Hammond has no part to play in Brexit Cabinet

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Hammond has no part to play in Brexit Cabinet

To leave the EU with the best Brexit deal possible, the Prime Minister needs a Cabinet that is fully committed to securing Britain’s future outside the European Union, says Peter Lyon. 

Contrary to rumours circulating before Christmas, Philip Hammond has retained his position as Chancellor of the Exchequer in this week’s reshuffle – despite the Prime Minister, apparently, wanting to move him aside for some time. On numerous occasions during the Brexit negotiations, the former Remain campaigner has acted contrary to the national interest by his words and actions, potentially harming our objective to get the best Brexit deal for the United Kingdom, outside the Single Market and Customs Union. Leave voters across the country will be concerned about Theresa May’s decision to maintain Hammond’s role at the centre of Government.

Ever since the EU Referendum, Hammond has been the most prominent member of the Cabinet constantly pushing for a soft Brexit. In Cabinet discussions, he has favoured remaining tied to the Single Market and the Customs Union – according to him, to prevent disruption to business. Yet any deal which keeps the UK in the Single Market would mean continuing the jurisdiction of the European Court of Justice (ECJ) and the free movement of people. Maintaining a Customs Union with the EU would prevent Britain signing free trade deals with countries around the world like the US, Australia and China – a key benefit of Brexit.

The Chancellor has favoured a long stand-still transition period, but this would have meant continuing Freedom of Movement and ECJ jurisdiction for many years into the future. Fortunately, it now looks likely the transition period will end on 31st December 2020, after this was suggested by Michel Barnier. Hammond does not appear to realise, or want to recognise, regaining control of immigration was one of the key motivations for many during the Referendum campaign. Across the country there are significant concerns about the effect of mass immigration on communities, public services and jobs. The Government must declare when Freedom of Movement will end and announce a new system of immigration controls. Such an announcement by the Home Office would reassure Leave voters of Remain-supporting Home Secretary Amber Rudd’s commitment to getting the best for Britain from Brexit.

Being prepared to walk away from the table is a basic tactic in any negotiation. In order to achieve a good deal with the EU, we must also show we are ready to walk away and leave without a bad deal if that’s all that’s on offer. However, appearing before the Treasury Select Committee in October, Hammond shockingly refused to commit any funds for Brexit, including to prepare Britainfor a possible No Deal scenario – for example on customs arrangements – until the “very last moment”. Just minutes later, the Prime Minister was forced to rebuke her Chancellor, reassuring MPs: “We are committing money to prepare for Brexit, including a No Deal scenario.”

Brexit tensions between Hammond and Leave-supporting Ministers have happened before. In November, Hammond’s reluctance to get behind Brexit forced Leave campaigners – Environment Secretary, Michael Gove and Foreign Secretary, Boris Johnson – to write a secret letter to the Prime Minister, later leaked to the Daily Telegraph, urging her to ensure the Treasury provided money for No Deal preparations. The leaked letter accused Hammond of lacking “sufficient energy” to deliver a clean Brexit. But disappointingly, after this week’s reshuffle, Hammond is still in place!

After a massive Divorce Bill of around £40 billion was supposedly agreed between UK and EU negotiators as part of Phase 1 of the Brexit talks in December, the Chancellor had the temerity to say said it was “inconceivable” this money would not be paid –even if a beneficial deal on our future trading relationship was not agreed! This ludicrous suggestion of Britain still on the hook to pay a huge £40 billion for nothing in return, was again quickly refuted by the PM, who reiterated: “Nothing is agreed until everything is agreed.

Last week, Hammond apparently refused to rule out Britain staying in a permanent Customs Union with the EU. If this prevents the UK operating an independent trading policy with our potential global partners, this would represent a major betrayal of the Brexit vote.

At every stage in the Brexit talks so far, Hammond has been a huge obstacle to a real Brexit. He has forced the Prime Minister to issue denials and has exasperated Eurosceptics, both in the country and in Parliament. It is a huge shame she has not managed to get rid of him from the Cabinet.

This week Hammond and Brexit Secretary David Davis are visiting Germany to press for a bespoke trade deal with the UK. After his previous pronouncements, we cannot trust him to make our case properly and not to give unnecessary concessions to EU leaders. Let’s hope that with Davis tugging at his coat tails, this will not happen.

As the Government moves into Phase 2 of the negotiations, it must decide whether to pursue an approach of divergence or alignment in its future relationship with the EU. The Prime Minister is expected to articulate her position in a speech, possibly at the end of next week – and must not be weakened by the negative influence of the Chancellor.

In order to achieve the full benefits of Brexit, the UK must be able to take back control of its own regulations and negotiate its own trade deals. This would not be possible under regulatory alignment. Hammond is thought to be the leading opponent of this in the Cabinet. If so, this just goes to prove he has still not come to terms with the EU Referendum result!

Mrs May’s decision to keep Hammond in charge of the Treasury is of huge concern. Replacing him with a Brexiteer Chancellor, as speculated before Christmas, would have given a clear signal of May’s commitment to properly leaving the EU, including the Single Market and Customs Union.

This week’s reshuffle was a momentous opportunity to recalibrate the Government’s Brexit policy in the run up to Phase 2 of the negotiations. Clearly many of the appointments made were about shoring up the Conservative Party itself in advance of local government elections in May. It is disappointing there was no appointment of a Cabinet-attending ‘No Deal’ minister, in spite of rumours. However, it’s good news the prominent Brexit campaigner Suella Fernandes has been appointed to an additional role in the Department for Exiting the EU (DExEU) of Parliamentary Under Secretary of State. This enlargement of DExEU with an MP who strongly believes No Deal is better than a bad deal is most welcome.

If the Prime Minister had been much bolder, and got rid of Brexit-toxic elements of the Party in Cabinet, she would have gained much respect – not only from the Party, but also from the Great British Public. Brexit supporters should be very worried about Philip Hammond’s ongoing influence in the Cabinet, as we needed a confident Brexiteer Chancellor to get the best from our leaving the EU.

To leave the EU with the best Brexit deal possible, taking back control of our laws, our borders and our money, it is vital the whole Cabinet, including the Chancellor, is fully committed to Britain’s future outside the EU. With such a large Remain contingent at the heart of our Government, as well as in Parliament, Get Britain Out is not sure we will get the best possible Brexit the United Kingdom needs. Only time will tell.

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    Peter Lyon
    Peter Lyon is a Research Executive at cross-party grassroots campaign Get Britain Out. He is a graduate of the London School of Economics where he chaired the Hayek Society.
    • timbo_21

      I’m part-way through reading Tim Shipman’s excellent book “Fall Out”. It is very clear that a great many people within the Cabinet regard Hammond as extremely dim, and having no political nouse. The PM has slapped him down on a number of occasions and it baffles me why she’s kept him in place.

      One thing is crystal clear though; if this Conservative Government reneges on Brexit, the party is finished and Hammond and the rest will simply become footnotes in history.

    • RcJ

      Hammond is a liability, has on more than one occasion undermine May, going off on a tangent making presuppositions on areas that clearly step on David Davis toes. Hammond domain is Treasury not Brexit strategy and negotiations, distinct problem with Morgan and Soubry who also act like they run the show

    • Gut Instinct

      All the proclaimed advantages of EU membership focused on trade “benefits”. From its very beginnings, the intention was to very slowly – but progressively and continually – to bind member states so closely together that escaping from it would be nigh on impossible. More recently, the pace has quickened and they have already declared that in due course, “national sovereignty” would in fact be little more than a fact of history for all member states.

      It has become obvious that democracy is anathema to Brussels thinking. For all the proclaimed ability of nations to veto rulings with which they disagreed, the UK veto has been ignored every single time and the rulings became binding on us. Within a couple of years one or two new treaties will make the United States of Europe a fact.

      MEPs are relatively powerless. Unelected Commissioners in Brussels decide – and everyone obeys. Eventually. At the heart of the concept of democracy is the right of a nation’s citizens to decide FOR THEMSELVES who makes the laws that govern them, control their borders, control their foreign policy and defence policy, control the economy. Oh – and KICK THEM OUT in elections if the people decide to change them.

      For Brussels, that is anathema. We are seeing that in the reactions of the EU machine to the popular votes in Denmark, Belgium, Poland and the rest. Brexit highlights that divide. In the united Europe that is the declared intention of Brussels, we’d have as much control of our futures, laws, borders and national infrastructure as any county council in the UK has over Britain’s.

    • Mojo

      Hammond is thinking of himself and his business interests. He clearly doesn’t see the bigger picture. I fell angry with Mrs.May for a different reason though. She had the ideal opportunity to bring in some big Brexit hitters in this reshuffle and yet she clearly put Party before country. The Tories are really losing touch with voters and in particular their grassroots. Most people for the next few years will be thinking of country first and will be upset that we seem to be getting a softer and softer Brexit.

      With Nigel Farage making inflammatory statements today regarding second referendums, I suspect the the Tories will be extremely keen to keep their little pinkies on the tiller of negotiations. A cat among the pigeons has now been released. Business delegations have been to Brussels in a clear showdown to government and Remainers that they are losing their patience. This will open the door, I am sure, for businesses to start talking to each other and bypassing the politicians. So I feel there is a real frustrated movement of Brexiteers rattling the cages of those they feel are betraying their vote.

      • Paul in Eastern Europe

        “Hammond is thinking of himself” Of course, he is a politician.

        Governments always work for the benefit of special interest groups.

        The so called City of London is a powerful lobby and they massively exaggerate how much of the profits they make come from the EU27. They are using this misinformation to suggest that billions of pounds of corporation tax paid by financial institutions are at risk due to BREXIT.

        It is helpful for the City to pretend that the huge aggregate profits are paid by outsiders rather than admitting that the huge profits in the City come from a lack of real competition in the domestic financial services market and a great many very one-sided transactions with borrowers, depositors and ordinary investors.

        Most probably, 80% of the City’s profits are made domestically, perhaps 8% from the EU27 and 12% from the rest of the world.

        Frankfurt, Paris, Milan, Amsterdam and other financial capitals have been trying to eat the City’s lunch for decades It is hard to imagine that BREXIT really makes this easier for them.

        If the EU27 stop the free movement of capital, they will cause a massive own goal. Just the threat of capital controls will cause a huge capital flight. So, outside the EU’s regulatory regime the City should find itself far more competitive than it already is, not less so.

        Even if, we assume that half of the business with the EU27 is lost, that’s only about 4% of the total and we must assume the companies affected will try to use their newly redundant resources elsewhere and that they would quickly recover about half or even more – so the net loss to the City might amount to perhaps 2%

        This is no big deal and a bit more City capacity chasing business in the UK could very easily result in far more corporation tax raised from the wider UK economy compared to the small reduction from the financial services industry.

        Another huge lobby group is the UK Civil Service. The ability to say “yes Minister, but that is illegal under EU law.” has allowed the Civil Service to become the ruling class with the result Ministers and UK taxpayers work for them not the other way round.

        I can imagine that the Civil Service so much regrets their upcoming loss of power as a direct result of BREXIT they are doing everything they can to sabotage it. For certain, a fool like Hammond is being lies upon lies to persuade him that the best result is continued subservience to the EU aka The German Empire.

    • Adam Smith

      Why this enthusiasm for the single market? Our trade with Europe has actually declined in percentage terms since we joined whilst our trade deficit has ballooned, the housing market has become unworkable and the NHS is on the point of collapse.

      Worst of all, if we stay in the thousands of European (and particularly French) businesses that would otherwise invest here in order to take advantage of our flexible workforce and easier, more competitive access to North American markets simply won’t come.

      Policy on this issue is completely dominated by the needs of kleptocrats in the City of London. It’s a disaster for everyone else

    • grumpyashell

      Problem is that May in her reshuffle put more remainers into her cabinet,with that did she show commitment to the Brexit cause….no. Hammond should go because he is a reluctant brexiter plus the country needs a radical shake up of the tax system and he is definitely not the man to do it. The whole system is too big,too complicated and needs simplification,small business needs a system which is workable and business friendly not one were they spend their time doing HMRC work.

    • Malcolm Marchesi

      I agree with much of the article but I also believe the real danger to Brexit comes from the small group of Tory diehards who have already knifed the Government and repeatedly threaten to do it again . I suspect that if the PM moved Hammond in the way that she moved Greening , it would trigger another attack by the Europhile fanatics ( that’s what they are ) and could cause serious problems for the negotiations . If the PM can hold the rebels at bay , all will be well , if she gives them a reason to wield the knife again , they will do so . Accounts can be settled after we are out , until then we must take care !

    • Sgt_Bilko

      Discovering that the majority of Conservative politicians are dodgy Europhiles is not exactly a newsflash. They are a deceitful lot, who cannot be trusted with Brexit and if you search on Google it doesn’t take long to discover that Hammond sold himself as a staunch Eurosceptic up to a few months before the referendum. That’s what Conservatives generally do before selling us out, because they always put themselves before party and the party before the country.

    • The Banana

      Sugar Tax Hammond seems to be going out of his way to annoy as many people as he can.

      • Big Les

        ………#becauseofbrexit, no doubt!

    • Felt

      Ham Head is eminently suited to his other obsession, Buy to Let.

      This traitor, and there is no other word to describe his behaviour. should be dispatched as soon as possible – together with the equally traitorous Ruddy. That he is still in a post, for which he is clearly unqualified and unsuited, is as a result of Maybe’s constant dithering and weakness.

      If the Tories don’t deliver on LEAVE,they are finished. Does Ham Head not understand this ?

      • Paul in Eastern Europe

        Excellent article. Thanks.

        The vote was 52%-48%, but amongst Conservative voters and potential Conservative voters the votes must have been 2:1 in favour of the UK standing on its own feet rather than being a despised and ignored member of the German Empire.

        Mrs May really needs to understand that Hammond is a huge liability not only to the electoral prospects of the Conservative Party but to the prosperity of the entire United Kingdom.

      • Big Les

        We all understood exactly what the €U stance was before June 23rd 2016, and only served to be confirmed post-referendum, and increasingly so with every passing day and demand for ever more money in a ‘divorce settlement’.

        Everybody except Spreadshit Phil, Shariza May, Amble Rudd et al, that is.

        The whole bunch are eminently unsuited to the positions they currently hold.

        Come on JRM, DD and John Redwood – we need you to launch a coup!

    • Leo Savantt

      Perhaps the real reason Hammond remains is that Mrs. May, whilst being less honest, is also doing her up-most to sabotage a real Brexit. She might be more duplicitous but both were Remainers before the referendum and neither appear to have changed their tune. Brexit in name only is all that this government is promising and who knows they might not even honour that pledge.

      • Andy

        I have to agree with you. Hammond has said so many crazy things he should have been sacked – actually May should have ordered him marched into the Courtyard of the Treasury and shot, sacking is too good for him ! – so one is forced to conclude that May either shares his views or he is being used as the outrider. May wont deliver a workable Brexit and never had any intension of doing so. Damn the woman.

        • Mojo

          David Laws said of Theresa May, that you never know the woman and what she is thinking. She keeps everything close to her chest and when things get a little heated she manages to get away with hanging colleagues out to dry. No one in Parliament quite understood how she got away with so many blunders as Home Secretary and yet it was always someone else who took the flack.

          He went on to say in his book that she never networked, or stopped to have tea with colleagues. Her door was always firmly shut. I subsequently attended a talk given by Anne Widdecombe during a summer festival and asked her if she had ever had dealings with Mrs May. Anne said she hadn’t, but then in all her years working in Parliament, no one seemed to know who Theresa May was or what she stood for. Interesting her take was the same as David Laws.

      • Sussex Martlet

        That is the only explanation which makes sense especially given that his performance as chancellor has been so abysmal never mind Brexit.

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