It's being reported that the government is linking the extra money agreed on Monday with the EU committing to move on to trade talks (HERE). If true this is a spectacular misreading of the position we're in. The PM and her Brexit Committee, at their first meeting this week nearly eighteen months after the vote, still seem to think the UK has a strong hand. She should stop listening to the loony brextremists.
It actually gets worse with Reuters now reporting (HERE) that we will only reveal the amount we are prepared to pay when Brussels commits to starting phase II. It looks like we're doing the dance of the seven veils with the money. This is utterly ridiculous and makes us look even more stupid than we do now. The clock is ticking down but we appear oblivious to it.
The EU regard the payment of £50- £60 billion as simply the UK paying up the money we have already committed to twice. We committed to it once when we approved the multi annual financial framework in 2014 and secondly during Mrs Mrs May's Florence speech this year when she confirmed we would honour our commitments. So not only have we committed to pay it twice we now want to spend it twice.
Saying the money is for ensuring we get trade talks underway and a good deal at the end of them is a bit like wanting to spend the money for a second time. It is owed for projects already committed to and can't now be used as an exchange for something else.
This would apply in any case, regardless of the fact the EU hold nearly all the cards in the negotiation.
We must get a deal, at the very least a transition deal. Those calling for her to walk away cannot really have thought this through. The economy would probably collapse, manufacturing industry - especially those operating under EU wide approval schemes like cars, aerospace and chemicals - would be badly hit. Flights would be grounded and food shortages would be widespread. It is unthinkable, for any government, and this is why it will not happen. Even threatening it is risible.
The EU will not accept any linkage. And they will not accept the £40 billion as a final figure either. More than that, they won't move on trade until there is a firm basis for avoiding a hard border in Ireland.
David Davis says nothing is agreed until everything is agreed, assuming that we will avoid paying unless we get a good trade deal. But I don't believe this will happen. The trade deal won't be agreed for years and the withdrawal treaty, with the money embedded in it, will be settled and in force well before then.
Watching Mrs May and her cabinet against the EU is like watching children negotiating with adults. They have earnest conversations in a little huddle, send one of their number to make a pathetic offer only to return disappointed for another huddle. They are desperate to get their hands on the EU's goodies and this is obvious in everything they say and do. And paradoxically, each time they make a small concession the weakness of their position becomes more and more obvious.
In December they either have to walk away and suffer a massive electoral backlash as companies like Airbus announce they are winding UK operations down (HERE) or admit they have weak hand that they are playing badly. The time for bluffing will finally be over.
