‘No lose situation’ Tory MP says UK will STILL be better off without EU free trade deal
A senior Tory MP has claimed Britain is in a “no lose situation” ahead of Brexit talks with the UK emerging “better off” even if the EU blocks a free trade deal.
Former trade and industry secretary Peter Lilley warned Theresa May not to make “the best the enemy of the good” with just weeks left before the Prime Minister is due to begin divorce talks with Brussels.
Mr Lilley, a leading Leave campaigner, insisted if the UK is told to trade with the EU under World Trade Organisation (WTO) rules - rather than current free trade terms - as a form of punishment for the Brexit vote, the British economy would still continue to thrive.
The Hitchin and Harpenden MP claimed the only danger from Brexit talks would be a long period of delay and “damaging uncertainty” as the EU fusses over whether to grant the UK a free trade deal or not.
But Mr Lilley told the Government the wording of Article 50 of the Lisbon Treaty, the legal mechanism for quitting the EU, hands Britain “a strong lever to insist on early consideration of our future trading arrangements” before practical elements of the UK’s divorce - such as pensions payments for EU officials - are discussed.
In an article for the BrexitCentral website, Mr Lilley wrote: “Timing will be as important as substance in our negotiations. So we should begin by insisting that the negotiations respect the need to reach agreement on at least the outline of the framework for our future trading relationship before we can get down to who owns the house and who pays the mortgage.”
The Conservative backbencher described “the only two realistic options” for Brexit as continuing current free trade terms between the UK and EU or to trade on the basis of Most Favoured Nation tariffs and non-discrimination under WTO rules.
Outlining how EU bosses may find a “political need to punish Britain” for Brexit to “discourage others from following our example”, Mr Lilley said WTO trading terms “will cause the EU far more pain than it will cause the UK” but Brussels chiefs “may reason that it is worthwhile as a deterrent”.
The Tory MP added a post-Brexit free trade deal for the UK could also be derailed by a small number of EU member states or the European Parliament.
But relying on WTO rules “would still mean the UK is better off than we are at present”, Mr Lilley claimed.
He said: “Our net contribution to the EU is almost twice the tariff we would pay on our exports to the EU. Moreover, the Treasury would collect £12.3 billion in tariffs on imports from the EU whereas our exporters would pay only £6.5 billion tariffs to continental governments.
“So we could compensate any exporters for whom the 15 per cent improvement in competitiveness thanks to the exchange rate movement over the last year is insufficient, and still have billions to cut general taxation.
“And we can do trade and service deals with the huge, fast-growing but protected markets of Asia, Africa and Latin America.
“The wording of Article 50 gives powerful support for speeding up the process of leaving. We are in a no lose situation. Bring it on!”
The Prime Minister is set to reveal her Brexit plans in a major speech tomorrow with Mrs May expected to tell the EU she is ready to take Britain out of the bloc’s Single Market and Customs Union in order to return control to the UK’s borders, end the power of EU judges and sign free trade deals around the world.