Brexit, the budget and banks: the government survived a difficult week but is still under pressure
The hotly anticipated pre-Brexit Budget was delivered at the start of last week and the government will be breathing a momentary sigh of relief over the response from the media and its own supporters. However, with the resignation of sports minister Tracey Crouch MP, Dominic Raab's surprise suggestion that a Brexit deal would be finalised by the end of the month (later described as 'shambolic'), and immigration minister Caroline Nokes' meltdown in front of the Home Affairs Select Committee, the week ended on a sour note.
Strong and stable. For now
On Monday, the chancellor Philip Hammond MP delivered his final budget before the UK is due to leave the EU in March 2019. Even though Hammond had a mammoth task in front of him, polling immediately after the Budget showed it was received quite positively by the public. The chancellor's budget included more money for the NHS, more money for defence, more money to high streets, and austerity 'coming to an end'. Although, Hammond was helped enormously by the fact that the Office of Budget Responsibility (OBR) found an extra £13billion due to better than expected tax receipts.
this, the chancellor was clear over the weekend that these spending plans are only possible if the UK can secure a deal with the EU. In the event of a no deal Brexit, the spring statement would turn into a full fiscal event - a spring budget. Secretaries of state, ministers, and officials across Whitehall are still maintaining the line that the Government expects to secure a deal, but it didn't stop the chancellor pumping a further £500million in to no deal preparations, bringing the overall total to £4billion since 2016.
Brexit deal edges closer but nothing has changed
The Brexit secretary, Dominic Raab MP, made the headlines by suggesting, in a letter to the Exiting the European Union select committee, that he expects the Brexit deal to be completed by 21st November - less than 3 weeks away. However, the letter was originally sent on 24 Oct and only released during the week. His department immediately sought to downplay the admission but it didn't stop the value of pound rising in the short term. It is not hard to see why commentators are sceptical about whether the government is close to agreeing a deal, as it seems most of the deadlines during the Brexit process have been missed.
While the Brexit secretary seems to be hopeful a deal can be reached in the next three weeks, Michel Barnier's deputy, Sabine Weyand, is less so. Mimicking Theresa May in the 2017 UK general election Weyand commented, "nothing has changed, there are no new ideas." Despite this, the FT reports (£) that the EU is floating a new compromise agreement to the Irish backstop challenge, which might unlock the talks. Furthermore, there are other signs of progress, with the EU and UK also agreeing a tentative deal on a future relationship when it comes to financial services and data sharing.
But just as a deal seems to edge closer, the news that Arron Banks, the financer of Leave.EU, is being referred to the National Crime Agency over financial irregularities has led some arch-remainers to question the validity of the referendum result.
There's still a long way to go and at some point soon, the prime minister will have to upset either the Brexiteers, the DUP or the soft Brexit / remain elements in her party. The former Exiting the EU Secretary David Davis senses it will be the Brexiteers that are let down - he told the audience at an Institute for Economic Affairs (IEA) event that "terror will win" and that "the fear of no deal, I think - we haven't had a chance to talk about it much - but I think that's an irrational fear of no deal or a WTO [World Trade Organisation] deal."
The twists and turns of Brexit are not confined to Whitehall and Brussels, but now are spilling over into select committees. Immigration minister Caroline Nokes had a bruising time at the Home Affairs select committee after MPs questioned her on the government's plans for EU citizens post-Brexit.
Nokes stated that businesses would have to carry out more rigorous checks on EU citizens to prove that they are eligible to work in the UK. But when Yvette Cooper, chair of the Home Affairs select committee, pressed as to what these checks consisted of the minister didn't have an answer. Downing Street and the home secretary Sajid Javid contradicted Nokes' version of events, as it turns out that forcing employers to carry out these checks is not Government policy. Let us not forget that Amber Rudd had to resign as home secretary when she accidentally misled the Home Affairs select committee.
Given the importance of the Home Office and immigration to the whole Brexit process, and the fact that the UK only has 150 days before exit day, it is concerning that a government minister and a senior civil servant do not appear to be entirely on top of their brief. It probably also points to the enormous complexity of Brexit - there are so many issues left unresolved and so little time left to prepare and negotiate.
Sarah Jones, managing director, public affairs practice