UK may fail to get trade deal with EU unless it agrees not to lower standards, says Barnier - Politics live

Just in case you haven’t had enough of Michel Barnier, the House of Lords European Union committee has now published the transcript of the meeting it had with Barnier, the EU’s chief Brexit negotiator, in Brussels on Wednesday last week. There are several good lines.

• Barnier said EU states could refuse to approve a trade deal with the UK unless the government gives assurances that it will not use Brexit to deregulate and lower standards. He said:

You talked about the risk of divergence. It is a risk, not a certainty. The repeal bill is meant to bring EU legislation into British laws, and that is very good and important, but what will happen D plus 10 or D plus 20? How will your law and your standards develop?

These are also questions for the other member states. The mechanics of this divergence should not lead to unfair competition, because if we do not answer this question - of course, you can help us to find solutions to this because you have so much expertise, skill and competence, and you can help us to have a level playing field - I can tell you that there will be major difficulties in obtaining ratification of any future agreement in all countries, because there will be campaigns against the negotiations. It will be said that Brussels is conducting negotiations with the UK to downgrade environmental and social standards, for example, which will lead to more tax competition. If that happens, everything is over. I do not want that. I want us to make progress.

• He said there would be an “explosion” of outrage across Europe if Britain refused to pay for EU budget commitments already agreed.

There are thousands of town halls, municipalities, businesses and universities that have undertaken projects on the basis of those undertakings and commitments. If we are to cut 15% or whatever—that is the UK share—there will be an explosion everywhere across the board. You cannot build a relationship in trust on a situation like that. That is why we have to solve this question calmly and objectively.

• He said Britain had to earn the “trust” of EU countries.

I am concerned, to be very frank with you, that the 27 Governments, the 27 national parliaments that are behind each Government, and the European Parliament, where I spend a lot of my time, need objective reasons to trust what we can do together in the future. If we do not find that trust and if we cannot find an agreement on settling the accounts, there will be no trust later. That is what I think. There will be no trust to do anything else later, and I want there to be trust later to do things together.

• He said Britain would not be allowed to reduce its “divorce bill” by delaying Brexit.

There is an important point here relating to when withdrawal actually occurs. It cannot be that the longer it takes the less you pay. This is not an insignificant point. If we are looking at the date of March 2019 or maybe 2020, commitments will have been made before this period going to 2021, 2022, 2023, and perhaps later, so this is what we have to sort out. The UK has lots of commitments and will have to pay them.

• He urged the Lords committee to carry out an inquiry into what leaving the EU with no deal would entail, so that people realise how serious it would be. He told the peers:

In the speech I gave last week that you referred to, I talked about the idea that I have heard from some ministers in the UK debate that it would be better to say “no deal” in some instances. I think we really need to explain what “no deal” would mean. So perhaps the House of Lords could explain exactly that. We really have to weigh up the consequences. It is certainly not the option I would choose.

Here is the statement Sir Vince Cable has issued following his election, unopposed, as the new Lib Dem leader. He said:

There is a huge gap in the centre of British politics and I intend to fill it. As the only party committed to staying in the single market and customs union, the Liberal Democrats are alone in fighting to protect our economy. It will soon become clear that the government can’t deliver the painless Brexit it promised. So, we need to prepare for an exit from Brexit.

Theresa May wants to take Britain back to the 1950s while Jeremy Corbyn wants to take Britain back to the 1970s. I will offer an optimistic, alternative agenda to power the country into the 2020s and beyond.

We have a government that can’t govern and an opposition that can’t oppose. Labour and the Conservatives have formed a grand coalition of chaos, driving through a hard Brexit which would deliver a massive blow to living standards.

Both parties have abandoned mainstream economics. I want to put economics back centre stage.

Under my leadership the Liberal Democrats will be at the centre of political life: a credible, effective party of national government.

We have doubled our membership and our new members have given the party enormous energy. I want to give leadership to that energy, hitting the headlines and putting our party at the centre of the national debate.

Theresa May is to take a three-week holiday, Downing Street has said.

It has just gone 4pm, which means the deadline has passed for people to enter the Lib Dem leadership contest.

There was no last-minute entrant, and Sir Vince Cable - the only candidate - has been named as the party’s new leader.

Gordon Brown, the former Labour prime minister, has said that around 2,000 Britons who were sent to Australia and other Commonwealth countries as child migrants and who were abused should be compensated. He gave evidence to the child abuse inquiry on the topic today and said that when he was prime minister in 2010 he apologised to the victims on behalf of the government. But now he thought the government should go further, he said.

Children were denied a childhood, an identity, a family and any sense of belonging. That violation of human rights led to the 2010 apology I made on behalf of the UK.

Many, some as young as three - and this was happening as recently as the 1970s - were sent abroad, often having been falsely told their parents were dead.

But, given the new evidence of sexual abuse, our apology told only half of the story.

The sheer scale of sexual abuse of British-born girls and boys could be worse than in the Savile scandal and further children’s homes outrages we are aware of ...

My apology seven years ago was for the gross inhumane violation of rights by forcibly removing children, depriving them of identity, family and any sense of belonging.

An unknown but clearly large number of these children were subjected to horrific assaults sometimes before, sometimes during but in the main after they left the UK.

Because successive governments failed in what I call their duty of care these 2,000 surviving migrants all need and deserve redress.

In the end it was relatively cordial. Despite reports earlier this week that lack of progress could lead to the Brexit talks being stalled, Michel Barnier, the EU’s chief Brexit negotiator, and David Davis, the Brexit secretary, both sounded reasonable and businesslike when they gave their press conference after the first full round of Brexit negotiations in Brussels. There was nothing alarmist or overly pessimistic in what they had to say. But they did not have anything especially positive to announce either, and the main takeaway was that the dividing lines are starting to look more obvious.

Davis sounded more upbeat, although, as my colleague Rafael Behr says, that may be because he has a domestic audience to placate. (See 12.57pm.) “Overall I’m encouraged by the progress we have made on understanding each other’s positions,” he said. Barnier sounded more phlegmatic. He repeatedly demanded clarification from the UK, particularly over what the UK will pay when it leaves (the “Brexit bill”, or “divorce bill”), and overall he sounded less inclined to compromise (stressing, at one point, how he was defending a negotiating position backed by 27 EU states).

Here are the main points.

• Barnier said Britain needed to clarify what it was willing to pay the EU when it left. Without clarification on this, the EU would not be able to open talks with the UK on a future trade deal he said. (That stage of the talks is due to start in the autumn, but the EU will only allow that if sufficient progress has been made on issues like the exit bill). Barnier said:

A clarification of the UK position is indispensable for us to negotiate and for us to make sufficient progress on this financial dossier, which is inseparable from the other withdrawal dossiers.

What we want - and we are working on this - is an orderly withdrawal for the United Kingdom, that’s decided. An orderly withdrawal means accounts must be settled.

We know that agreement will not be achieved through incremental steps. As soon as the UK is ready to clarify the nature of its commitments, we will be prepared to discuss this with the British negotiators.

• Davis said the UK, and the EU, would both have to compromise over the financial settlement the UK will have to pay. In his opening remarks he said:

On financial settlement we both recognise the importance of sorting out the obligations we have to one another, both legally and in a spirit of mutual cooperation. We had robust but constructive talks this week. There is a lot left to talk about, and further work before we can resolve this.

Ultimately getting to a solution will require flexibility from both sides. But, as Michel said, we should not expect incremental process in every round.

But, in the Q&A, Davis did not offer any fresh evidence of the government’s willingness to compromise. Asked if there would be a net flow of money from the UK to the EU, he said he did not recognise the phrase net flow. And, when he was asked if he was willing to be open with the public about the need to pay substantial sums to the EU, he just repeated the position set out in Theresa May’s Lancaster House speech, where she said that the UK would no longer pay enormous sums to the EU after Brexit.

Barnier also accepted the need for compromise at some point, but said that would come later. “I know one has to compromise in negotiations but we are not there yet,” he said.

• Barnier said there was a “fundamental” split between the EU and the UK over the rights of EU nationals, and whether these should be guaranteed by a European court. The EU wanted the European court of justice (ECJ) to adjudicate on these rights, he said in his opening remarks.

There does remain one fundamental divergence on the way in which such rights would be guaranteed and on several other points, for example, the rights of future family members or the exports of certain social benefits.

In the Q&A he explained why this was so important to Brussels.

This is not a political point we are making, it’s a legal one. Simply, if there is to be continuity of EU law, that has to be framed by case law of the court. Only the court can interpret EU law. It’s not a choice, it’s an obligation.

But, in response to a further question on this, Barnier also suggested that it might not have to be the ECJ adjudicating on this. He said European Economic Area countries like Norway accept EU law. “If you take the EEA, they have an arrangement that dovetails in with the ECJ,” he said. Barnier was referring to the Efta court, which MLex’s Matthew Holehouse describes in more detail here.

• Davis dismissed claims that he should have spent longer at the talks this week. He pointed out that he had to attend cabinet and that House of Commons, and that he had to oversee the work of his department preparing for Brexit. There were 98 British officials in Brussels engaged in the detail of the talks, he said.

• He dismissed claims that the cabinet was split over the impact of leaving the EU without a trade deal. Asked if he agreed with Liam Fox, the international trade secretary, or with Philip Hammond, the chancellor, on this issue (see 9.19am), he said there was no difference between their positions.

This is what journalists and commentators are saying about the Davis/Barnier press conference.

From the BBC’s Katya Adler

From the Guardian’s Jennifer Rankin

From Politico Europe’s Ryan Heath

From the Guardian’s Rafael Behr

From the Guardian’s Lisa O’Carroll

From the FT’s Alan Beattie

From Sky’s Beth Rigby

Here is the start of the Press Association story about the press conference.

Brussels and the UK have “fundamental” disagreements over citizens’ rights and there must be “clarification” on Britain’s position on a number of issues, the EU’s chief Brexit negotiator said.

After four days of negotiations, Michel Barnier said there had been some areas of agreement about how Britons living abroad and EU nationals living in the UK should be treated after Brexit.

But he said Brussels believed citizens’ rights should be backed by the Court of Justice of the European Union.

And he warned Britain all accounts “must be settled” when it quits the bloc.

He said: “There does remain one fundamental divergence on the way in which such rights would be guaranteed and on several other points, for example, the rights of future family members or the exports of certain social benefits.”

Brexit Secretary David Davis said talks had been “robust” but there was a lot to be “positive” about.

Further details about the UK’s willingness to pay a fee to Brussels will be required before talks can move on to a future trade deal, Barnier indicated.

But the UK is understood to think the EU team are being unclear on what they believe the legal obligations are over the divorce bill as well, with frustration on both sides.

Barnier said: “A clarification of the UK position is indispensable for us to negotiate and for us to make sufficient progress on this financial dossier, which is inseparable from the other withdrawal dossiers.

“What we want - and we are working on this - is an orderly withdrawal for the United Kingdom, that’s decided. An orderly withdrawal means accounts must be settled.

“We know that agreement will not be achieved through incremental steps. As soon as the UK is ready to clarify the nature of its commitments, we will be prepared to discuss this with the British negotiators.”

David Davis is speaking now. He thanks Barnier for his team’s “constructive” talks.

He says the UK will engage as a full member states. It will work constructively; it had 98 officials here. It will represent the whole of the UK. And the government will keep parliament involved.

He says the UK has put forward “a fair and serious offer” on citizens’ rights.

Today a joint paper is being published on the many areas of convergence, and on issues to be addressed in future rounds.

He says he agrees with Barnier about the need for shared certainty.

On financial settlement, both sides accept the need to address this. They have had “robust” discussions. Ultimately there will have to be “flexibility” on both sides.

• Davis says the UK and the EU will both have to compromise over the UK’s “divorce bill”.

Davis says they have conducted the talks at pace. He hopes they can continue like this.

Barnier says last week the UK accepted it had obligations to the EU after withdrawal. The EU had already said this.

Only with that recognition is it possible to start work on what those obligations are.

The EU set out its position in a paper on May 29.

He says the EU has provided a detailed legal analysis of its commitments.

Clarification of the UK position is “indispensable”, he says.

• Barnier says UK needs to clarify what it is willing to pay to leave EU.

He says they want an orderly withdrawal.

That agreement will not be achieved through incremental steps.

As soon as the UK is able to clarify its position, they will be able to move forward.

Barnier says this round of talks was about the two sides presenting their positions.

It was also about building trust, he says.

He says he wanted to indentify points on which the two sides agreed and disagreed. That was possible on the issues “on which there was a clear British position”.

• Barnier implies the Britain has not been clear what it wants on some issues.

Barnier says on citizens’ rights they are now moving forward in the same direction.

But there are still some disagreements, he implies.

He says EU citizens must know their rights. Any oversight should be from the European court of justice, he implies.

The David Davis/Michel Barnier press conference is about to start.

There is a live feed here.

In the Commons Karen Bradley, the culture secretary, is updating MPs on the bid by Rupert Murdoch’s 21st Century Fox for Sky.

She has just said that she is not in a position to give a final decision yet, but that she is still “minded” to refer the deal to the Competition and Markets Authority.

In a written statement about rail, Chris Grayling, the transport secretary, has announced that plans to electrify various rail lines - from Kettering to Sheffield and Nottingham, the Great Western route west of Cardiff and on the Lakes line between Windermere and Oxenholme - have been shelved. He says electrifying these lines is no longer necessary because there are alternative ways of improving the network. He says:

Technology is advancing quickly, and this government is committed to using the best available technologies to improve each part of the network. New bi-mode train technology offers seamless transfer from diesel power to electric that is undetectable to passengers. The industry is also developing alternative fuel trains, using battery and hydrogen power. This means that we no longer need to electrify every line to achieve the same significant improvements to journeys, and we will only electrify lines where it delivers a genuine benefit to passengers.

These new technologies mean that we can improve journeys for passengers on the Great Western Main line in South Wales, the Midland Main line, and on the Lakes line between Windermere and Oxenholme sooner than expected with state of the art trains, instead of carrying out disruptive electrification works along the whole of these routes.

The David Davis/Michel Barnier press conference has now been scheduled for 11.15am UK time.

That means the two men will be able to enjoy the sparkling English wine available over lunch. (See 9.40am.) Originally the press conference was intended to be postprandial, which would have discouraged quaffing.

It is an important day for Brexit. The first proper round of Brexit talks end this afternoon, and David Davis, the Brexit secretary, and Michel Barnier, the EU’s chief Brexit negotiator, are due to give a press conference where they will reveal what sort of progress they have been making.

And Liam Fox, the international trade secretary and another of the cabinet’s “three Brexiteers”, is out and about. He is giving a speech in Geneva, and was on the Today programme earlier. He was asked if he agreed with Philip Hammond, the chancellor, that leaving the EU with no deal would be “a very, very bad outcome”. Fox’s interpretation was slightly different. He said:

Well, we don’t want to have no deal. It is much better that we have a deal than no deal. We can, of course, survive with no deal, and we have to go into a negotiation with those on the other side knowing that that is what we think.

(Others think Hammond’s take on the impact of leaving without a deal is more realistic. As my colleague Heather Stewart writes, an academic report out today suggests leaving with no deal would spawn “a political mess, a legal morass and an economic disaster”.)

But Fox, who is seen as one of the most hardline leavers in cabinet, also told the programme that he was relaxed about the prospect of there being a transitional period.

If we are to have an implementation phase between leaving the European Union and our final settlement, I don’t have a problem with that. But I do think we have to leave the European Union first of all to keep faith with the voters who instructed us to do that.

(For some reason that is not entirely clear, leavers dislike the phrase “transitional period” and prefer to talk about “implementation”. Even though the two phrases are used to mean the same thing, Brexiteers suspect “transition” conveys less finality, as if leaving the EU will not have fully happened. The fact that Theresa May always talks about “implementation”, not “transition”, shows how firmly she now identifies with the “harder” rather than “softer” Brexit camp.)

When asked if the transitional deal could involve the UK staying in the single market or the customs unions for a period, Fox argued that leaving the EU would automatically take the UK out of the single market and the customs union. Yesterday, when asked the same question, Theresa May was marginally more non-committal. She phrased a reply at PMQs in such a way as to suggest that some sort of fudge was a possibility.

Later Michael Gove, the environment secretary, will also be speaking; he is taking questions in the Commons. He is not officially one of the three Brexiteers - the term was coined when Theresa May formed her first cabinet last summer, and he wasn’t in it - but he and Boris Johnson, the foreign secretary, effectively co-led the Vote Leave campaign.

Here is the agenda for the day.

9.30am: Michael Gove, the environment secretary, takes questions in the Commons.

9.45am: Jo Johnson, the universities minister, gives a speech on higher education reform.

10.40am: Jeremy Corbyn visits Royal Stoke Hospital. Later he will visit a school in Telford, and hold a rally in the town at 3.50pm, as part of his tour of marginal seats. The Tory Lucy Allan won Telford with a majority of 720 over Labour.

10.45am: Liam Fox, the international trade secretary, gives a speech in Geneva on Brexit and the global economy.

1.30pm: David Davis, the Brexit secretary, holds a press conference with Michel Barnier, the EU’s chief Brexit negotiator, at the end of this week’s round of Brexit talks.

3pm: Theresa May meets business leaders to discuss Brexit at Number 10.

4pm: Sir Vince Cable is expected to be confirmed as the new Lib Dem leader. Nominations for the leadership close at 4pm, and at the moment Cable is the only candidate and none of the other 11 Lib Dem MPs has expressed any interest in standing.

As usual, I will be covering breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web. I plan to publish a summary at lunchtime and another in the afternoon.

You can read all today’s Guardian politics stories here.

If you want to follow me or contact me on Twitter, I’m on @AndrewSparrow.

I try to monitor the comments BTL but normally I find it impossible to read them all. If you have a direct question, do include “Andrew” in it somewhere and I’m more likely to find it. I do try to answer direct questions, although sometimes I miss them or don’t have time. Alternatively you could post a question to me on Twitter.