The British government warned Tuesday that it will be “essentially impossible” to strike a Brexit deal with the European Union if the bloc continues to stand by a key trade demand involving Northern Ireland.
The grim assessment from Prime Minister Boris Johnson's office following a phone call between the British leader and German Chancellor Angela Merkel comes just weeks before an Oct. 31 deadline to leave the EU. The EU has been responding coolly to the U.K.'s plan for maintaining an open Irish border after Brexit, which has been the main stumbling block to a deal.
Downing St. said Merkel told the prime minister Tuesday morning that "a deal is overwhelmingly unlikely" unless Northern Ireland remains in a customs union with the EU — something the U.K. says it can't allow.
It added that "if this represents a new established position, then it means a deal is essentially impossible not just now but ever."
A European Union flag flies near Parliament in London on Tuesday. (AP)
Currently, goods and people flow freely between EU member Ireland and the U.K.'s Northern Ireland. The EU and the U.K. have agreed there must be no checks or infrastructure along that border, yet Britain wants to leave the EU's customs union so it can strike new trade deals around the world, making some sort of checks on goods crossing that border all but inevitable.
Under a proposed U.K. Brexit plan there would be customs checks, but Britain says they could be conducted away from Northern Ireland’s border.
However, EU officials oppose any customs checks and are skeptical of U.K. claims they could be achieved through largely untested technology. EU leaders also have been sharply critical of a proposal that would give Northern Ireland's legislature an effective veto on key elements of the Irish border arrangements in the future.
Johnson has urged European leaders to compromise and sit down for face-to-face talks. So far, the EU is resisting, saying the U.K. must show more "realism" in its proposals.
“At stake is the future of Europe and the UK, as well as the security and interests of our people,” European Council President Donald Tusk tweeted at Johnson on Tuesday, adding that “what’s at stake is not winning some stupid blame game.”
Britain's Prime Minister Boris Johnson speaks to mental health professionals during his visit to Watford General Hospital, in Watford, on Monday. (AP)
The last scheduled opportunity to reach a deal is Oct. 17-18, when all 28 EU leaders, including Johnson, are due to meet in Brussels. French President Emmanuel Macron has said the EU will decide by the end of this week whether a deal is possible, or whether the two sides should buckle up for a rocky no-deal departure.
Johnson insists the U.K. will leave the EU on Oct. 31 even without a deal. But many in the EU — and in Britain — are skeptical that Britain will leave the bloc that day, because the U.K. Parliament has passed a law compelling the government to ask the EU for a delay to Brexit if no deal is agreed upon by Oct. 19.
Keir Starmer, the Brexit spokesman for the main opposition Labour Party, said Downing St.’s statement Tuesday was "yet another cynical attempt by No. 10 to sabotage the negotiations."
"Boris Johnson will never take responsibility for his own failure to put forward a credible deal. His strategy from Day One has been for a no-deal Brexit," he said.
A No 10 source says a Brexit deal is "essentially impossible" after a call between the PM and Angela Merkel.
Boris Johnson spoke to the German chancellor earlier about the proposals he put forward to the EU - but the source said she made clear a deal based on them was "overwhelmingly unlikely".
They also claimed she said a deal would never be possible unless Northern Ireland stayed in a customs union.
But Labour called it a "cynical attempt to sabotage the negotiations".
Shadow Brexit secretary Sir Keir Starmer said Mr Johnson "will never take responsibility for his own failure to put forward a credible deal", and called on Parliament to "unite prevent this reckless government crashing us out of the EU".
The latest developments came after leaks from the European Commission showed major concerns from the EU about the UK's Brexit plan.
Mr Johnson sent new proposals to Brussels last week, with the key focus being on replacing the so-called backstop - the policy negotiated by Theresa May and the EU to prevent a hard border returning to the island of Ireland - which has long been a sticking point.
But after the phone call, the No 10 source accused the EU of being "willing to torpedo the Good Friday agreement" - the peace process agreed in Northern Ireland in the 1990s by refusing to accept Mr Johnson's proposals.
The government argues allowing Stormont to approve part of the PM's plan is key to respecting the so-called "principle of consent" in the Good Friday Agreement, but Irish Prime Minister Leo Varadkar has warned it could actually undermine that principle by giving one party in Northern Ireland a veto over what happens to the country as a whole.
'Scupper a delay'
Mr Johnson has insisted the UK will leave the EU on the Brexit deadline of 31 October, with or without a deal. That is despite legislation passed by MPs last month known, as the Benn Act, which requires Mr Johnson to write to the EU requesting a further delay if no deal is signed off by Parliament by 19 October - unless MPs agree to a no-deal Brexit.
The government has not denied the briefing, which also said Mr Johnson "will do all sorts of things to scupper a delay" to leaving the EU.
Earlier, the BBC's political editor Laura Kuenssberg said there was a growing expectation in government Brexit talks would fail before the week was out.
'Obstructive' strategy
After presenting the plans to the EU, government sources hoped the UK might be able to enter an intense 10-day period of negotiations almost immediately, with the aim of coming to a final agreement at an EU summit on 17 October.
But a government source told the BBC the UK was not willing to move away from the principle of providing a consent mechanism for Northern Ireland or the plan for leaving the customs union.
And if the EU does not accept these principles, "that will be that" and the plan moving forward would be an "obstructive" strategy towards the EU.
The No 10 said the call between Mr Johnson and Ms Merkel was a "clarifying moment", adding: "Talks in Brussels are close to breaking down, despite the fact that the UK has moved a long way."
What are the PM's border plans?
Under Mr Johnson's proposals, which he calls a "broad landing zone" for a new deal with the EU:
Northern Ireland would leave the EU's customs union alongside the rest of the UK, at the start of 2021
But Northern Ireland would continue to apply EU legislation relating to agricultural and other products, if the Northern Ireland Assembly approves
This arrangement could, in theory, continue indefinitely, but the consent of Northern Ireland's politicians would have to be sought every four years
Customs checks on goods traded between the UK and EU would be "decentralised", with paperwork submitted electronically and only a "very small number" of physical checks
These checks should take place away from the border itself, at business premises or at "other points in the supply chain"
What about the EU?
After receiving the proposals, the EU pledged to examine them carefully.
But a number of senior figures, including Mr Varadkar, warned the proposals did not form the basis for deeper negotiations - even if they believed a deal could still be done.
French President Emanuel Macron said the EU would decide at the end of the week whether a new deal was possible.
But a leaked presentation to EU diplomats revealed they were unwilling to accept the UK's plans committing to no checks on either side of the Irish border if the Northern Ireland Assembly - Stormont - is granted a veto and there is no guarantee of checks on the UK side.
BBC Brussels correspondent Adam Fleming said EU negotiators were "so nonplussed by the proposal they asked if it was a mistake".
It is understood the UK also wants continuing access to several EU trade databases, even if Stormont withholds its consent for the new arrangements.
In the report, the think tank said government borrowing was likely to rise to £100bn and total debt would soar to 90% of national income.
The IFS's director, Paul Johnson, said the government was "now adrift without any effective fiscal anchor".
But after the warning - directed at the chancellor as he prepares his annual budget - the Treasury said any decisions would be made "with a view to the long-term sustainability of the public finances".
The Independent Workers Union of Great Britain is supporting three of its members to force the government to seek an extension to the deadline over fears their workers' rights would be watered down.
The government has promised EU-law derived employment rights will remain in law after Brexit - such as minimum paid holiday and working hours regulations - but the union says ministers would have free rein to change them after the UK leaves the EU.
The case follows a challenge in the High Court by civil rights group Liberty, which is seeking assurances that the government will abide by the Benn Act to seek an extension if no deal is agreed before 19 October.
In Scotland, a separate challenge has been brought to the Inner House of the Court of Session - Scotland's highest court - by businessman Dale Vince, Jolyon Maugham QC and SNP MP Joanna Cherry, to ask judges to consider whether a court can sign a Brexit extension request letter on behalf of the government.
The court will also hear an appeal against a ruling, given on Monday, that Mr Johnson can be trusted to apply the law.
Timeline: What's happening ahead of Brexit deadline?
Tuesday 8 October - Last working day in the House of Commons before it is due to be prorogued - suspended - ahead of a Queen's Speech to begin a new parliamentary session.
Monday 14 October - The Commons is due to return, and the government will use the Queen's Speech to set out its legislative agenda. The speech will then be debated by MPs throughout the week.
Thursday 17 October - Crucial two-day summit of EU leaders begins in Brussels. This is the last such meeting currently scheduled before the Brexit deadline.
Saturday 19 October - Date by which the PM must ask the EU for another delay to Brexit under the Benn Act, if no Brexit deal has been approved by Parliament and they have not agreed to the UK leaving with no-deal.
Thursday 31 October - Date by which the UK is due to leave the EU, with or without a withdrawal agreement.
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LONDON — He is the bane of bankers, a bearded, teetotaling socialist often derided in the British press and in Parliament for his efforts to suppress dissent inside the Labour Party and his radical plans to remake the British economy.
But in the unmitigated chaos of Brexit, Jeremy Corbyn, the opposition Labour leader, is trying to remint himself as a safe pair of hands, and an unlikely salve to jittery British markets panicked by Prime Minister Boris Johnson’s plans for an abrupt split with the European Union.
And, surprisingly, it might be working.
“‘What method of execution would you prefer?’ is basically the question,” said David Willetts, a Conservative former minister who was once an aide to Margaret Thatcher. “Corbyn would in normal circumstances look like an off-the-scale risky gamble. However, Brexit is the single biggest change in Britain’s economic and political relations in 40 years, so Brexit itself is an off-the-scale economic gamble.”
With an early election looming, Mr. Johnson’s Conservative Party, once a friend to big business and a refuge for establishment figures of all types, has torched one convention after another, creating dust-ups with Queen Elizabeth II, the Supreme Court and Parliament. The prime minister’s proposed Brexit deal, proffered last week to Brussels, was met with so much dismay that most analysts believe he is fully resigned to Britain leaving the bloc without one.
That has turned Mr. Corbyn — a lifelong rabble-rouser and one of the most left-wing leaders in Labour’s century-long history — into an improbable figure of restraint. He is implacably opposed to a no-deal Brexit and promises a second referendum that could reverse the split altogether.
Suddenly, banks have been left grudgingly weighing the benefits of a party run by neo-Marxists, radical union leaders and lawmakers with a history of supporting communist regimes.
And some parts of Labour, famously anti-establishment under Mr. Corbyn, are fretting that they will somehow look like the soberer party in an election dominated by voters’ desire for a shake-up.
“The Tories are promising the most radical and extreme economic disruption in nearly 200 years,” said Tom Kibasi, the director of the left-leaning Institute for Public Policy Research, calling a no-deal Brexit the biggest upheaval since the British Empire abolished slavery in the 1830s. “The scale of economic chaos the Tories are promising means that any of Labour’s policies pale in significance.”
But, he said: “The issue is right now the public have a clear appetite for change. The question is, are you going to offer them positive change, or change that’s chaos and disruption?”
Mr. Corbyn’s new sheen of acceptability has not yet paid dividends with the public. In carving out the middle ground on Brexit — promising a second referendum, but refusing to commit to one side or the other — he has alienated both Leave and Remain voters. And analysts say it is not clear whether Mr. Corbyn’s plans for a generational reordering of the economy will cut through as long as voters remain obsessed with Brexit.
Despite his involvement in efforts to avert a no-deal Brexit, Mr. Corbyn is still despised by a cohort of anti-Brexit lawmakers, some of whom blame him for failing to get a grip on anti-Semitism in the Labour Party. Those lawmakers have resisted trying to unseat the government and install him as a caretaker prime minister.
But in Britain’s winner-take-all voting system, Labour is still the party best positioned to wrench power from the Conservatives. That has narrowed the choice awaiting Britain, some analysts say: a Johnson-led government increasingly bent on a no-deal Brexit, or a Corbyn-led government that would stop it.
And even for some of Mr. Corbyn’s biggest foes, that is an easy choice to make.
Ken Clarke, a Conservative former chancellor of the Exchequer who has locked horns with Labour for decades, said last month, “Both are awful prospects, but I think a no-deal Brexit could cause far more damage to our future economic success than Corbyn.”
Even in the City of London, there is growing feeling that the financial industry could withstand the shock of Mr. Corbyn’s hard-left economic plans if that were what it had to do to avoid Britain leaving the European Union without a deal managing future relations. For financial analysts, there is nothing that tempers fears of Labour’s plans to redistribute wealth and assets like an even more daring economic experiment: cutting adrift an export market of half a billion people.
“Between a Corbyn government that delivers a second referendum at the cost of some policies which from an economic perspective we may not be entirely happy with, and a Conservative government that is broadly pro-business but does the irreversible damage of the U.K. leaving without a deal, I’d choose the former,” said Christian Schulz, an analyst for Citi.
Peter Dixon, a senior economist for Commerzbank, said companies could adjust to Mr. Corbyn, but not as easily to the sudden turmoil of a no-deal Brexit.
“They’re looking at the prospect of a no-deal and saying, actually, this would be an even bigger shock to the economy than a Corbyn government because perhaps at least you’d have a period of time to adjust,” he said.
For Britain’s financial district, it is the end of an era of being able to freely hammer Labour for moderate tax increases, safe in the knowledge that the Conservative Party would follow market orthodoxy on open trading arrangements.
“The markets can’t have their cake and eat it,” said Paul Dales, the chief United Kingdom economist for Capital Economics, a research company.
Mr. Corbyn, a vegetarian with a grandfatherly manner who for decades wandered the hard-left hinterlands of the Labour Party, has not made himself many friends in the City of London with a series of bold proposals he has rolled out over the last few weeks: creating a state-owned pharmaceutical company, attacking private schools, forcing companies to make their workforces into shareholders.
He also wants to nationalize the railways, raise new taxes on the financial industry and create a four-day workweek.
Those policies could permanently undo the anti-regulatory crusade waged 40 years ago by Ms. Thatcher, cementing high-tax, pro-workforce rules. Labour supporters hope these measures will address gaping inequality, while critics fear they are built on an outdated vision of Britain’s economy.
It’s still, to many if not most bankers, a program that looks politically repugnant and personally costly. And the calculation that it might be less catastrophic to banks than a no-deal Brexit remains hotly contested in some circles.
But analysts say the markets have taken comfort in the fact that even if Mr. Corbyn performs well in the next election, he will probably not win enough seats in Parliament to govern alone. Being forced to rely on the backing of one or more smaller parties, like the centrist Liberal Democrats or the economically center-left Scottish National Party, would rein in Labour’s most radical plans.
Labour has also made a concerted, if low-key, effort in recent months to prepare the financial industry for a turnover in Downing Street. Industry representatives say they have largely left impressed by John McDonnell, Labour’s Treasury spokesman, describing him as solicitous of their needs when it comes to Brexit and matter-of-fact in laying out his party’s more confrontational economic plans.
“John McDonnell is someone they can talk to, do business with,” said Lord Robert Kerslake, a former civil service chief who has set up some of Labour’s meetings with businesspeople.
(Bankers cannot, though, buy dinner for Mr. McDonnell, who has protected his abstemious reputation — and the party’s anti-elite bona fides — by insisting on “tea and biscuits, nothing else,” Lord Kerslake said. That is a contrast with the “prawn cocktail offensive” that a more corporate Labour Party waged under Tony Blair in the City of London two decades ago.)
Labour’s rehabilitation in the eye of the markets mirrors a lift that leftist parties have gotten across Europe simply for treading cautiously on European trade. Facing up against right-wing, populist campaigns against European integration, left-wing parties, said Mr. Schulz, the Citi analyst, are finding that “their pro-Europe credentials ultimately trumped question marks about their economic policies.”
Whatever respectability Mr. Corbyn has won in the bare-knuckled fight over Brexit may not last long. One of his biggest selling points for bankers, after all, is that some of them think they can reverse his policies within a matter of years. And some of his grudging Conservative backers, like Guto Bebb, a former junior defense minister, have in mind nothing more than “a short-term Jeremy Corbyn government” that would avert what he called “the generational damage that would be caused by a no-deal Brexit.”
Mr. Corbyn’s more immediate problem is not only pitching himself as a sober option in an era of political madness, but also how to make his proposals stand out amid fervent campaigning on Brexit on all sides.
Mr. Johnson, analysts say, has a slew of ready-made slogans for his anti-establishment, no-holds-barred Brexit campaign, even if they disguise the tumult that is almost sure to follow. Mr. Corbyn, on the other hand, has to make a knottier case for caution on Brexit.
“It depends whether the Tories are found out or not,” Mr. Kibasi said. “Labour’s story is more complicated, if more truthful.”
The wife of an American diplomat has left the UK after being made a suspect in an investigation into a fatal crash.
Harry Dunn, 19, of Charlton, Banbury, was killed when his motorbike crashed with a car near RAF Croughton in Northamptonshire on 27 August.
Police said they wanted to interview an American woman in her 40s.
Foreign Secretary Dominic Raab said he had called the US Ambassador to express his "disappointment" she had left the country.
Supt Sarah Johnson said: "Northamptonshire Police followed all of its usual procedures following the incident, including liaising closely with the suspect, who engaged fully with us at the time and had previously confirmed to us that she had no plans to leave the country in the near future.
"The force is now exploring all opportunities through diplomatic channels to ensure that the investigation continues to progress.
"Harry Dunn's family deserve justice and in order to achieve this, a full and thorough investigation, with the assistance of all parties involved, needs to take place."
RAF Croughton is a United States Air Force communications station.
Harry's mother Charlotte Charles told Sky News: "Everyone loved him, we're utterly broken inside and out, everything hurts day and night, it's an effort to do anything, I ache from it, every limb, every internal organ hurts.
"We don't know how we can start to grieve for him."
Mr Raab said: "I have called the US Ambassador to express the UK's disappointment with their decision, and to urge the Embassy to re-consider it."
The US Embassy in London said: "Embassy officials are in close contact with the appropriate British officials on this matter.
"Due to security and privacy considerations, we cannot confirm the identity of the individuals involved, but we can confirm the family has left the UK."
A British-Australian woman and her Australian boyfriend have been released from an Iranian jail, Australia's government has said.
Jolie King and Mark Firkin were detained in Tehran earlier this year for reportedly flying a drone without a permit while on a trip across Asia.
A second British-Australian, university lecturer Kylie Moore-Gilbert, is still in prison.
Australia's foreign minister said talks to secure her release were ongoing.
Marise Payne told reporters that it was "with some enormous relief" that she could announce Jolie King and Mark Firkin "have been released and returned".
The pair were detained after entering Iran as part of a major trip across Asia to the UK - they were blogging about it for thousands of followers on social media.
Meanwhile, Australia released an Iranian student, Reza Dehbashi Kivi, back to Tehran, according to the country's semi-official news agency Fars.
He had been arrested in September 2018 for allegedly sending American-made military equipment to Iran.
Australia's Attorney General Christian Porter said extradition decisions were made on a "case by case" basis.
In what he said was a longstanding policy, Mr Porter declined to give further details about the decision, saying it could "diminish our government's capacity to deal with future matters of this type in Australia's best interests".
According to Australia's foreign minister Marise Payne, Ms Moore-Gilbert remains in prison in Tehran, where she has been for almost a year having reportedly been given a 10-year sentence.
"Very long-term negotiations" were taking place to secure the release of the Cambridge-educated academic, Ms Payne added.
Ms Moore-Gilbert was most recently a lecturer in Islamic Studies at Melbourne University.
Earlier, Fars reported that the Islamic Republic's judiciary spokesman Gholam Hossein Esmayeeli confirmed Ms Moore-Gilbert, Ms King and Mr Firkin had all been detained for spying.
Media playback is unsupported on your device
The two British-Australian women were believed to be the first British passport holders without dual Iranian nationality to be held in the country in recent years.
Their detention echoes that of British-Iranian mother Nazanin Zaghari-Ratcliffe, who has been imprisoned since 2016 after being convicted of spying, which she denies.
On Friday it was announced that Mrs Zaghari-Ratcliffe would allow her daughter Gabriella, five, to return to the UK to begin schooling.
The mother and daughter were said by family to have travelled together to Iran to visit relatives before she was detained.
Who are the other Britons detained in Iran?
As well as Nazanin Zaghari-Ratcliffe, a number of other dual UK-Iranian citizens are being detained in Iran.
Iran does not recognise dual nationality, and there are no exact figures on the numbers of dual nationals in custody.
But they do include businessman and wildlife conservationist Morad Tahbaz, who also has US citizenship and was arrested in a crackdown on environmental activists in January 2018, and Kameel Ahmady, a social anthropologist, who has been in custody since August.
Anousheh Ashouri, a British-Iranian dual national, was sentenced to 10 years in prison by a court in Tehran after being convicted of spying for Israel.
A British-Australian woman and her Australian boyfriend have been released from an Iranian jail, Australia's government has said.
Jolie King and Mark Firkin were detained in Tehran earlier this year for reportedly flying a drone without a permit while on a trip across Asia.
A second British-Australian, university lecturer Kylie Moore-Gilbert, is still in prison.
Australia's foreign minister said talks to secure her release were ongoing.
Marise Payne told reporters that it was "with some enormous relief" that she could announce Jolie King and Mark Firkin "have been released and returned".
The pair were detained after entering Iran as part of a major trip across Asia to the UK - they were blogging about it for thousands of followers on social media.
Meanwhile, Australia released an Iranian student, Reza Dehbashi Kivi, back to Tehran, according to the country's semi-official news agency Fars.
He had been arrested in September 2018 for allegedly sending American-made military equipment to Iran.
Australia's Attorney General Christian Porter said extradition decisions were made on a "case by case" basis.
In what he said was a longstanding policy, Mr Porter declined to give further details about the decision, saying it could "diminish our government's capacity to deal with future matters of this type in Australia's best interests".
According to Australia's foreign minister Marise Payne, Ms Moore-Gilbert remains in prison in Tehran, where she has been for almost a year having reportedly been given a 10-year sentence.
"Very long-term negotiations" were taking place to secure the release of the Cambridge-educated academic, Ms Payne added.
Ms Moore-Gilbert was most recently a lecturer in Islamic Studies at Melbourne University.
Earlier, Fars reported that the Islamic Republic's judiciary spokesman Gholam Hossein Esmayeeli confirmed Ms Moore-Gilbert, Ms King and Mr Firkin had all been detained for spying.
Media playback is unsupported on your device
The two British-Australian women were believed to be the first British passport holders without dual Iranian nationality to be held in the country in recent years.
Their detention echoes that of British-Iranian mother Nazanin Zaghari-Ratcliffe, who has been imprisoned since 2016 after being convicted of spying, which she denies.
On Friday it was announced that Mrs Zaghari-Ratcliffe would allow her daughter Gabriella, five, to return to the UK to begin schooling.
The mother and daughter were said by family to have travelled together to Iran to visit relatives before she was detained.
Who are the other Britons detained in Iran?
As well as Nazanin Zaghari-Ratcliffe, a number of other dual UK-Iranian citizens are being detained in Iran.
Iran does not recognise dual nationality, and there are no exact figures on the numbers of dual nationals in custody.
But they do include businessman and wildlife conservationist Morad Tahbaz, who also has US citizenship and was arrested in a crackdown on environmental activists in January 2018, and Kameel Ahmady, a social anthropologist, who has been in custody since August.
Anousheh Ashouri, a British-Iranian dual national, was sentenced to 10 years in prison by a court in Tehran after being convicted of spying for Israel.
