border issue
In her Mansion House speech on Friday Theresa May said that the UK government would start talking directly to the Irish government about how to address the Irish border issue. She said:
We have been clear all along that we don’t want to go back to a hard border in Ireland. We have ruled out any physical infrastructure at the border, or any related checks and controls.
But it is not good enough to say, ‘We won’t introduce a hard border; if the EU forces Ireland to do it, that’s down to them’. We chose to leave; we have a responsibility to help find a solution.
But we can’t do it on our own. It is for all of us to work together. And the taoiseach [Irish prime minister] and I agreed when we met recently that our teams and the commission should now do just that.
In an interview with RTE’s Morning Ireland today the taoiseach, Leo Varadkar, played down the significance of these talks, saying they would not amount to a specific negotiation. “There won’t be tripartite or three-way talks,” he said. He went on:
What will happen is that there will be talks between the EU 27, and the UK and Ireland is part of the UK 27, and we’re much stronger, by the way, as one of 27.
We will, of course, have negotiations about what could be done to avoid a hard border but what we won’t be getting into is a negotiation with the UK, or a three-way negotiation.
That’s not in our interest and not the way that this can be concluded.
Speaking about the speech generally, Varadkar gave it a guarded welcome, but said more detail was needed.
What we want is not so much principles and aspirations and red lines. What we want is detail, written down in black and white that can be codified into law and that is what is required.
Theresa May is giving her housing speech now. Since it has been well trailed, I won’t cover what she says minute by minute, but I will zoom in for the Q&A (if I can), and post a summary of anything new when the full text is available.
Yesterday, ahead of Theresa May’s announcement, the LGA chair Lord Porter (see 9.41am) posted this on Twitter.
If we want more houses, we have to build them, not plan them. If we want cheaper homes, we have to build them, not plan them. MHCLG need to push back agains HMT or the nonsense will go on and nothing will change. Less homes built next year than there were this year.
— Gary Porter (@garyporterlga) March 4, 2018
MHCLG is the Ministry for Housing, Communities and Local Government, the new name for the communities department.
Nick Boles, a former planning minister who earlier this year accused the government of “timidity and lack of ambition”, retweeted Porter’s tweet saying he agreed.
This is spot on. We cannot wait for our dysfunctional house-building industry to build the homes we need. https://t.co/Xz8REuXiMh
— Nick Boles MP (@NickBoles) March 4, 2018
He has also posted these.
Encouraging interview with @sajidjavid But his garden towns won't get built without reform of compulsory purchase laws. And we need government to build more houses itself. https://t.co/uOQ5MrHI5c
— Nick Boles MP (@NickBoles) March 4, 2018
Very clear analysis of the causes of our housing crisis by @mattwridley Today's announcements will help but do not go nearly far enough https://t.co/Sl1f3sUlcQ
— Nick Boles MP (@NickBoles) March 5, 2018
And here’s an extract from the Matt Ridley column in the Times (paywall) that Boles endorsed. Ridley said:
So why is British planning so restrictive? Until 1947 Britain regulated housebuilding in most cities the same way other countries did: by telling people what they could build, rather than whether they could build. As Nicholas Boys Smith, director of Create Streets, told a recent conference at the Legatum Institute, in the centuries following the Great Fire of 1666 “there was a series of pieces of legislation that set down very tight parameters: ratio of street width to street height, the fire treatment of windows etc. That is how most of Europe still manages planning. They have not taken away your right to build a building.”
Britain switched to deregulating what you could build, but nationalised whether you could build, by adopting a system of government planning in which permission to build was determined by officials responding to their own estimate of “need”. This brought great uncertainty to the system, because planning permission now depended on the whims of planners, the actions of rivals and the representations of objectors. Today local plans are often years out of date, if they exist at all, and are vast, unwieldy documents, opaque to ordinary citizens and subject to endless legal challenge and revision.
TUC general secretary to meet SNP, Lib Dem, Plaid and Green leaders to discuss pro single market campaign
In January the SNP organised a meeting of opposition parties in the Commons to discuss coordinating efforts to keep the UK in the single market after Brexit. The Lib Dems, Plaid Cymru and the Green MP Caroline Lucas attended, and the group posed for a picture alongside an empty chair for Jeremy Corbyn to highlight his refusal to attend.
Tomorrow the SNP, the Lib Dems, Plaid and the Greens are holding another meeting at Westminster - and this time Frances O’Grady, the TUC general secretary, is attending. The TUC has also called for the UK to remain in the customs union and the single market.
Ian Blackford, the SNP’s leader at Westminster, said in a statement:
I’m delighted that Frances O’Grady, has agreed to meet with us to discuss the serious impact that Brexit will have on workers’ and citizens’ rights, jobs and the livelihoods of millions of people.
Time is running out for Theresa May. Her own government’s economic analysis warns of the significant damage that Brexit will do to our economy.
It’s time she heeded our calls to remain in the single market and customs union and the concerns from the TUC about safeguarding the rights of millions of workers.
Since the meeting in January Corbyn has announced that Labour is committed to keeping the UK in a customs union with the EU after Brexit for good. But Labour is still opposed to remaining in the single market (partly because that would involve accepting freedom of movement, but partly because Corbyn is worried about being bound by EU state aid rules). O’Grady’s decision to line up with the SNP, the Lib Dems, Plaid and this Greens on this issue will encourage Labour pro-Europeans who hope Corbyn can be persuaded to shift further.
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Tory-led Local Government Association says May wrong to suggest councils to blame for housing shortage
Downing Street released lengthy extracts from Theresa May’s housing speech overnight. My colleague Anushka Asthana has written them up here. As she reports, May will hit out at the “perverse incentive” of housing industry bonus structures paying out millions of pounds to chief executives as a result of company profits rather than the number of homes built.
But May’s focus on planning rules, and the proposal for “Nimby” councils that do not approve enough homes to lose their say over planning, have angered the Conservative-led Local Government Association. Lord Porter, the Tory councillor who chairs the LGA, said in a statement:
In the last year, councils and their communities granted nearly twice as many planning permissions as the number of new homes that were completed. Councils approved more than 321,000 new homes in 2016/17, while there were around 183,000 new homes added in the same year. More than423,000 homes with planning permission are still waiting to be built.
The truth is that councils are currently approving nine in 10 planning applications, which shows that the planning system is working well and is not a barrier to building. Nearly three-quarters (73 per cent) of planning refusals are upheld on appeal, vindicating councils’ original decisions.
It is completely wrong, therefore, to suggest the country’s failure to build the housing it desperately needs is down to councils. The threat of stripping councils of their rights to decide where homes are built is unhelpful and misguided.
Porter also restated the LGA’s long-held demand for councils to be allowed to borrow so that they can build homes themselves. He said:
The last time the country delivered 300,000 homes which this country needs each year, in the 1970s, councils were responsible for more than 40 per cent of them and it’s essential that we get back to that. In order for that to happen, councils have to be able to borrow to build homes again.
Ultimately, the private sector will never build enough of the homes the country needs on its own. The Government must back the widespread calls, including from the Treasury Select Committee, for council borrowing and investment freedoms to spark a renaissance in house building by local government.
Trump rejects May's call for him to back away from plans for trade war over steel
Theresa May’s attempt to persuade President Trump to rethink his plan to trigger a trade war by imposing big tariffs on steel and aluminium imports doesn’t seem to be working. She was scheduled to speak to him yesterday about Syria, but when the call came she also took the chance to raise her concerns about his new tariff proposals. In the read-out released to journalists afterwards, Number 10 said:
The prime minister raised our deep concern at the president’s forthcoming announcement on steel and aluminium tariffs, noting that multilateral action was the only way to resolve the problem of global overcapacity in all parties’ interests.
The statement doesn’t record how Trump responded. But Downing Street read-outs of this kind are famous for their blandness, and if they are using phrases like “deep concern”, then presumably it must have been quite a frosty and awkward exchange.
No 10 may not have commented on the president’s reaction, but the president himself posted a tweet on the subject last night and it makes it clear that he’s not taking much notice of May’s concerns.
We are on the losing side of almost all trade deals. Our friends and enemies have taken advantage of the U.S. for many years. Our Steel and Aluminum industries are dead. Sorry, it’s time for a change! MAKE AMERICA GREAT AGAIN!
— Donald J. Trump (@realDonaldTrump) March 5, 2018
That reference to “friends” presumably includes the UK.
The ramifications of this don’t just apply to steel and aluminium. Trump’s response also illustrates the dangers of relying for a post-Brexit economic strategy too much on striking a free trade deal with someone who does not actually believe in free trade.
May will be giving a speech this morning on housing. And then she will be in the Commons this afternoon making a statement on Brexit. At some point she will doubtless be asked about the Trump tweet.
Here is the agenda for the day.
9.30am: Penny Mordaunt, the international development secretary, gives a speech at a safeguarding summit with aid charities.
10am: Theresa May gives a speech on housing. As Anushka Asthana reports, she will hit out at the “perverse incentive” of housing industry bonus structures paying out millions of pounds to chief executives as a result of company profits rather than the number of homes built.
11am: Downing Street lobby briefing.
11am: Michel Barnier, the EU’s chief Brexit negotiator, meets the Sinn Fein leaders Mary Lou McDonald and Michelle O’Neill in Brussels.
After 3.30pm: May gives a statement to MPs about her Brexit speech.
4.30pm: Philip Hammond, the chancellor, gives evidence to the European scrutiny committee about Brexit.
As usual, I will be covering breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web. I plan to post a summary at lunchtime and another in the afternoon.
You can read all today’s Guardian politics stories here.
Here is the Politico Europe round-up of this morning’s political news from Jack Blanchard. And here is the PoliticsHome list of today’ top 10 must reads.
If you want to follow me or contact me on Twitter, I’m on @AndrewSparrow.
I try to monitor the comments BTL but normally I find it impossible to read them all. If you have a direct question, do include “Andrew” in it somewhere and I’m more likely to find it. I do try to answer direct questions, although sometimes I miss them or don’t have time.
If you want to attract my attention quickly, it is probably better to use Twitter.
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