EU Rejects Johnson's Demand to Scrap Backstop: Brexit Update

(Bloomberg) — Boris Johnson is chairing the first meeting of his cabinet after a cull of Theresa May’s ministers and the appointment of a team committed to delivering Brexit by Oct. 31.Key Developments:Boris Johnson chairs the first meeting of his new CabinetPrime minister will address House of Commons at about 11:30Must Read: Champagne and Magic Complete Johnson’s RebrandingRead More:The Great Brexit Purge: Johnson’s Cabinet CullJohnson Will Address No-Deal Planning (11:10 a.m.)Boris Johnson will address preparations for a no-deal split from the EU when he addresses Parliament later, Leader of the House Jacob Rees-Mogg told the House of Commons.“It’s jolly good news we’ve got an administration that’s committed to leaving the European Union,” Rees-Mogg said in answer to an MP’s question about no-deal planning. “Preparedness is of great importance, I think he might find there are some encouraging words coming from the prime minister a bit later.”Rees-Mogg: MPs Voted to Leave EU by Oct. 31 (10:53 a.m.)Jacob Rees-Mogg, the new leader of the House, argued Parliament has already given its approval to leaving the EU on Oct. 31, regardless of whether a deal has been reached with the EU. MPs have already passed laws putting the Brexit process in motion, he said.”With relation to leaving the European Union, this Parliament voted for the Withdrawal Act and said we would leave,” he said. “Parliament debated, Parliament decided, parliamentary democracy requires we deliver.”Brexiteer Baker Eyes Treasury Committee Chair (10.45 a.m.)Boris Johnson hasn’t so far found a job for Steve Baker, the deputy chairman of the pro-Brexit European Research Group and a man who coordinated opposition to Theresa May’s deal. Baker was an early backer of Johnson, giving him the Brexiteer stamp of approval.Baker may yet be appointed to a non-Cabinet ministerial position, but if he’s not, what would he like to do instead? This morning he said in a brief interview that he has his eye on the chairmanship of Parliament’s Treasury Committee, vacant now Nicky Morgan has become Culture Secretary.It’s one of Parliament’s most powerful committees, and would be a good pulpit from which Baker would be able to make life difficult for the government. And not just on Brexit. “It would allow me to pursue my other interest — monetary policy reform,” he said. Baker is an advocate of ending the days of fiat money creation.Rees-Mogg Doesn’t Rule Out Prorogation (10:45 a.m.)Jacob Rees- Mogg, the new leader of the House of Commons didn’t rule out suspending Parliament to force through Brexit.Asked about it in his weekly question and answer session, he told MPs: “The prime minister has said he views prorogation as an archaic mechanism and he doesn’t wish to see archaic mechanisms used. As I’m now bound by collective responsibility that’s now my view.”Swinson Urges Corbyn to Call No-Confidence Vote (10:05 a.m.)Jo Swinson, the newly elected leader of the Liberal Democrats, has written to Labour leader Jeremy Corbyn urging him to call a vote of no-confidence in Boris Johnson’s new government.“Boris Johnson does not hold a mandate from Parliament or the general public to be Prime Minister,” Swinson wrote. “His reckless refusal to rule out proroguing Parliament in order to crash the U.K. out of the EU without a deal demonstrates that he is not fit to lead this country.”She points out that Corbyn, as leader of the official opposition, is the only person in a position to call such a vote. “You must not sit back and allow this government to crash our country out of the EU,” she wrote.Labour has so far resisted calls for a no-confidence vote, saying the party will do so only when there is a good chance of success.Sunak: Govt Could Use EU Payment for Economy (8:45 a.m.)Chief Secretary to the Treasury Rishi Sunak suggested the government could spend the 39 billion-pound ($49 billion) financial settlement to stimulate the economy — depending on the outcome of negotiations with the European Union.“That will no doubt be a discussion for the future but the point is we won’t be writing a check on day one for 39 billion pounds,” Sunak told BBC Radio.It’s a position that risks angering the bloc because the agreed sum is a settlement of past and current liabilities — with a portion owed for ongoing projects. The bloc has repeatedly said the payment is a key component of the divorce settlement and not related to any future trade deal.Also asked how he expects the EU to respond to the tougher line taken by Johnson, Sunak predicted the bloc would negotiate. “They said they would never give us an extension until we passed the withdrawal agreement — they didn’t just give us one, they gave us a couple,” he said.There’s No Time For Doubt: Duncan Smith (7:50 a.m.)Former Tory leader Iain Duncan Smith, who was chairman of Johnson’s leadership campaign, said there’s not enough time before the new prime minister’s Oct. 31 Brexit deadline for there to be doubters in cabinet.“If you’ve got 100 days, you cannot have people who say ‘you know what, I’m not sure about this,’” Duncan Smith told BBC Radio 4.He said Amber Rudd and Nicky Morgan, regarded as more moderate voices on Brexit, will be able to have their say in cabinet discussions, contradicting Nick Boles’s claim (see 7:35 a.m.) that they will be “neutered.”Boles: New Cabinet Shows Hard Right Takeover (7:35 a.m.)Nick Boles, who sits in the House of Commons as an independent after quitting the Tory Party over the inflexibility of hardline Brexiteers, said Johnson’s reshuffle shows that the party has been taken over.“It’s very clarifying because what it establishes beyond all doubt is that the Conservative Party has been taken over top to bottom by the hard right,” Boles told BBC radio. “They’re turning themselves into the Brexit Party in order to hold off Nigel Farage.”“These are not normal center ground pragmatic politicians, these are ideologically motivated people from the hard right,” Boles said.Boles, who voted three times for Theresa May’s deal with the EU, said Nicky Morgan and Amber Rudd, who had previously opposed a no-deal split with the bloc, are “neutered captives” in the new cabinet. They have had to agree to be open to leaving without an agreement — and the damage that could cause to the U.K. economy — to get their jobs, he said.Earlier:The Great Purge: Johnson Culls Cabinet to Make His Brexit MarkWelcome to 10 Downing, Boris Johnson. You Have Some Work to DoChampagne and Magic Complete Johnson’s Rebranding as U.K. Leader\–With assistance from Alex Morales and Thomas Penny.To contact the reporters on this story: Kitty Donaldson in London at kdonaldson1@bloomberg.net;Tim Ross in London at tross54@bloomberg.net;Robert Hutton in London at rhutton1@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas Penny, Stuart BiggsFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

(Bloomberg) — Boris Johnson is chairing the first meeting of his cabinet after a cull of Theresa May’s ministers and the appointment of a team committed to delivering Brexit by Oct. 31.

Key Developments:

Boris Johnson chairs the first meeting of his new CabinetPrime minister will address House of Commons at about 11:30Must Read: Champagne and Magic Complete Johnson’s RebrandingRead More:The Great Brexit Purge: Johnson’s Cabinet Cull

Johnson Will Address No-Deal Planning (11:10 a.m.)

Boris Johnson will address preparations for a no-deal split from the EU when he addresses Parliament later, Leader of the House Jacob Rees-Mogg told the House of Commons.

“It’s jolly good news we’ve got an administration that’s committed to leaving the European Union,” Rees-Mogg said in answer to an MP’s question about no-deal planning. “Preparedness is of great importance, I think he might find there are some encouraging words coming from the prime minister a bit later.”

Rees-Mogg: MPs Voted to Leave EU by Oct. 31 (10:53 a.m.)

Jacob Rees-Mogg, the new leader of the House, argued Parliament has already given its approval to leaving the EU on Oct. 31, regardless of whether a deal has been reached with the EU. MPs have already passed laws putting the Brexit process in motion, he said.

“With relation to leaving the European Union, this Parliament voted for the Withdrawal Act and said we would leave,” he said. “Parliament debated, Parliament decided, parliamentary democracy requires we deliver.”

Brexiteer Baker Eyes Treasury Committee Chair (10.45 a.m.)

Boris Johnson hasn’t so far found a job for Steve Baker, the deputy chairman of the pro-Brexit European Research Group and a man who coordinated opposition to Theresa May’s deal. Baker was an early backer of Johnson, giving him the Brexiteer stamp of approval.

Baker may yet be appointed to a non-Cabinet ministerial position, but if he’s not, what would he like to do instead? This morning he said in a brief interview that he has his eye on the chairmanship of Parliament’s Treasury Committee, vacant now Nicky Morgan has become Culture Secretary.

It’s one of Parliament’s most powerful committees, and would be a good pulpit from which Baker would be able to make life difficult for the government. And not just on Brexit. “It would allow me to pursue my other interest — monetary policy reform,” he said. Baker is an advocate of ending the days of fiat money creation.

Rees-Mogg Doesn’t Rule Out Prorogation (10:45 a.m.)

Jacob Rees- Mogg, the new leader of the House of Commons didn’t rule out suspending Parliament to force through Brexit.

Asked about it in his weekly question and answer session, he told MPs: “The prime minister has said he views prorogation as an archaic mechanism and he doesn’t wish to see archaic mechanisms used. As I’m now bound by collective responsibility that’s now my view.”

Swinson Urges Corbyn to Call No-Confidence Vote (10:05 a.m.)

Jo Swinson, the newly elected leader of the Liberal Democrats, has written to Labour leader Jeremy Corbyn urging him to call a vote of no-confidence in Boris Johnson’s new government.

“Boris Johnson does not hold a mandate from Parliament or the general public to be Prime Minister,” Swinson wrote. “His reckless refusal to rule out proroguing Parliament in order to crash the U.K. out of the EU without a deal demonstrates that he is not fit to lead this country.”

She points out that Corbyn, as leader of the official opposition, is the only person in a position to call such a vote. “You must not sit back and allow this government to crash our country out of the EU,” she wrote.

Labour has so far resisted calls for a no-confidence vote, saying the party will do so only when there is a good chance of success.

Sunak: Govt Could Use EU Payment for Economy (8:45 a.m.)

Chief Secretary to the Treasury Rishi Sunak suggested the government could spend the 39 billion-pound ($49 billion) financial settlement to stimulate the economy — depending on the outcome of negotiations with the European Union.

“That will no doubt be a discussion for the future but the point is we won’t be writing a check on day one for 39 billion pounds,” Sunak told BBC Radio.

It’s a position that risks angering the bloc because the agreed sum is a settlement of past and current liabilities — with a portion owed for ongoing projects. The bloc has repeatedly said the payment is a key component of the divorce settlement and not related to any future trade deal.

Also asked how he expects the EU to respond to the tougher line taken by Johnson, Sunak predicted the bloc would negotiate. “They said they would never give us an extension until we passed the withdrawal agreement — they didn’t just give us one, they gave us a couple,” he said.

There’s No Time For Doubt: Duncan Smith (7:50 a.m.)

Former Tory leader Iain Duncan Smith, who was chairman of Johnson’s leadership campaign, said there’s not enough time before the new prime minister’s Oct. 31 Brexit deadline for there to be doubters in cabinet.

“If you’ve got 100 days, you cannot have people who say ‘you know what, I’m not sure about this,’” Duncan Smith told BBC Radio 4.

He said Amber Rudd and Nicky Morgan, regarded as more moderate voices on Brexit, will be able to have their say in cabinet discussions, contradicting Nick Boles’s claim (see 7:35 a.m.) that they will be “neutered.”

Boles: New Cabinet Shows Hard Right Takeover (7:35 a.m.)

Nick Boles, who sits in the House of Commons as an independent after quitting the Tory Party over the inflexibility of hardline Brexiteers, said Johnson’s reshuffle shows that the party has been taken over.

“It’s very clarifying because what it establishes beyond all doubt is that the Conservative Party has been taken over top to bottom by the hard right,” Boles told BBC radio. “They’re turning themselves into the Brexit Party in order to hold off Nigel Farage.”

“These are not normal center ground pragmatic politicians, these are ideologically motivated people from the hard right,” Boles said.

Boles, who voted three times for Theresa May’s deal with the EU, said Nicky Morgan and Amber Rudd, who had previously opposed a no-deal split with the bloc, are “neutered captives” in the new cabinet. They have had to agree to be open to leaving without an agreement — and the damage that could cause to the U.K. economy — to get their jobs, he said.

Earlier:

The Great Purge: Johnson Culls Cabinet to Make His Brexit MarkWelcome to 10 Downing, Boris Johnson. You Have Some Work to DoChampagne and Magic Complete Johnson’s Rebranding as U.K. Leader

–With assistance from Alex Morales and Thomas Penny.

To contact the reporters on this story: Kitty Donaldson in London at kdonaldson1@bloomberg.net;Tim Ross in London at tross54@bloomberg.net;Robert Hutton in London at rhutton1@bloomberg.net

To contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas Penny, Stuart Biggs

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