Gavin Williamson under pressure to back May’s customs plan, Brexiters fear
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Gavin Williamson under pressure to back May’s customs plan, Brexiters fear

Pro-Brexit ministers fear Downing Street will try to pick off the defence secretary, Gavin Williamson, in the coming days – to break the cabinet deadlock and secure a majority for Theresa May’s favoured customs plan.

A two-and-a-half-hour meeting of the prime minister’s Brexit subcommittee ended without agreement on Wednesday, after the home secretary, Sajid Javid, sided with hardline Brexiters to reject a new customs partnership.

Williamson, who was rapidly promoted from chief whip to defence secretary, was the least vocal of those expressing doubts about the customs partnership on Wednesday. “They’ll call him in and try to promise him something; they’ll ask him what his price is,” said one Whitehall source.

The customs partnership, favoured by Downing Street, would see Britain collect tariffs on the EU’s behalf. Brexiters fear it would be bureaucratic for businesses and could limit the UK’s capacity to diverge from EU rules in future.

But its backers, who include the chancellor, Philip Hammond, and the business secretary, Greg Clark, believe it is the only plan that has a chance of avoiding a hard border in Ireland.

EU members (plus Turkey, Andorra, Monaco and San Marino) trade without customs duties, taxes or tariffs between themselves, and charge the same tariffs on imports from outside the EU. Customs union members cannot negotiate their own trade deals outside the EU, which is why leaving it – while hopefully negotiating a bespoke arrangement – has been one of the government’s Brexit goals. See our full Brexit phrasebook.

Pro-Brexit ministers prefer the alternative of maximum facilitation, or “max fac”, in which technology would be used to minimise cumbersome border checks. Brussels has rejected both plans as unworkable in their present form.

The government first outlined the two proposals last August, but the prime minister has yet to secure the backing of her cabinet colleagues for one plan. The resignation of ardent remainer Amber Rudd has left the Brexit inner cabinet deadlocked.

No vote was taken on Wednesday, but insiders said six of the 11 members spoke against the customs partnership plan. The chief whip, Julian Smith, attends the meetings, but Downing Street said on Thursday he was there in a “non-voting capacity”.

Jacob Rees-Mogg’s powerful backbench European Research Group, which sent the prime minister a 30-page report opposing her preferred plan, believes it has Williamson’s support. Rees-Mogg has called the customs partnership proposal “cretinous”.

The defence secretary used a speech at the Churchill War Rooms earlier this week to argue that “in a post-Brexit world, our only limit will be our imagination”.

Asked about support for the customs partnership, an ally of Williamson said: “Gavin will look at the options and do what he believes is the right thing for Britain.”

The Brexit secretary, David Davis, told MPs on Thursday that both the government’s two options remained on the table. “Both of these approaches have merits and virtues, both have some drawbacks and that’s why we’re taking our time over the discussion on this,” he said.

Whitehall officials are hastily working on refining both plans, despite the fact that one was rejected by May’s Brexit subcommittee.

Davis has told allies he hopes to find a way through the cabinet impasse in the next week – though he doesn’t yet know how.

The chancellor and business secretary have urged their colleagues to reach a resolution as soon as possible, or risk businesses losing confidence in being able to trade freely with the EU after Brexit.

Downing Street sources acknowledged the “urgency” of reaching a conclusion about which approach the government will seek to negotiate with Brussels.

Answering questions from MPs, Davis refused to set a deadline for choosing one of the two options. “It’s frankly incredibly important that we get this right, not just for trade but for the extremely sensitive issue of maintaining the peace process in Northern Ireland,” he told the Commons. “I don’t undertake to put an artificial deadline on something as important as that.”

Privately, Davis backs the max fac option, though he has loyally kept both plans alive in public. He told MPs the customs partnership was “a brand new idea: it’s never been tested anywhere in the world”.

The prime minister’s spokesman sought to play down the significance of Wednesday’s deadlock. “There’s an ongoing process of putting together the plans that will allow us to leave the EU in the smoothest possible way,” he said.

Davis also reiterated the government’s commitment to leaving the customs union, a policy for which it is unclear whether May could command a majority in the Commons.

Peers have inflicted 10 defeats on the government’s key piece of Brexit legislation, the EU withdrawal bill, passing amendments including one urging May to pursue a policy of remaining in a customs union.

Continued membership of the current customs union would allow tariff-free trade with EU countries, but would require the UK government to levy tariffs on goods from outside the EU and would prevent the UK from negotiating independent trade deals.

Several Conservative backbenchers, including Anna Soubry and Dominic Grieve, have made clear that they are prepared to back amendments to forthcoming legislation on customs and trade, to try to force the prime minister to reopen the issue.

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