EU triggers plans for no-deal Brexit as Varadkar insists fall-out will not affect budget

EU triggers plan to protect EU citizens in the event of a no-deal Brexit
Plans cover 14 areas most likely to be affected, ranging from financial services to aviation, customs and carbon emissions trading
Irish Government prepares to publish its own no-deal contingency plans
Varadkar insists Brexit won’t affect budget plans

The European Commission has triggered an action plan to protect EU citizens and businesses from “major disruption” if the UK crashes out without a deal on March 29.

With just 100 days to go the scheduled date of Brexit, and the UK Parliament apparently far from ratifying Theresa May’s Withdrawal Agreement, the commission said it was “essential and urgent” to act.

Plans cover 14 areas most likely to be affected, ranging from financial services to aviation, customs and carbon emissions trading, and are designed to “protect the vital interests of the EU”.

The move came a day after the Cabinet agreed to implement in full the UK’s own preparations for a possible no-deal Brexit.

In a statement issued in Brussels, the commission stressed that the ratification of the November Withdrawal Agreement continues to be its “objective and priority”.

It said: “Irrespective of the scenario envisaged, the United Kingdom’s choice to leave the European Union will cause significant disruption.”

Measures being put in place would “limit the most significant damage” caused by a potential no-deal scenario but could not mitigate in full the impact of the UK leaving without an agreement, it said.

Read More: John Downing: ‘Uber-Brexiteers’ attacks on the Taoiseach will do him no harm’
It warned they would not “in any way compensate for the lack of stakeholder preparedness or replicate the full benefits of EU membership or the terms of any transition period, as provided for in the Withdrawal Agreement”.

Measures being undertaken now are “limited to specific areas where it is absolutely necessary to protect the vital interests of the EU” and will be “temporary in nature, limited in scope and adopted unilaterally by the EU”.

The commission urged EU27 states to take a “generous” approach to the rights of UK citizens in the EU following a no-deal Brexit, “provided that this approach is reciprocated by the UK”.

EU27 states should ensure UK citizens legally residing in the EU on the date of withdrawal will continue to be considered legal residents and should take a “pragmatic” approach to granting temporary residence status, it said.

UK nationals should be exempted from visa requirements, provided that all EU citizens are equally exempt from UK visas.

Remaining EU states should take “all possible steps” to protect social security rights of UK expats who have settled in their countries as well as their nationals living in Britain.

The commission announced “a limited number of contingency measures” to safeguard financial stability in the EU27 following a no-deal Brexit.

These include:

A 12-month equivalence decision ensuring there will be no immediate disruption in the central clearing of derivatives
A 24-month equivalence decision to avoid disruption in central depositaries services for EU operators currently using UK operators
Two 12-month regulations allowing the renewal of certain over-the-counter derivatives contracts
Temporary measures were adopted to avoid “full interruption” of air traffic between the EU and UK.

But the commission warned they will only ensure “basic connectivity” and “in no means replicate the significant advantages of membership of the Single European Sky”.

The statement said it was “essential” for EU27 states to make preparations to apply customs controls in relation to the UK in the case of a no-deal Brexit.

It said that from January 1, the UK’s involvement in elements of the carbon emissions trading system will be temporarily suspended, to ensure that an eventual no-deal Brexit does not disrupt its smooth functioning.

The commission proposed a regulation to allow the continuation of the EU’s Peace programme in Northern Ireland until the end of 2020 in the event of no deal.

Meanwhile, the British government has put 3,500 troops on standby to help deal with potential disruption caused by a no-deal Brexit.

The UK cabinet agreed to activate all its no-deal plans and advised the public to prepare for disruptions.

The contingency plans outline how the public will be urged to prepare themselves and their families over the Christmas holidays.

Television advertisement and social media are expected to be used to for public service announcements. Some 3,500 troops will be on standby to help deal with any disruptions, ranging from emergency engineering work to shortage of supplies such as medicines. UK government sources insisted they were not being put in place to deal with public disorder.

Businesses will receive a 100-plus page online package to help them get ready. Emails to 80,000 of the most likely to be affected companies will be sent over the next few days.

Leo Varadkar’s own proposals include ’45 items’ of fast-track legislation

It comes as the Irish Government prepares to publish its own no-deal contingency plans, which include proposals to have dozens of pieces of legislation passed by TDs in just 29 days.

Their plan could see all Dáil business set aside in order to facilitate the passage of legislation to ensure the continued payment of pensions and recognition of cross-border healthcare arrangements.

The Dáil breaks for almost a month today, returning on the same week that the British prime minister intends to finally put her Brexit deal to a vote in Westminster.

However, there is growing concern among Opposition parties here that there will not be enough time to adequately debate the ramifications of a no-deal scenario.

Taoiseach Leo Varadkar continues to insist Ireland is ready, but Labour Party leader Brendan Howlin questioned the level of detail made public.

“Is it envisaged we would pass 45 pieces of legislation in 29 days that are sight unseen at this stage?” he asked.

Mr Howlin demanded the Taoiseach provide a “comprehensive briefing” in advance of the recess so that TDs will be in a position to “scrutinise measures that might be necessary” over the holidays.

“I heard the British secretary of state for health say that he had become the biggest purchaser of fridges in the world as they stockpile medicines. That is how absurd things have become.

“We need to know specifically what we must do here to be ready for it and not be inundated by legislation we have not had time to reflect upon when we come back after the recess,” Mr Howlin said.

Fianna Fáil’s Lisa Chambers demanded a debate, saying all projections for Budget 2019 were based on an assumption that there would be a deal.

Mr Varadkar said there are “45 items” that will need to be dealt with – but they are not all primary legislation that will need Dáil approval.

“Some regulation, some statutory instrument and some primary legislation of it but also the non-legislative aspects of it,” he told the Dáil, adding he will ensure a full briefing is provided as soon as possible.

Speaking this morning, Mr Varadkar rejected charges by Fianna Fáil leader, Micheál Martin, that the Government was being unduly “secretive” about preparations for a no-deal Brexit.

Mr Martin insisted that he was by-passing the democratically elected parliament which he would soon be asking to put through special Brexit legislation. There was also a question of the Budget for next year having to be revised to take account of the need for extra investment.

“Do you have any respect for the Dáil at all?” the Fianna Fáil leader asked. He added that the Dáil Christmas break began today, and there would only be 29 Dáil sitting days next year before the Brexit deadline.

The Taoiseach said that he wanted to await the EU Commission’s plans for a no-deal Brexit.

He said Ireland’s plans must dovetail with these EU plans, and Irish plans would emerge tomorrow after a meeting with business and other groups concerned by Brexit.

But Mr Varadkar also repeated his statement of last Friday that even a no-deal Brexit would not cause a mini-Budget in spring 2019. He also again stressed that he believed a no-deal Brexit was “unlikely.”

The Taoiseach said the Budget presented on October 9 last was framed with Brexit economic fallout in mind. He said there would be a small budget surplus this year and a larger one next year, a “Rainy Day Fund” will set up next year, and there will be 25pc extra investment in transport, housing and other infrastructure projects.

“It is not intended that we would re-visit the Budget or introduce a mini-Budget,” Mr Varadkar insisted.

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