Brexiteer customs plan 'would hurt thousands of companies', Treasury warns

Written by Matt Foster on 10 May 2018 in News

Leaked Treasury analysis warns that the 'maximum facilitation' plan would shave 1.8 per cent off UK GDP in the long-term

Boris Johnson  - Yui Mok/PA Wire

The post-Brexit customs plan being pushed by Boris Johnson and David Davis would damage hundreds of thousands of companies, ministers have been told.

The leak of details about a damning Treasury report is the latest salvo in the bitter row between Theresa May's top ministers over future customs ties with the European Union.

Johnson this week dismissed the Prime Minister's preferred option - a 'customs partnership' - as "crazy", earning himself a slapdown from Number 10.

Meanwhile, there were reports Brexit Secretary Davis was prepared to storm out of the Cabinet if the Prime Minister did not drop the plan in favour of the so-called 'maximum facilitation' model championed by Brexiteers.

But BuzzFeed News reports that ministers have been briefed on the potential economic impacts of the 'max fac' plan - and warned that 145,000 companies that rely on trading with the EU would be hit by new barriers to selling products there.

The assessment, prepared by the Treasury, also warns that the Brexiteers' favoured option - which relies on technological fixes to keep customs friction to a minimum - would leave the UK economy 1.8 per cent worse off in the long run.

According to the website, just 40 people in government have been given access to the sensitive presentation, which was shown to the Cabinet Brexit sub-committee last week.

The Prime Minister on Wednesday insisted that both options remained under consideration despite the war Cabinet last week siding against the partnership plan, which would keep much closer customs ties with the EU and see the UK collect tariffs on behalf of Brussels.

"Questions have been raised about both those options and further work continues," May told MPs.

Boris Johnson meanwhile insisted his outspoken intervention was "completely in conformity with government policy" - but only because the Government still does not have a policy on the issue.

The Sun reports today that May is considering making a public intervention on the issue next week in a bid to break the deadlock, while Number 10 is said to be lobbying wavering ministers, including Defence Secretary Gavin Williamson, to fall in line behind its favoured proposal.

One eurosceptic source told The Telegraph: "Number 10 are panicked and there is a fear she will try to bully one of the ministers into changing position and supporting the PM’s unworkable customs plan but everyone knows that would be career suicide."

Despite the furious row, the EU has reacted coolly to both plans being thrashed out by ministers. One Brussels source told BuzzFeed it was "interesting to see so much political capital spent on this".

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