Brexit trade deal to wipe £45bn from UK economy

Cabinet Office minister Michael Gove and European Commission vice president Maros Sefcovic have pledged their full commitment to “proper implementation” of the protocol in Northern Ireland.

It seems their meeting went about as well as could be expected – a “frank but constructive” discussion – and they’re expected to hold a virtual meeting with NI business leaders next week in an effort to find “workable solutions” to red tape disruption.

Sefcovic ruled out major changes to the protocol, and Ireland’s premier Micheál Martin said any pause in grace period deadlines could only be “months”.

The UK will suffer an economic hit four times greater than the EU, according to a forecast from Brussels.

The European Commission predicted Britain’s GDP loss by the end of 2022 will be 2.25 per cent. In contrast, the hit taken by the EU will only be 0.5 per cent.

“While the FTA [free trade agreement] improves the situation as compared to an outcome with no trade agreement between the EU and the UK, it cannot come close to matching the benefits of the trading relations provided by EU membership,” said the commission.

As Amsterdam surpasses London as Europe’s largest financial trading centre, fears are growing that the EU will attempt to wrestle lucrative financial business away from the UK with a hard line on “equivalence” agreements.

No 10 claimed post-Brexit “fragmentation” of share trading away from London is in no one’s interests (trying telling that to the Dutch).

Keir Starmer said it was time for chancellor Rishi Sunak to step up and protect the City. The Labour leader said he is “very worried” that the Brexit deal has almost no provision for financial services.

“What I want is to see progress here. The chancellor said that he would look after the City of London on financial services; he needs to make good on that promise because we absolutely need to protect our financial services.”

Bank of England governor Andy Haldane is worried about it too. But in his latest comments, Haldane described the UK economy as a “coiled spring” set to surge back this spring.

Cabinet Office minister Michael Gove has announced at £20m support fund to help small businesses in the UK adapt to Brexit disruption.

Firms will be able to apply for up to £2,000 to help pay for new paperwork and deal with other red tape problems.

Gove said: “The government has listened carefully to the issues raised by the business community through the Brexit business taskforce, and that’s why we are bringing forward this financial support to help small businesses adapt to the changes to our trading relationship with the EU.”

Brexit has been called an “unmitigated disaster” by food industry chiefs, as they told MPs about the impact of new arrangements.

Sector leaders told the trade select committee on trade about the scale of disruption, which already caused some businesses to shut their doors for good.

The Food and Drink Administration’s Ian Wright confirmed that food exports to the EU have declined by 50 to 60 per cent in January. He also warned that we could be 50,000 customs agents short of what is needed when full regulations are enforced.

Fisheries expert Terri Portmann said Brexit had been an “unmitigated disaster” for the sector. “We have already seen seafood businesses who heavily relied upon an export market close their doors – companies that have been around for 30 to 40 years.”

Boris Johnson and his ministers are discussing long-term plans for social distancing to remain in place until at least the autumn, according to a report in The Times. “The thinking is that social distancing will need to be in place for a long time to come,” said an official.

Tory MPs are not happy about it. Nor are they happy at the latest comments from government advisors on some curbs staying place beyond spring.

Sage’s Prof John Edmunds said social distancing is likely to remain throughout 2021, while face mask wearing in public could be in place “forever”.

He also told ITV’s Peston: “If we opened schools I think the reproduction number would get close to 1 and possibly exceed 1.”

Mark Harper, head of the lockdown-sceptic group of 70 Conservative MPs, said the PM must not “blackslide” on the promise to get pupils back by 8 March. Tory MP Robert Halfon said the date should be “signed in blood”.

The Bank of England’s governor Andy Haldane has talked about the “coiled spring” waiting to bounce back. But the latest official figures show the unprecedented scale of the nation’s economic slump.

The UK’s economy shrunk by a record 9.9 per cent in 2020. Output expanded only 1 per cent between October and December – following 16.1 per cent growth in the previous three months, the Office for National Statistics reported.

“Loosening of restrictions in many parts of the UK saw elements of the economy recover some lost ground in December, with hospitality, car sales and hairdressers all seeing growth. An increase in Covid-19 testing and tracing also boosted output,” said the ONS.

“However, GDP for the year fell by nearly 10 per cent, more than twice as much as the previous largest annual fall on record.”

Safeguarding minister Victoria Atkins has defended the UK’s decision only to introduce a hotel quarantine system nearly a year into the pandemic.

“We have some of the strongest border measures in the world and as of Monday, with the introduction of the red list set of countries, these measures will be even stronger.”

Giving little away on the timetable for lockdown easing, Atkins also said it is “up to Scotland” to decide where passengers landing in England but travelling on to the country should quarantine. “That will be for the Scottish government to work out.”

The minister said it is “reasonable” to allow travellers quarantining in hotels outside for a “gulp of fresh air” – despite an epidemiologist warning it is “risky”.

Rawiri Waititi, member of the New Zealand parliament, has received global attention for not wearing a tie in the chamber – and being kicked out as a result.

Our associate editor Sean O’Grady has taken a look at changing norms in the UK, and what is and isn’t considered acceptable by our elected officials.

Priti Patel has criticised sports stars who ‘take the knee’ and attacked last year’s Black Lives Matter protests as “dreadful”.

Asked on LBC if she would ever adopt the gesture, the home secretary said: “No I would not. There are other ways in which people can express their opinions.”

Ms Patel also refused to express confidence in Met Commissioner Cressida Dick, saying she “does a lot of great work” – but that there were “questions’ about her.

At one point, she appeared to say she did not support protests at all, before clarifying she opposed the BLM demonstrations that swept the country last summer, saying: “Those protests were dreadful.”