Exclusive: Most of the UK has fallen further behind London & the South East since Boris Johnson became prime minister, a major blow for `levelling up' 1/
Q: Won’t voters be really annoyed when Brexit continues to dominate TV, radio and newspaper coverage in 2020 because of the EU trade negotiation, when you said it would be over?
Johnson: No, because Brexit will in fact be done.
Hmm... 🤔
Alok Sharma was asked three times whether supply of the vaccine will be affected by Brexit disruption. On each occasion, he did not give a clear answer.
Remarkable exchange at trade committee just now.
Q: How do benefits of trade deal with New Zealand compare to the economic harms of Brexit (e.g. 4% reduction in GDP, per OBR forecast)?
A: ``I haven't done those statistics,'' Britain's trade secretary says 🤷♂️ 1/
One year of Brexit has led to:
-- Reduced trade and economic growth 📉
-- Higher cost of living 🛒🥵
-- A weaker City of London 🙅♂️💰
Here's what Brexit did to Britain in 2021... 1/
New: On the 6-year anniversary of the Brexit vote, the UK government was asked to identify the biggest benefits of the split. The answer raised some eyebrows... 1/
Remarkable exchange in the Commons just now.
@hilarybennmp
asks Gove if Brexit IT systems are ready, after the Road Haulage Association said they're not.
Gove has a dig at the RHA, says they `haven't been the most constructive partner' - then doesn't answer the question 1/
Interesting Brexit narrative now coming from government about potential chaos when transition period ends.
Warning that disruptions will be due to `failure of EU to plan' 1/
New: EU hauliers are refusing deliveries to the U.K. in January, due to threat of Brexit border chaos. Excellent story by my colleague
@alexlongley1
1/
Lord Frost says the government will hire an external adviser to identify post-Brexit opportunities. ``We have high hopes of outside input into this process,'' he says.
New: 86% of the seats Boris Johnson won from Labour in the `Red Wall' have fallen further behind London & the South East since he became prime minister 1/
Today reminds me of this brilliant exchange with Michael Gove last week.
Lord Oates asked: Who does the `we' refer to when the government says `we' will prosper under Australia-style terms? Is it business, farmers, the services industry?
Gove: `The Government.'
In sum, deal or no-deal, trucks will have to go through the headache of a new bureaucratic process, which relies on an IT system that is yet to be built, from a govt with a poor record on IT projects.
Get it wrong, and the UK suffers economic pain 9/
OBR statement on trade in budget docs. Compared to average 2019 levels:
-- U.K./EU trade down 15%
-- U.K./non-EU trade down 7%
So pandemic has hit both, but a clear Brexit impact.
Think back to the summer. Liz Truss and Rishi Sunak fought to be prime minister with competing visions on the economy. Sunak = be cautious, disciplined, bring down inflation. Truss = go for growth, borrow more, reject Treasury orthodoxy... 2/
And that's it really. There's little else for it. Truss and Kwarteng are currently sticking to 1). Whether that's sustainable will depend on behaviour of the markets -- and whether her MPs allow her to go on. Tory conference will be interesting... ends/
In this video Sunak says ‘debt is falling’.
@TheIFS
: ‘It's not accurate to say that debt is falling. Public sector debt is currently rising in cash terms, real terms, and (most importantly) as a per cent of national income.’ 1/
This King’s Speech delivers change.
Change in our economy.
Change in our society.
Change in our communities.
It takes long-term decisions for a brighter future ⬇️
It's been another torrid week at the border - inundated customs agents, goods stuck for days, companies buckling under the paperwork 1/ w/
@lizzzburden
Q: Won’t voters be really annoyed when Brexit continues to dominate TV, radio and newspaper coverage in 2020 because of the EU trade negotiation, when you said it would be over?
Johnson: No, because Brexit will in fact be done.
Hmm... 🤔
Starmer goes hard on Johnson's false claim there will be no non-tariff barriers to trade with the EU. Twice asks Johnson to correct the record. He does not 1/
For its part, the EU says it's ready to handle new customs checks at ports etc.
If anything, the bigger concern seems to be lack of U.K. readiness - drivers turning up at EU border with incorrect paperwork, gov is building lorry parks as protection 4/
Latest Brexit data - trade in goods with EU countries decreased 23.1% comparing Q1 2021 to Q1 2018. Trade with non-EU countries decreased 0.8%, according to
@ONS
There's no reference to the `opportunities' of Brexit in this urgent message from Alok Sharma. That's a shift in tone - govt now stressing that businesses must act or else Brexit will hurt
JPMorgan told about 200 staff today to plan to move out of London because it sees little prospect of the U.K. winning a deal on financial services via
@business
‘It’s news to me,’ Deputy Prime Minister Therese Coffey says, when asked about UK financial market instability on Sky News this morning. Surely that’s not the line..
- Not publishing an independent fiscal forecast from the Office for Budget Responsibility (looked sketchy)
- Not announcing a medium-term plan to bring the public finances under control (looked like abandoning discipline).. 10/
I asked the PM's spokesman if companies face more or fewer trade barriers since Brexit. He twice declined to answer. That's strange, given Brexit was sold as a project that would make Britain a `freer-trading' nation. The answer should be yes... 9/
Replying to the `Brexit Opportunities' statement, Labour's
@EmilyThornberry
tells the govt to leave a `fantasy world' and join the reality of `delays, shortages, red tape and lost trade'
New: as U.K. exports to the EU fell 40% in January, British firms are angry that they're drowning in red tape -- while imports from the bloc are being waved in to Britain 1/
``That's something that's beyond our control. That would be our biggest concern''
So the gov setting its stall out early -- any Brexit problems at the border will be blamed on the EU 3/
It was also against the backdrop of having fired the most senior civil servant in the Treasury, Tom Scholar. Again, this was a negative signal for markets, another blot on the Kwarteng/Truss copybook and their perception of trust on the economy 11/
This is a pretty stunning paragraph in the EU's letter to Michael Gove. It effectively claims the U.K. is not enforcing the Northern Ireland Protocol 1/
Why? It's worth remembering that markets are like a beauty contest. You're constantly being judged against what your peers are doing (US, France, Germany, Japan etc), where investors could also be putting their money. So you must be very careful about... 8/
So the markets open on Monday and £ crashes to all-time low against the $. £ weakness has a significant real-world harm for the UK -- it makes imports more expensive and Britain imports a lot more than it exports. That means higher prices in shops... 13/
Exclusive: the government's original analysis of the Australia trade deal would've shown a negative impact on Northern Ireland.
But officials have now changed their workings, so now it will show a positive impact 1/
Exclusive: Brexit has created at least 500 jobs in Bosnia-Herzegovina and the Philippines in recent months, as companies turn to overseas labour amid a U.K. shortage of customs agents
So the blame game is starting early - expect more of this...
And with 100 days to go until it all becomes a reality, a quick-fire reminder of what needs sorting on the UK side 6/
Quick explanatory pause -- if US interest rates are higher than UK interest rates, that boosts the $ versus the £. Investors want to put more of their money in $-denominated bonds (bigger returns) than £-bonds, so they buy $, sell £ 5/
In other words, 4 years on from the Brexit referendum, there is still no confirmed plan for how lorries can seamlessly cross between the U.K. and EU after the divorce 4/
So the markets deliver their initial brutal verdict, £ slumps, UK bonds fall. Kwarteng then makes matters worse over the weekend by saying he wants to press ahead with more tax cuts -- amplifying the message and gung-ho approach that spooked markets 12/
And in a sign of potential trouble ahead, he said he'd received multiple calls from businesses today who thought they didn't need any new paperwork to cross the border, because the free-trade deal meant they could continue as normal (😱) 5/
These constructions, and the inability for local authorities to push back on them, could prove quite unpopular. With every passing day, Brexit becomes visibly more real ends/
Exclusive: The UK's poorer regions are falling further behind London & the South East, despite the promise to `level up' Britain.
Major update to Bloomberg's levelling up tracker published today 1/👉
Sending out negative signals for investors which make you look less safe, trustworthy than your peers. *Perceptions are crucial*. But the Kwarteng plan had various red flags which were punished, including.. 9/
Breaking: the U.K. and Canada are on the brink of signing a free-trade agreement, replacing the deal Britain has through EU membership. Announcement expected within days w/
@kbolongaro
@TimRoss_1
To conclude, some realism from HMRC about what has to be done to make Brexit work.
But also concern about new IT project, unprepared biz, extra costs of complying, and Brexit generally making life harder for key arteries of the U.K. economy ends/
Even if Britain and the EU sign a free-trade agreement, this will be the system.
It is the consequence of leaving the EU's customs union -- all goods will require customs declarations. And the EU says it won't allow a truck in without a declaration 8/
🔥🔥 q from
@singharj
at daily lobby briefing after No. 10 repeatedly insists this was a work meeting, with a glass of wine in front of PM.
``Can the public be confident that decisions affecting them are made in Downing Street by people who are sober?''
The crucial question in the Internal Market bill debate, asked by
@hilarybennmp
. Why isn't Article 16 (the safeguards provision) of the Northern Ireland protocol enough to protect the UK from the EU acting unreasonably? Why the need to break international law?
Truss enjoyed a big polling lead through the contest and ultimately won. Financial markets were already getting nervy over the summer, with UK assets declining in anticipation of her victory... 3/
Situation calms a little on Tuesday, but still very volatile. Then the International Monetary Fund comes out and gives the UK a slapdown over its economic plan, a big embarrassment for a major economy... 18/
It all comes to a head on Friday when Chancellor Kwasi Kwarteng reveals their plan, including biggest tax giveaways in half a century and extra £70 billion of government borrowing to pay for subsidising energy bills. It really spooks financial markets.. 7/
A House of Lords committee has just heard stark evidence from industry that critical systems won't be ready on Jan. 1, especially the customs system for Northern Ireland, known as CDS (Customs Declaration Service) 2/
Meanwhile the UK's borrowing costs started to rise quite alarmingly. (Quick explanatory pause - when bonds are falling, their `yield' rises eg the debt interest you pay on the bond. Falling govt bonds = higher costs of borrowing = bad for govt...) 14/
New: Brexit blamed for £850 million decline in beauty exports from the UK, according to a report backed by brands including Space NK and L'Oreal via
@business
@sabahmeddings
2) U-turn, drop parts of the economic plan (eg row back on the top rate tax cut, shift strongly and relentlessly to a message of fiscal prudence), apologize, say you tried to do too much too quickly, bite the bullet, hope markets reward you (not guaranteed).. 23/
It's just strange the UK government doesn't frame it in this way. Instead we get the evasion like we did today, an unwillingness to confront what's happened... ends/
So what now for Kwarteng and Truss? They've created a situation verging on a financial crisis, requiring the central bank to step in to make amends for their economic plan. Their options are... 21/
And anyone who's played our Brexit game will know about the new red tape that's coming for firms, and how the plan is for *UK officials* to be diverting trucks to lorry parks 5/
Curiously, there is just a blank page where there's supposed to be the process for roll-on, roll-off freight e.g. the ~10,000 trucks that go through Dover-Calais each day.
It's called the `pre-lodgement' model, where customs paperwork is filed electronically in advance 3/
You can see how your individual constituency has performed on our Levelling Up Scorecard in each of the metrics we tracked - it's free to use at the bottom here 6/