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Theresa May has hailed the EU draft agreement on post-Brexit relations as “right for the whole of the UK”, in a brief statement in Downing Street.

The political declaration – outlining how trade, security and other issues will work – has been “agreed in principle”, the European Council says.

London and Brussels have already agreed the draft terms of the UK’s exit from the EU on 29 March 2019.

The prime minister will make a statement to MPs at 15:00 GMT.

Mrs May, who has briefed her cabinet on the agreement in a conference call, said the agreement “delivers on the vote of the referendum”.

“The British people want this to be settled. They want a good deal that sets us on course for a brighter future. That deal is within our grasp and I am determined to deliver it,” she added.

Last week, the UK and the EU agreed a 585-page legally-binding withdrawal agreement, covering the UK’s £39bn “divorce bill”, citizens’ rights after Brexit and the thorny issue of the Northern Ireland “backstop” – how to avoid the need for a manned border on the island of Ireland.

The political declaration is a separate, far shorter document, setting out broad aspirations for the kind of relationship the UK and the EU will have after Brexit, and is not legally-binding. Some of the wording of it is non-committal and allows both sides to keep their options open.

What happens now?

  • Theresa May goes back to Brussels on Saturday for more talks with European Commission president Jean-Claude Juncker
  • Negotiators try to get an agreement with Spain over Gibraltar
  • EU leaders meet on Sunday to sign off on the withdrawal agreement and the political declaration
  • If that is agreed Mrs May starts the process of getting MPs to back the deal – most are currently against it
  • If MPs back the deal it then has to be ratified by the European Parliament
  • The UK leaves the EU on 29 March – and trade talks on the future relationship start

Tensions remain over some parts of the withdrawal agreement.

Spain’s prime minister, Pedro Sanchez, has said his government is “annoyed” that the divorce agreement does not specify that Gibraltar’s future must be decided directly by officials in Madrid and London – and France is understood to have sought amendments to the wording on fishing rights in UK waters.

Mrs May said she was “confident that on Sunday we will be able to agree a deal for the whole of the United Kingdom family including Gibraltar”.

What’s new in the declaration?

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  • Commitment to respect the indivisibility of the EU’s four freedoms – free movement of people, money, goods and services
  • A specific reference to the end of free movement in the UK
  • An aspiration to use technology to ensure there is no need for the Northern Ireland backstop to be used
  • A clear continuing role for the European Court of Justice in the interpretation of EU law – which is likely to anger Brexiteers

If all goes as planned, the UK and the EU will use the political declaration as the basis for a trade agreement, to be hammered out during a 21-month transition period that is due to kick-in after Brexit happens on 29 March, during which the UK will continue to be a member of the EU single market and customs union.

The draft document says: “The future relationship will be based on a balance of rights and obligations, taking into account the principles of each party.

“This balance must ensure the autonomy of the union’s decision-making and be consistent with the union’s principles, in particular with respect to the integrity of the single market and the customs union and the indivisibility of the four freedoms.

“It must also ensure the sovereignty of the United Kingdom and the protection of its internal market, while respecting the result of the 2016 referendum including with regard to the development of its independent trade policy and the ending of free movement of people between the Union and the United Kingdom.”

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Your guide to Brexit jargon

What has the response been?

Europe correspondent Kevin Connolly said the wording included nods to demands from all sides – with a reference to non-EU states not being able to enjoy the same benefits as member states but also a reference to ending the free movement to people to the UK and the UK pursuing an independent trade policy. He said there was an effort to use language which would make it easier for the prime minister to sell it in Westminster, while also recognising the concerns of EU member states.

But pro-Remain Tory MP Anna Soubry described it as a “syrup of warm sweet words about our future relationship” which would not match up to what Leave voters were promised, and was a “major step away” from the deal the UK currently has with the EU. And Eurosceptic Tory MP Mark Francois described it as a “fig leaf”, which was not legally binding and was “26 pages of political camouflage designed to take people’s eye off the withdrawal agreement and try to persuade them to vote it through”.

“It will not work,” he told BBC Radio 4’s World at One.

But Josh Hardie, deputy director-general of the business lobbying group the CBI, said: “It appears that we’re on the cusp of a much-needed agreement.

“The progress made is a credit to both sets of negotiators. But hard work lies ahead. A 20-page vision needs to become a 2000-page agreement that secures trade and jobs before the spectre of no deal can be put to rest.”

Commons leader Andrea Leadsom, one of a group of Brexiteer cabinet minister reported to have been pushing for changes to the withdrawal agreement, urged MPs to back the overall package.

Labour and the other UK opposition parties have said they will vote against the withdrawal agreement – as have Mrs May’s partners the Democratic Unionist Party, who she relies on to win key votes.

Dozens of her own Conservative MPs are also against it, arguing that it will keep the UK tied too closely to the EU and is not a “proper” Brexit.

Scottish Conservative MPs are also concerned that the declaration will not protect the interests of the UK fishing industry.

But the government insists the UK’s “red lines” on fishing have been protected, and the text acknowledges the UK will be “an independent coastal state” with the rights and responsibilities that entails.

A government source said the EU had wanted “existing reciprocal access to fishing waters and resources [to] be maintained” but this had been rejected.

The left-leaning IPPR think tank said the political declaration meant “Britain is heading for a hard Brexit—if it can solve the Irish border problem and avoid the backstop”.

“The language is warm but the message is brutal: if the UK aligns to EU regulations, trade will be easier. But no one should be in any doubt that this declaration rules out frictionless trade. And should the UK diverge its regulatory framework new barriers will be erected”, said the organisation’s director Tom Kibasi.

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