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Brexit news latest – No deal Brexit ‘worse than covid’ for UK economy, Bank of England governor warns as deadline looms

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MICHEL Barnier has warned that time is running out to secure a Brexit deal as negotiators prepare to start a final round of face-to-face talks on Thursday.

Writing on twitter, the EU's chief negotiator said: "Fundamental divergences still remain, but we are continuing to work hard for a deal."

It comes after Bank of England governor Andrew Bailey told the House of Commons Treasury Committee that the long-term impact of a no-deal Brexit would be greater than the impact of the coronavirus pandemic.

Follow our Brexit live blog for all the latest news and updates…

  • UK FACES RISK OF 'SYSTEMIC ECONOMIC CRISIS'

    Government ministers have privately admitted that the UK faces an increased likelihood of a "systemic economic crisis" as the Brexit transition period ends while the country is grappling with a second wave of coronavirus.

    A Cabinet Office briefing paper seen exclusively by the Guardian warns that the UK could face a "perfect storm" of disasters, including the prospect of a bad flu season and medical strains caused by Covid-19.

    “Winter 2020 could see a combination of severe flooding, pandemic influenza, a novel emerging infectious disease and coordinated industrial action, against a backdrop of the end of the [Brexit] transition period,” the paper warns.

    The paper, of September, details "reasonable worst case scenarios" across 20 areas of national life from oil and healthcare to travel and policing.

  • WILL BREXIT AFFECT MY SAVINGS?

    There is a chance that Brexit will have some impact on personal finances such as pensions and how much holidaymakers will have to splash on travel insurance.

    But saving providers tend to follow the Bank of England when it comes to setting interest rates, raising or lowering them as the base rate changes.

    Rates are virtually negligible on most accounts at just 0.1%. The Bank sets the rate to keep inflation low.

    Emergency base rates have been cut twice since March due to the pandemic and its effects on the economy.

    The rates were not cut because of Brexit uncertainty.

  • BREXIT AND ROAMING CHARGES

    Since June 2017, Brits have been to use their minutes, texts and data included in their mobile phone tariff while in the EU at no extra cost.

    What happens with roaming charges depends on what, if anything, is agreed between the UK and EU.

    The government announced in July that "the guarantee of free mobile phone roaming throughout the EU, Iceland, Liechtenstein and Norway will end" on January 1 2021.

    But, some good news for Brits as EE, O2, Three and Vodafone say they have no plans to start charging customers when in EU countries.

  • WILL BREXIT AFFECT MY PENSION?

    Your pension, or some part of it, is likely to be invested in the stock market.

    The financial markets hate uncertainty so if trade talks are stalling or a no trade deal Brexit is likely, then it will be reflected on the stock exchange.

    You have to remember that any losses can be short term - and in time, markets can recover.

    Some volatility could be good for younger workers as their monthly pension contributions can buy more investments when prices dip, providing the opportunity for bigger returns long-term.

  • WILL I PAY MORE FOR TRAVEL INSURANCE POST BREXIT?

    The Brexit transition period ends on December 31 meaning the UK's relationship with the EU will change.

    But how will Brexit affect consumers?

    It's possible that Brits will have to pay more for travel insurance as you won't be able to use your European Health Insurance Card for medical treatment.

    The Government currently has no plans to extend the scheme even in the event that a deal between the UK and EU is reached.

    More claims is likely to lead to higher costs for insurers.

  • GOLDMAN TO OPEN TRADING VENUE IN PARIS BECAUSE OF BREXIT

    Goldman Sachs is to open a trading venue as a result of Brexit as big banks ramp up their plans to protect clients.

    The Wall Street bank has already moved £46bn worth of assets out of the UK and into Germany because of Brexit.

    The UK is in a transition period until the end of the year, after which the City will be stripped of its EU passporting rights, which currently provide full access to EU markets.

    The US bank has previously warned that a “difficult” Brexit would negatively affect its investment plans in the UK.  

  • MOTOR INDUSTRY AT RISK OF £55 BILLION LOSS

    The UK's automotive industry has warned that failure to agree a Brexit deal will cost the sector up to £55billion by 2025.

    The Society of Motor Manufacturers and Traders have urged the government to "stretch every sinew" in the talks with the EU so an agreement can be reached which avoids tariffs, Mail Online reports.

    Trading under WTO rules would keep annual vehicle production "below one million units" consistently and see the price soar for customers, the SMMT warned.

    Currently, there are no tariffs on goods traded between the UK and the EU, but that arrangement is only in place until the Brexit transition period expires at the end of the year.

  • 'EU NEEDS TO MOVE TOO', SAYS GOVE

    The European Union must move too if there is to be a Brexit deal, Michael Gove told reporters today.

    The Cabinet minister hopes that the UK will be able to reach an agreement with Brussels as time ticks towards the end of the transition period at the end of the year.

    “I hope that we will be able to secure a good deal with the European Union,” he said.

    “The European Union needs to move as well and it needs to acknowledge that we voted to take back control and that’s the most important thing.”

  • RACING LEADERS STEP UP BREXIT PREPARATIONS

    Britain's racing leadership has stepped up its message to get the sport prepared for the end of the transition period.

    The Thoroughbred Industries Brexit Steering Group on Tuesday published more information on the likely changes to arrangements for the movement of both horses and people rather than wait for clarity from the negotiations.

    The group warned the sport's participants to avoid moving horses during the first two weeks of 2021, The Racing Post reports.

    There are fears that a no-deal will prevent the free movement of racehorses and breeding stock between the UK, Ireland and France.

    More than 25,000 thoroughbreds travel between the countries annually.

  • LORRY DRIVERS STUCK IN M20 QUEUES

    Lorry drivers were left waiting in miles of M20 queues as French authorities tested Channel Tunnel border controls they claimed will be in place if there is no Brexit agreement.

    Getlink, which operates the Channel Tunnel, said the queues were 'not representative' of a no-deal Brexit, as half of the available lanes were blocked off. 

    Highways England also said it had closed the entry and exit slip-roads at Junction 11 in Kent today due to the number of HGVs parked on the hard shoulder, report Mail Online.

    The delays were caused by French authorities 'testing the impact of EU and Schengen immigration controls' at the Eurotunnel terminal in Folkestone in the event of no deal. 

  • LABOUR MP QUESTIONS GOVERNMENT OVER BREXIT FESTIVAL

    The UK's "Festival of Brexit" is set to receive £29million in funding this week as part of the Chancellor's Spending Review which is due to take place tomorrow.

    But this hasn't sat well with Luke Pollard, Labour MP for Plymouth Sutton and Devonport.

    "The Government said they couldn't find £20million to feed their children over the school holidays, but they can find £29m for a festival of Brexit.

    "Something is very wrong about their priorities."

  • SIX MONTHS OF BREXIT ‘MAYHEM’ AHEAD IN 2021, SAY IRISH HAULAGE CHIEFS

    The Irish Road Haulage Association (IRHA) said the first six months of 2021 would be “terrible” for the Welsh port of Holyhead because the terminal hasn’t been properly prepared for the changes. 

    It is the UK’s second largest “roll-on roll-off” port after Dover, and carries around 1,200 lorries and trailers a day from north Wales to Ireland.

    Michael Gove, the minister in charge of planning, said last month that the UK was “increasingly well-prepared” for the end of the transition period.

  • MPS BACK CHANGES TO POST-BREXIT LEGAL LEGISLATION

    MPs have supported curbs to post-Brexit powers relating to international legal agreements.

    The Private International Law (Implementation of Agreements) Bill enables the UK to continue to participate in international agreements which provide ways for determining jurisdiction and enforcement in international disputes covering child custody and maintenance, plus other matters.

    Peers amended the Bill after expressing concerns that the Bill would give the Government the power to enact such agreements by using secondary legislation, known as statutory instruments.

    After MPs sent it back to the Lords, further changes were made by peers, including introducing a duty on ministers to consult before exercising the power and a five-year sunset clause, which can be renewed.

    MPs accepted these amendments without the need for a vote, thereby clearing the way for the Bill to become law.

  • BRUSSELS IN BID TO STOP BRITISH BANGERS AND BURGERS BEING SOLD TO NORTHERN IRELAND

    Eurocrats are insisting imports of chilled meat products from the UK will be banned after Brexit because of EU red tape.

    The devastating diktat, also covering burgers and mince, would include Northern Ireland under the terms of last year's divorce deal. 

    Boris Johnson is vowing to retaliate by stopping the same Irish goods from entering our market, which would hammer the country's farmers. 

    Dublin is now pleading with the EU Commission to show some common sense before it's too late. 

  • LONG QUEUES ON M20 CAUSED BY BREXIT BORDER CONTROL TESTS 

    Lorry drivers were left queuing along the M20 in Kent as Brexit border control tests were carried out at the Channel Tunnel.

    Highways England said it had closed the entry and exit slip road at Junction 11 on Tuesday due to the number of HGVs parked on the hard shoulder.

    It is understood the delays were caused by French authorities conducting tests on border checking procedures at the Eurotunnel terminal in Folkestone.

    A spokesman for Getlink, which operates the Channel Tunnel, said: "The backlog (of traffic) built up this morning during tests conducted by the authorities in preparation for Brexit."

    The spokesman said on Tuesday afternoon that traffic was now flowing "smoothly" through the terminal and services were operating as normal.

  • BREXIT DEAL SPECULATION ‘PREMATURE’, SAYS EXPERT

    Analyst Mujtaba Rahman says some of the speculation about a Brexit trade deal coming in the next few days – and how ratification will be handled – is way too premature.

    He thinks the two sides are “still too far apart” on matters, adding: “Qualitative jump still needed to bridge gaps.”

  • GOVERNMENT DEFEAT AS PEERS BACK STRONGER ENGAGEMENT WITH DEVOLVED NATIONS

    Peers have inflicted a further Government defeat in backing moves aimed at ensuring the devolved administrations are involved in the future operation of the UK internal market post-Brexit.

    The House of Lords supported by 319 votes to 242, majority 77, steps to force the British Government to seek the consent of Wales, Scotland and Northern Ireland before ministers are allowed to exercise powers contained in controversial legislation.

    The Labour-led change to the Internal Market Bill went further than the offer of consultation made by the Government.

    However, while it requires the Secretary of State to seek the agreement of the devolved nations before making regulations, it also makes provision to avoid the threat of a veto.

    If consent is not given within a month, the minister can press ahead but must publish a statement explaining why they have done so.

  • JPMORGAN: 80% CHANCE OF A BREXIT TRADE DEAL

    It comes as negotiators from Britain and the European Union try to clinch an accord before the end of the year.

    "Since the summer we have put the odds of a deal at about two-thirds, and no-deal at a third," the investment bank said in a note to clients today

    "Given the recent newsflow, the likelihood of a deal is clearly growing, and hence we shift our assessment to 80-20 in favour of a deal," it said.

  • UK CAR INDUSTRY SAYS FAILURE TO CLINCH BREXIT DEAL COULD COST £55.4BN BY 2025

    Britain's car industry body today called on Brexit negotiators to clinch a deal by the end of 2020, saying failure to do so could cost the sector £55.4 billion pounds ($74 billion) in tariffs by 2025 and undercut its ability to develop the next generation of zero-emission vehicles.

    The Society of Motor Manufacturers and Traders (SMMT) said a "no deal" Brexit would cut UK vehicle production by two million units over the next five years.

    "With scant time left for businesses to prepare for new trading terms, the sooner a deal is done and detailed communicated, the less harmful it will be for the sector and its workers," the SMMT said in a statement.

    Failure to do so could leave car manufacturers paying World Trade Organization (WTO) tariffs on parts and vehicles imported and exported into and out of Britain.

    The British car industry group said that WTO tariffs of up to £55.4 billion by 2025 would come on top of the immense cost to UK manufacturers of the coronavirus pandemic.

  • CONCERN OVER 'TWO-WAY BAN' ON MEAT PRODUCTS MOVING BETWEEN IRELAND AND UK

    Irish officials are working with the European Commission to avoid a potential "two-way ban" on meat products moving between Ireland and the UK.

    A change in the rules after Brexit means certain chilled and processed meat products - such as sausages and mince - would not be allowed to enter Northern Ireland from Great Britain.

    This is because Britain will be regarded as a third country by the EU from January 1, while Northern Ireland will continue to operate EU food safety rules under the protocol signed in October last year.

    In recent weeks, the UK has indicated it will implement a reciprocal ban on such products coming from Ireland, potentially disrupting the meat trade between the two islands.

    Ireland's Agriculture Minister Charlie McConalogue described the issue as "concerning" and said he is working with the European Commission to resolve it.

    He told RTE's Morning Ireland: "This is an issue that has emerged over the last number of weeks and something that officials in my own department have been working with European Commission officials to discuss.

  • FOOD FOR THOUGHT

    The Government continues to prepare for "a wide range of scenarios" in case the UK does not reach a trade deal with the EU, Foreign minister Wendy Morton has said.

    In response to Conservative MP Simon Baynes' (Clwyd South) question about how the Government is ensuring everyone is prepared for the end of the Brexit transition period, Ms Morton replied: "While it remains our intention and hope to reach an agreement with the EU, as a responsible Government we continue to make extensive preparations for a wide range of scenarios.

    "The FCDO is leading communication campaigns aimed at UK nationals living in the EU and UK travellers to the EU to help ensure they take the actions they need to be ready for the transition period."

    Conservative Tom Randall (Gedling) said China is displaying "contempt for freedom of democracy" in relation to Hong Kong, adding: "The time is now for stringent action, included targeted sanctions."

    Foreign Secretary Dominic Raab replied: "I totally share his objective and, of course, with the Magnitsky Sanctions, the key thing is to target those directly responsible.”

  • VACCINE WILL BOOST ECONOMY BUT NO-DEAL BREXIT THREATENS OUTLOOK, WARNS HASKEL

    A Bank of England interest rate setter has cheered "extremely positive" vaccine developments, but became the latest to warn a no-deal Brexit may pose a bigger long-term threat to Britain's economy.

    Jonathan Haskel - an external member of the Bank's nine-strong Monetary Policy Committee (MPC) - said recent news that highly effective coronavirus vaccines are soon to be rolled out will be a "very big help" in boosting confidence among firms and households.

    It follows Monday's announcement that the Oxford University-AstraZeneca vaccine was up to 90 per cent effective against Covid-19.

    But speaking to the PA news agency, he said it was too early to say if it will significantly improve the Bank's economic outlook for 2021, with UK prospects linked closely to the global economy and with a year-end Brexit deadline looming large.

  • BREXIT CHECKLIST LETTER IN LARGEST EVER GOVERNMENT MAIL-OUT

    Foriegn Office officials are organising one of the largest mail drops in history to Brit pensioners living in Europe ahead of the end of the transition period.

    Letters are being sent to 365,000 people living in places like the Costa del Sol, France and the Algarve and other parts of Europe.

    Officials will explain how to register for residency, healthcare and exchanging their driving licence, in “one of the largest-ever mail outs by the Government.”

    Foreign Secretary Dominic Raab said: “Protecting the rights of UK Nationals living across Europe is a priority for the Government.

    “That is why we are issuing one of the largest government mail-outs to ensure people know what actions they need to take wherever they live.

    Work and Pensions Secretary Thérèse Coffey added: “As we regain our political and economic independence we have been clear we want to protect citizens’ existing rights and help people prepare for the changes and opportunities ahead.“I’d encourage UK nationals living in the EU to visit GOV.UK and get ready for the end of the Transition Period."

  • EU INVITE BIDEN TO REBUILD TRANSATLANTIC TIES

    NATO Secretary General Jens Stoltenberg and European Council President Charles Michel, in phone calls with Biden, congratulated him on his election win and invited him to visit the military alliance's headquarters in Brussels, which is also the hub of the 27-nation EU.

    Stoltenberg thanked Biden "for being a long-standing supporter of NATO and the transatlantic relationship," according to a statement by the military alliance, while Michel "proposed to rebuild ... strong transatlantic" ties, his office said.

    As the EU grapples with the historic setback of Brexit, the bloc's statement also highlighted Biden's support for preserving peace and stability on the sensitive Irish border despite Britain leaving the EU.

    Biden has told London it must honour its 2020 divorce deal with the EU as it protects peace on the island of Ireland, or else there will be no U.S. trade deal for Britain.

    That comes as a welcome change of tone from Washington for the EU, which has often locked horns with President Donald Trump who has praised Brexit, pulled the United States out of a global climate pact and has been openly hostile to NATO, lambasting its European allies for spending too little on defence.

  • BREXIT BACKERS WANT CORPORATION TAX DITCHED

    The Independent Business Network called corporation tax a "disproportionate administrative burden" for companies.

    It said: "Without corporation tax, businesses will have more cash on their balance sheets, which can be deployed more effectively through greater investment in improving productivity, higher wages, lower consumer prices and higher dividends." 

    Its recommendations also include ensuring that sterling remains a "competitive currency".

    It is hoped the move would "help address the productivity crisis, while sparking a resurgent manufacturing base by allowing British industries to compete on the international stage". 

    The Brexit vote caused the pound to tumble from $1.49 against the dollar, although It recovered to $1.43 in the spring of 2018 and now stands at almost $1.33.

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