Theresa May considers longer transition to break Brexit deadlock

Move would effectively prolong the terms of Britain’s EU membership and could potentially break the current impasse

European leaders gather at a summit in which Brexit negotiations are expected to be top of the agenda. AFP

UK prime minister Theresa May is weighing up a plan to stay tied to European Union rules for longer in a radical move designed to break the deadlock in Brexit talks, according to people familiar with the matter.

Mrs May is considering an EU proposal to extend the transition period that’s already due to keep the UK bound to the bloc’s rules for 21 months after exit day.

She signalled her willingness to give ground during talks with fellow EU leaders at a summit in Brussels Wednesday, one of the people said. European Parliament president Antonio Tajani confirmed the issue was discussed between the 28 leaders.

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The move, which would effectively prolong the terms of Britain’s EU membership, could potentially break the impasse. But it would come at a high political price in London.

At the meeting in Brussels, EU leaders decided that not enough progress has been made in negotiations to warrant calling a one-off summit in November for a divorce deal to be signed.

Leaders, who made an effort to send positive messages on their way in, listened to Mrs May for about 15 minutes before having dinner without her. According to three government officials, at least some of them were left puzzled by her presentation.

Mr Tajani said Mrs May had offered nothing new, though he thought her “body language” was positive. The EU is now aiming for the December summit to get the deal done, according to one of the officials, though the idea of a November meeting hasn’t been ruled out.

Chief EU negotiator Michel Barnier said “much more time” was needed, and that he would continue working “calmly and patiently.”

Talks are stalled on the question of how to avoid a policed frontier between Northern Ireland and the Republic of Ireland, without erecting new barriers between Northern Ireland and the rest of the UK

The prime minister and her team are willing to consider the longer transition as a way to overcome the the Irish border issue, according to people familiar with the matter.

While it could help Mrs May sell a deal at home, it won’t remove the need to accept the most controversial part of the EU’s proposal – that in a last-resort situation, Northern Ireland could be split off from the rest of the UK

Eurosceptics in Mrs May’s Conservative Party are likely to accuse her of delaying Brexit, and will balk at the prospect of Britain continuing to pay about 10 billion euros a year into the EU’s budget. Any deal agreed in Brussels needs to win approval in Parliament, where Mrs May doesn’t have a majority and faces opposition on all sides.

One of the people familiar with the discussions said Mrs May’s Tory party would find it difficult to be fighting the next general election – due in 2022 – while the country is still inside the single market and customs union.

The idea was discussed on Tuesday during a meeting of Mrs May’s Cabinet in London. One of the people said the international trade secretary Liam Fox was the most vocal in his openness to the idea of extending the transition. His voice is important as he is a veteran Brexiteer. Other ministers spoke about the issue during the discussion but were more cautious, the person said.

The EU hopes an extended transition will be enough to help Mrs May accept its plan for the Irish border, an official said. The plan is known as the backstop because it’s an insurance clause to make sure that no matter what future trading arrangement the two sides decide on, no new border will emerge on the island of Ireland.

The EU side is still insisting that the exit treaty include its proposed backstop. Mrs May says this new would destroy the constitutional integrity of the UK, by putting a customs border between Northern Ireland and the British mainland.

Negotiators will try to find a form of words to say that as long as the transition is extended long enough for the UK and EU to agree a free trade deal, the backstop will never be used.

But the devil is in the detail. There’s no guarantee the trade deal could be finalized in three years and the EU would expect the UK to sign up to some kind of customs union. The terms of that, including whether the UK would have an independent trade policy, could only be agreed after the UK has left.