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May faces cabinet showdown over Brexit deal

By Caoimhe Toman

Date: Wednesday 14 Nov 2018

LONDON (ShareCast) - (Sharecast News) - Prime Minister Theresa May faces a cabinet showdown on Wednesday when she will ask ministers to sign off a Brexit deal struck with the EU, despite strident opposition to the terms from Brexiters and in Northern Ireland.
Members of the cabinet were briefed on the plan on Tuesday night as May met several ministers to try and sell the agreement on the future relationship with the EU, ahead of a full cabinet meeting on Wednesday at 1400 GMT.

Cabinet ministers face increasing pressure to reject the deal and not "surrender to EU terms" from the 40-plus MPs in the Pro-Brexit European Research Group and Northern Ireland's Democratic Unionist Party party, which has propped up May's government in parliament since last year.

The home secretary Sajid Javid is said to have taken a hardline stance on Tuesday night and Michael Gove was said to be "closer to the edge" than previously thought, generating concerns of resignation of ministers at this crucial time.

"It is a failure of the government's negotiating position, it is a failure to deliver on Brexit, and it is potentially dividing up the United Kingdom," Conservative lawmaker Jacob Rees-Mogg said.

A member of the DUP said: "From what we have seen and heard we do not believe this deal is the best deal. This deal has the potential to lead to the break-up of the United Kingdom and that is not something we can support."

According to the Times newspaper, the deal would include rules on how the EU intends to strong-arm Britain into accepting a longer-term alignment with its rules and how the backstop option to resolve the Irish border issue will come into force after the transition period and before the final deal.

Although Northern Ireland will not be completely aligned with the EU, the UK government have agreed that the region will remain closer to the EU regulations on some aspects than the rest of the UK. It was being described in Brussels as the "swimming pool" approach to ensuring frictionless trade between Northern Ireland and the south, according to ITV's political editor, "with Great Britain in the shallow end, NI in the deep".

With opposition from Labour, the ERG and DUP, parliament would seem highly unlikely to back the deal, with the PM needing 320 votes from MPs from the 650 total.

If the deal is passed by parliament and signed off by the cabinet, EU leaders could meet on 25 November for a summit to seal the agreement.

According to Michael Spencer, chief executive of Britain's NEX Group, sterling is expected to "rally quite sharply" if the Brexit deal is signed off by the cabinet and supported by parliament.

"If the deal is perceived by the market as being a proper deal. I would imagine sterling could rally quite sharply, easily to $1.35, $1.37", Spencer told CNBC.

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