Monday 16th October

We have grown accustomed to the smiling face of complacent David Davis as he assures us that progress is being made.  And Theresa May in her Florence speech was full of confidence that a deal would be not only forthcoming but excellent for Britain too.

Well of course that was all for the cameras.  The reality is somewhat different.  Chief negotiator Michel Barnier has described the talks as “Deadlock”.  But please, do not misunderstand.  These are only the very first element of the talks, and what should have been the easy bit.  Guaranteeing the rights of existing EU nationals in the UK and vice versa, the border between Eire and Northern Ireland (which everyone agrees should be transparent, yet no-one can tell us exactly how if we are not in the Single Market) and of course the “Divorce Bill”.  And it is of course this third element that is the real sticking point. Mrs. May says we will pay our legal responsibilities but puts no figure on it, though rumours abound that she would be happy with 20 billion.  Rumours are also rife that the EU wants substantially more.  And here is the real problem.  There are many in her own party who baulk at paying a single penny after we officially leave in 2019.  “They can go whistle” – as Boris says. The talks cannot move on to the far more crucial areas of trade and our future relationship until these three and, especially the money, are agreed.

So, Theresa is hopping hotfoot to Brussels for dinner with M. Barnier today.  She will probably come back waving a piece of paper ‘Chamberlain’ style saying it is all sorted.  However, it almost certainly won’t be.  There will be riots in the Tory party if she pays what the EU are asking.  And anyway, it may well be too late for the approval of the EU heads of government later this week.  They will insist on a formal return to the talks for more detail.  She may of course instead stonewall, preparing the way for a dramatic crash in the talks and what would seem to be her favoured option of ‘No Deal’.

Meanwhile the headline of City AM (a free paper in the City of London, and as business oriented as you can get) is that Manufacturers both in UK and EU are demanding am agreed transitional deal by the end of this year.  An almost impossible ask as we haven’t even started to talk about trade yet.  The manufacturers say they need this for plans after 2019.  In other words; they will have to start switching production out of Britain in 2018 if they do not know what will happen in 2019.  Thirteen banks are likewise making plans to move their headquarters out of London and to Dublin or Paris.

But, all of this talk of a transitional period is simply short-term.  What they, and all businesses are worried about is the shape of our trading with Europe after that.  And if that is not to their liking, then the brown stuff will certainly hit the newly installed Dyson Superfans…remember to order your Sou’Wester’s and wellies.