More UK cabinet divisions over EU trade
UK Prime Minister Theresa May said she would forge ahead with a new customs partnership after Brexit, as her business secretary, Greg Clark, was fielded to defend the model against the pro-Brexit lobby inside his party.
Clark declared that the option was still on the table, despite running into fierce opposition from senior frontbenchers at a heated meeting of the Brexit “war cabinet” last week.
Arch-Brexiteer Jacob Rees-Mogg accused Clark of resurrecting the “Project Fear” that failed to win the 2016 referendum, a harbinger of the difficulties that May would face if she pressed ahead with the contentious solution.
Clark told the BBC that thousands of British jobs in car making and other manufacturing industries were at risk if the UK did not minimise friction in trade.
He said a customs partnership deal was crucial to protect “just-in-time” manufacturing, when factories receive goods only when they are needed to maximise efficiency.
Clark raised concerns that foreign firms could locate new factories elsewhere in Europe rather than in the UK, warning that some 3,500 jobs at Toyota’s factories in Derbyshire and North Wales could be under threat.
He said it was “absolutely right” that the UK left the customs union but added that “what we replace it with is of huge importance”.
Clark argued: “We have always said we will have a customs agreement that has the minimum of frictions. That is crucial.”
The business minister was part of the war cabinet that failed to reach agreement on whether to back the hybrid customs partnership, under which the UK would collect import duties on behalf of the EU for goods arriving in Britain, or the so-called maximum facilitation or “max fac” model relying on the extensive use of technology to minimise border disruption.
Brexiteers have rejected the proposed customs partnership, claiming it would keep the UK too closely tied to the rest of Europe and the “war” cabinet is thought to have lined up six to five against it, despite May and Clark backing the model.
Pro-Brexit environment secretary Michael Gove fuelled the row after describing as “helpful” a Twitter conversation by former aide Henry Newman, now director of the Open Europe think tank, which described resurrecting the customs partnership as “surely misguided”.
The British Chambers of Commerce said that having a deal close to the current rules was a “no-brainer”.
“The alternative is greater uncertainty, disrupted supply chains and one costly adjustment after another,” the organisation’s chief Adam Marshall said.
Pro-EU protesters in Manchester last year. Picture credit: Eurasia Times