UK seeks Brexit benefits as promised ‘freedoms’ fade away

(Bloomberg) — Rishi Sunak faces another sensitive Brexit decision after he was asked by senior public officials to delay a planned “bonfire” of legislation dating back to the UK’s accession to the European Union.

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Officials’ request to push the current 2023 deadline to remove some 4,000 EU laws from Britain’s law books by three years is a headache for the prime minister, who said over the summer that the legislation could be repealed or reviewed within 100 days.

If the premier gives in to the demands of his officials – who say the task simply cannot be done in such short order – he risks alienating Brexiteers into the ruling Conservatives like Jacob Rees-Mogg, for whom destroying legislation is a demand. who has achieved a totemic status.

For the prime minister, a Brexiteer who has an uneasy relationship with his Leave-voting right-wing party, he risks throwing more weight behind the argument most Conservatives don’t want to admit: that the clear benefits of Brexit seem hard to find.

This week’s data shows immigration hit a record high in the first year of Britain’s post-Brexit regime, despite referendum pledges that EU divorce would allow Britain to regain control of its borders and reduce numbers. The US trade deal once touted by former Prime Minister Boris Johnson as a big Brexit prize is nowhere in sight, and Sunak didn’t even bother to mention it in a meeting with the US last week. President Joe Biden at the G-20 summit in Indonesia.

Do you like Switzerland more?

And Britain remains at odds with the EU on implementing the Johnson-brokered deal because of the extra burdens it imposes on trade between Northern Ireland and the rest of the UK.

With Brexit resulting in increased red tape for businesses trading with the bloc, The Sunday Times reported that the government was seeking closer trading ties with the EU similar to the bloc’s relationship with Switzerland.

Both Sunak and Chancellor of the Exchequer Jeremy Hunt were forced to deny it, despite several senior government officials confirming to Bloomberg that Hunt had spoken privately to this effect.

There is little chance of the UK government renegotiating Johnson’s Brexit deal before the next election in two years’ time, as it remains a politically toxic issue. Re-entry to the EU is off the cards for the foreseeable future, and even a Swiss-style relationship crosses multiple red lines for Brexite supporters, including contributions to the EU budget, the need to follow some of its rules, and the acceptance of the free movement of workers .

Immigration surge

Evidence in recent days casts doubt on whether the Sunak government really believes it can deliver some of the supposed “freedoms” that Brexite advocates say would become possible by leaving the EU.

Migration is a case in point. While Home Secretary Suella Braverman speaks harshly of people crossing the Channel in small boats, the country’s new border controls have allowed net migration to reach 504,000 in the year to June, the highest figure on record. according to data from the Office for National Statistics Thursday.

Sunak’s spokesman Max Blain insisted the prime minister was “fully committed to reducing overall numbers”, although given the current labor shortage, it was unclear how and when the government intends this to happen.

Migration control was one of the key factors behind the Brexit vote, but Blain said the UK was still “not really in control” of its borders as illegal migration across the Channel persisted, remarks suggesting that the pledge of the Leave campaign has not been fulfilled six years after the referendum.

The Brexiteer vision of a low-tax, deregulated UK City of London has also been challenged by the Sunak government.

Financial services

The Treasury on Wednesday nixed a plan to give politicians leverage over financial regulators. The plan for so-called ‘call-in’ powers to be added to the UK’s post-Brexit framework legislation for banks, insurers and asset managers had sparked controversy.

Proponents argued it would give UK lawmakers further democratic scrutiny of regulators now that the UK has left the EU. But critics, including the heads of prudential and consumer regulators, said it threatened to undermine their independence and damage the UK’s reputation.

Hunt also said he asked the Treasury to examine how much money the government could raise by taxing wealthy foreigners who enjoy so-called non-dom status.

Meanwhile, the EU continued to undermine the preeminence of British financial markets by requiring derivatives traders to use accounts at bloc clearing houses for some transactions. The proposed reorganization – first reported by the Financial Times – aims to reduce the EU’s reliance on the UK’s financial services sector post-Brexit. The demands would apply to derivatives and could include credit swaps and futures.

Asked to name the benefits of Brexit this week, government spokespeople responded by arguing that there is potential for the UK to innovate in areas such as gene editing and life sciences.

Speaking in the Commons on Thursday, veteran Brexiteer and Conservative backbencher Peter Bone insisted he was happy that the free movement of people was over and that the UK had sovereignty over its own laws. He asked for a debate in Parliament entitled: “Brexit: a resounding success. There’s no going back.”

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