EXCL David Davis: MPs must 'drive a stake through the heart' of Theresa May's Brexit deal
MPs must ensure Theresa May suffers a heavy defeat on her Brexit deal so that "the stake goes through its heart", David Davis has said.
In inflammatory comments, the former Brexit Secretary said the agreement must be "buried at the crossroads" because it is "no good at any level".
Speaking to The House magazine, the ex-Cabinet minister also said that a fall in the value of the pound of up to 10% would “be no bad thing” if the UK crashes out of the EU without a deal.
Scores of Tory MPs have suggested they will vote against Mrs May's deal when it comes before the Commons next Tuesday.
Mr Davis said: "This deal is no good at any level. It’s no good in terms of sovereignty, it’s no good in terms of economic future, it’s no good in terms of upsides.
“I don’t believe the Bank of England and the Treasury’s forecast on this. They’ve never been right before, this is a polemical projection. I actually think this is identical in economic terms to being inside the Union, or as close as you can get to identical. What it doesn’t have are any upsides.
“We’ve got to make sure that this doesn’t come back. We’ve got to make sure the stake goes through its heart and it gets buried at the crossroads.”
Asked whether staying in the EU was better than taking the Government’s deal, he said: “That would be a less bad of two horrible options, basically. Staying in the EU. Neither is a good option. Neither is the option that’s going to happen.”
Elsewhere in the interview, Mr Davis argued that the UK’s fear of a no deal Brexit was “slightly ill-placed” as the harm is “asymmetric” with the EU standing to lose more.
He explained: “Firstly, we’ve got a floating pound… it won’t go into freefall.
“The first thing that will happen is it will go about five, ten points down further from the 15 it already is. So, we’ll end up 20 or 25 below what it was before the referendum. That’s not a bad thing. The pound’s always been too high from the point of view of industry because of the effect of the City.
“So, our competitive position with vis-a-vis Europe would be dramatically better even if there are tariffs. It would be much bigger than any tariff impact on us for everything except some agriculture. It will exacerbate the tariff effect on let’s say the German car industry or the German dairy industry for that matter.”
Mr Davis also said the Government could take measures to incentivise firms to increase their capital spending in the event of exiting on WTO terms.
“Big businesses, FTSE100s and so on, have sat back a bit and said well, ‘we won’t actually spend our capital spend yet’. I don’t blame them – I would have done the same if I’d been in their position,” he said.
“But they’ve got the capital programme plans sitting there and they’ve got the money on their balance sheets. You can see that. You can see money building up on British balance sheets.
“So, we can go along and say, ‘okay, we’ll give you a two-year 100% allowance if you use that money now’. It will work, I guarantee you that will work and so there will be an increase, not a decrease in internal capital spend.
“Foreign direct investment is going up, not going down. We can do things if we’re not inside the Union which are under WTO rules to help some bits of our industry, e.g. animal welfare payments for farmers, for example.
“There are things we can do as an operation ourselves. So, pound, individual policy and thirdly we have the upsides. We have the upsides.”
Mr Davis also warned campaigners for a second referendum that they would face a “parliamentary guerrilla war against it”, insisted Article 50 would not be extended, claimed the UK would be first in line for a trade agreement with the US and said the fear of no deal would force Britain and the EU to find an “alternative” solution on Brexit.
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