ConservativeHome: Why we must all now ready ourselves for no deal – and WTO terms

By any measure, the Prime Minister’s speech at the Mansion House last Friday was a remarkable achievement. In my book, it was the best she has made, better even than Lancaster House last year. A measure of its strength was that it was welcomed from across the spectrum of Conservative opinion, receiving praise from both Jacob Rees-Mogg and Nicky Morgan.

The speech was notable for its realistic appraisal of the negotiating challenge that the UK faces in securing the sort of “deep and comprehensive” free trade agreement it seeks with the EU, whilst striking the optimistic tone that many Brexiteers feel has hitherto been absent from Government messaging on the post-withdrawal future.

The Prime Minister was clear that the UK will leave both the Single Market and the Customs Union and cease to be subject to the jurisdiction of the European Court of Justice, all essential elements of the restoration of parliamentary sovereignty. At the same time, she acknowledged that compromises will have to be made if a trade deal is to be secured. Access to the Single Market would necessarily be less extensive than presently enjoyed. The UK would probably align many of its regulatory standards to those of the EU, seek associate membership of some EU agencies, and be prepared to make a financial contribution to their running costs.

The speech went into considerable detail about alternatives to the Customs Union, the first being a “customs partnership”, under which the UK would mirror EU duties for goods ultimately intended for the EU market, and the second a streamlined arrangement relying heavily on technology. Refreshingly, there was an acknowledgement that a fudge might be necessary for SME trade between Northern Ireland and the Republic, allowing smaller companies to operate as they do at present, with no further restrictions.

The Prime Minister was keen to point out the strengths that the UK would bring to any future trade relationship. The British medicines regulator currently assesses more new medicines than any other member state. The UK provides around 30 per cent of the broadcast channels available in the EU; and UK-located banks provided more than £1.1 trillion of lending to the rest of the EU in 2015 alone. She made clear that looking only at precedent when negotiating the new relationship would inflict injury on both parties. We need to be imaginative, and look at new solutions.

It was an intensely British speech, full of pragmatic common sense. It deserved the approval it has attracted from across the parliamentary party. To that extent, it was a success, for which the Prime Minister deserves the fullest praise.

The question remains whether the second audience to which it was addressed will have reacted as warmly to the speech. The Prime Minister went out of her way to say that she “understood the EU’s principles”. I have no doubt that she does, and will therefore know just how big a sell it will be to convert the speech’s proposals into an agreement.

To read David Jones’s piece for ConservativeHome in full, click here.

sign up to our Newsletter