Theresa May’s reported agreement with her cabinet on a future trading relationship with the EU has been criticised as based on “pure illusion” by the European council president, Donald Tusk, as frustration with the UK erupted in Brussels.
Reports that Theresa May’s inner cabinet had agreed on a policy of “managed divergence” during eight hours of talks at an away day in Chequers were met with incredulity by EU leaders.
Tusk told reporters: “I am glad the UK government seems to be moving towards a more detailed position. However if the media reports are correct I am afraid the UK position today is based on pure illusion. It looks like the cake [and eat it] philosophy is still alive.
“From the very start it has been a set principle of the EU 27 that there cannot be any cherrypicking of single market à la carte. This will continue to be a key principle, I have no doubt.
“I am absolutely sure we will be extremely realistic as 27 in our assessment of the proposals.”
Tusk and the leader of the European commission, Jean-Claude Juncker, enjoyed a joke at the expense of the former British prime minister David Cameron who opposed Juncker’s candidacy as commission president.
In response to Juncker asking about the fate of Cameron, Tusk responded: “I have heard some rumours that he is in a quite comfortable position.”
Juncker responded: “He wanted me to be in such a comfortable position but he did not succeed.”
Speaking at a summit of the 27 other EU member states in Brussels, to discuss the EU’s budget and leadership post-Brexit, Leo Varadkar, the Irish taoiseach, also insisted that the single market was “not à la carte”.
It is believed the UK government is seeking to maintain frictionless trade in some sectors by staying in lock-step alignment with EU regulation, while opening up the prospect of diverging in other areas in order to gain a competitive advantage in the international marketplace.
Varadkar told reporters: “It is not possible for UK to be aligned to EU when it suits and not when it doesn’t. The UK needs to square that circle. It doesn’t appear that the circle has yet been squared.
“The UK position needs to be backed up with real detail that can be written into a legal treaty with the EU. We are well beyond the point of aspirations and principle. We need detail.”
Senior EU diplomats said expectations were now low for Theresa May’s speech – planned for next Friday – in which she will offer her vision of the future trading relationship between the EU and the UK.
The Dutch prime minister, Mark Rutte, who met May in London earlier in the week to deliver an uncompromising call for a clear and realisable vision from the UK government, said: “As good friends [of the Brits], we can bring the difficult messages like I did at Downing Street, asking Theresa May to be as clear as possible on what she wants to achieve on the second phase of negotiations.”
May is to set out next week what she hopes will be the defining vision of the UK’s post-Brexit relationship with the EU, but faces warnings that even if she manages to unite the Conservative party around her plan, Brussels could stay resistant.
The prime minister will speak next Friday – it has not yet been confirmed where – to outline the fruits of the marathon discussions at Chequers in which she and her inner cabinet sought to thrash out a strategy acceptable to the various Brexit camps.
But with reports from inside Thursday’s talks at the PM’s country retreat saying the aim was one of targeted divergence from EU regulations, experts said there were likely to be accusations of cherrypicking.
Another conflict is expected over the rights of EU nationals arriving in the UK during the post-Brexit transition period. May’s spokesman reiterated on Friday that these would be less than those enjoyed by existing residents, an idea viewed in Brussels as unacceptable.
Ructions are likely over attempts by rebel Tory MPs, possibly backed by Labour, to force the government to commit to remaining in some form of customs union after departure, with a new parliamentary amendment gathering support.
May’s spokesman said the talks at Chequers had agreed “the basis of the prime minister’s speech on the future relationship”. He said: “Discussions will now take place at cabinet and you expect the prime minister to deliver her speech next Friday.”
While May will hope her vision will unite enough of her MPs to be seen as credible, it could be a different matter with the EU, which has repeatedly said it does not want a Brexit model where the UK chooses in which areas to diverge on regulations.
Charles Grant, director of the Centre for European Reform thinktank, said the approach agreed at Chequers seemed to be the so-called baskets model, where the UK would align with the EU in some areas, have some alignment in others, and none elsewhere.
“I think there’s no chance of the EU agreeing to the proposal,” he said. “The EU’s obsessed with the level playing field. It doesn’t trust any enforcement mechanism proposed by the British to police it adequately.”
May’s preferred option on new rules for EU nationals might also not survive contact with Brussels, Grant added. “My guess is Mrs May will find a way of climbing down gracefully, and giving the EU most of what it wants.”
May’s chosen approach rejects the idea of being in any form of customs unions with the EU, with the health secretary, Jeremy Hunt, stressing on Friday that this would not happen.
When the government’s trade bill returns to the Commons, MPs will vote on an amendment proposed by a group of remain-minded Conservatives – Anna Soubry, Nicky Morgan, Sarah Wollaston, Stephen Hammond and Jonathan Djanogly – as well as Labour’s Chuka Umunna, calling for a continued customs union.
With at least five other Conservatives likely to back the amendment, it could pass if Labour supported the measure. This is, however, by no means certain.
Jeremy Corbyn is to make a Brexit speech on Monday in which he could clarify the party’s position, after he and several other Labour frontbenchers indicated they could back membership of a customs union.
Separately, May risks upsetting hardline Brexiters in her own party with a proposal to sign up certain industrial sectors, such as chemicals, to the monitoring of the relevant EU regulators, according to a report by Bloomberg.
While this would help access to EU markets, the regulators are overseen by the European court of justice, an organisation May has previously promised would have no role in UK affairs after Brexit.