16 March 2017

Rutte’s VVD to be largest party despite gains for Wilders’ PVV and Greens in Dutch elections

Speaking as his centre-right VVD party looked set to emerge from yesterday’s elections as the largest group in the Dutch parliament, Mark Rutte, the Prime Minister of the Netherlands, said, “Our message to the Netherlands, that we will hold our course, and keep this country safe, stable and prosperous, got through. This was an evening when…the Netherlands said ‘Stop’ to the wrong sort of populism.” With 95% of votes counted, the VVD looked set to return 33 MPs, a loss of 10, with Geert Wilders’ Eurosceptic PVV party likely to finish second on 20 MPs, a gain of four, closely followed by the Christian Democrat CDA and liberal D66, both with 19 seats. The social democrat PvdA, formerly Rutte’s coalition partners, dropped from 38 to 9 MPs, and the GreenLeft gained ten from 4 to 14. Wilders commented, “We are not a party that has lost. We gained seats. That’s a result to be proud of … And Rutte is certainly not rid of me yet.” Turnout was high at 77%. Talks aimed at forming a coalition will now begin.

Source: The Guardian

David Davis says EU trade deal “eminently achievable” if Commission hears member states wishes

Secretary of State for Exiting the European Union David Davis told the House of Commons Exiting the EU Committee that there was “a growing determination to get a constructive outcome,” and that a trade deal with the EU was “eminently achievable because the attitude of the European states is one which will want a good long-term relationship,” but added that, “The issue is whether the member states’ voices make it through to the Commission.” Asked whether the economic impact of leaving the EU without a trade deal had been assessed, Davis said, “Any forecast you make depends on the mitigation you make, and therefore it would be rather otiose to do that forecast before we have concluded what mitigation is possible.” He added, “We will get quantification later on, but it is quite plain how it will work out. On the one hand, we have the aim of a good comprehensive free trade agreement. In the event we don’t get that or there is no conclusion, we will have a fairly extensive contingency plan, which is already under way. And we will have, whatever happens, a sharply improved access to the rest of the world off the back of a large number of free trade agreements which will be coming into effect shortly after we leave or some of them will be.” On the question of the UK’s EU financial assets and liabilities, Davis said, “Our stance is pretty straightforward we are a law-abiding nation, we believe in international systems of rules and we obey them. We have rights and obligations and we will insist on one and meet the other.” On the issue of the Irish border, Davis acknowledged that creating a new customs system “is not going to be easy, it is going to cost us money, a lot of work on technology, to put border controls in but without having border posts but that is what we intend to do.” He insisted that the Common Travel Area will apply and “what we will aim to do is pretty much identical to the 1949 Act, which gives effectively citizenship rights to the citizens of each country.”

Separately, Prime Minister Theresa May told the House of Commons at Prime Minister’s Questions that Scotland “will leave the EU either as a member of the United Kingdom or were it independent,” citing the ‘Barroso doctrine,’ which suggests any state seceding from an EU member state would not automatically retain EU membership, but would instead have to apply as a third country. Questioned on how Scotland was being represented in the government’s preparations to trigger Article 50, May said, “We have been in discussions with the Scottish Government and with the other devolved administrations about the interests they have…We have been one country for over 300 years. We have fought together, we have worked together, we have achieved together, and constitutional game-playing must not be allowed to break the deep bonds of our shared history and our future together.”

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National Insurance increase cancelled

The planned 2% increase in Class 4 National Insurance Contributions announced in the Budget last week has been cancelled. The Chancellor, Philip Hammond, told MPs, “By making this change today, we are listening to our colleagues and demonstrating our determination to fulfil both the letter and the spirit of our manifesto tax commitments,” adding, “There is a threat to the tax base that will have to be addressed over time.” Responding to questions about the government’s plans to review employment measures, Hammond said, “We’ll be looking at parental benefits and that’s the principal area where there is a discrepancy between what is available to self-employed and the employed.”

Meanwhile, The Times quotes a government source as saying, “No 10 said don’t do it, but Philip [Hammond] wouldn’t listen.”  A No 10 spokesperson has said that Prime Minister Theresa May has “full confidence” in the Chancellor.

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Bloomberg: EU may wait until June to start Brexit talks

Two EU officials have reportedly told Bloomberg that the EU-27 have set aside 20 June for a meeting of government ministers in Luxembourg to announce the opening of Brexit negotiations. While EU-27 leaders are expected to meet earlier to agree the framework for negotiations, talks between the UK and the EU will not begin until ministers approve a detailed negotiating mandate, drawn up by the European Commission. This would limit the amount of time Prime Minister Theresa May has to secure a deal before the Article 50 two year timeframe expires in spring 2019. Open Europe’s Pieter Cleppe is quoted in the Bloomberg article saying, “Time pressure is a very big issue.”

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UK unemployment rate falls to lowest level since 1975, while wage growth slows down

New figures released by the Office for National Statistics (ONS) yesterday show that the UK’s unemployment rate fell to 4.7% in the three months to January 2017 the lowest level on records since the three months to August 1975. The employment rate reached 74.6%, the highest level since comparable records began in 1971, while the number of economically inactive people that is, people out of work and not seeking employment fell by 34,000 compared to the three months to October 2016. However, the ONS also said that wage growth (not including bonuses) has slowed to 2.3% from 2.6% in the previous three-month period.

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Immigration minister says UK will not have Australian point-based immigration system post-Brexit but instead it will be “bespoke”

Minister of State for Immigration, Robert Goodwill, has said that the UK will have a “bespoke immigration system” post-Brexit. Goodwill rejected the idea that it might be based on the Australian points-based system saying, “There is no off-the-peg system that will work for us. Whatever is agreed will be a unique arrangement between the EU and the UK,” and rejected the adoption of a regional immigration system as proposed by the London Mayor Sadiq Khan and the Scottish National Party. He continued, “It may be different for different sectors. It may reflect shortages in our economy. But that is, sort of, speculation, which I think would be unwise to enter into ahead of the negotiations.” Goodwill insisted that the government’s commitment to reduce net migration to the tens of thousands “is a target we intend to deliver on.” However, he admitted that, “That’s not going to be done in the next two or three years.”

Separately, according to the Royal Institute of Chartered Surveyors (RICS) almost 200,000 construction jobs are at risk if access to the single market is lost because of Brexit. RICS head of UK policy, Jeremy Blackburn, said, “These figures reveal that the UK construction industry is currently dependent on thousands of EU workers. It is in all our interests that we make a success of Brexit, but a loss of access to the single market has the potential to slowly bring the UK’s GBP500 billion infrastructure pipeline to a standstill. That means that unless access to the single market is secured or alternative plans are put in place, we won’t be able to create the infrastructure needed to enable our cities to compete on a global stage.”

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Ireland complains of “dangerous competition” from EU cities to attract financial business

Reuters reports that the Irish minister in charge of promoting Dublin’s financial centre, Eoghan Murphy, has complained to the European Commission about a culture of “dangerous competition” among European financial capitals, with certain EU cities “being very aggressive in trying to win business.” Without naming any EU member states, he said, “They are offering a back door to the single market, without the requirement to have capital to back up their entities in the European Union.”

This comes as a Bank of America executive, Nikolaus Naerger, said at an event in Frankfurt, “Dublin is an emergency, default option that we have [for establishing a new base],” adding, “We are playing through all the scenarios. Nothing has been decided. Dublin is an option, just as Frankfurt or Amsterdam.”

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Erdoğan accuses the EU of fascism, as Turkish foreign minister threatens abandoning Turkey-EU readmission agreement

Turkish President Recep Tayyip Erdoğan has said, “The spirit of fascism is running wild on the streets of Europe…The Jews were treated the same in the past…Turkophobia is mounting. Islamophobia is mounting. They are even scared of migrants who take shelter there.” This comes as Turkey’s Foreign Minister, Mevlüt Çavuşoğlu, said, “We may cancel the [Turkey-EU] readmission agreement [Turkey agreed in 2014 to accept returned migrants who were not authorised to stay in the EU, in return for the EU easing visa requirements for Turkish citizens]. The EU has been wasting our time on the visa liberalisation issue. We are not applying the readmission agreement at the moment, and we are evaluating the refugee deal.”

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