Sunak puts Brexit bill on ice as hopes rise of New Year EU deal

Rishi Sunak has put the Northern Ireland Brexit protocol bill on ice until the new year after private talks with Brussels paved the way for a new deal by February.

Senior officials say the bill will not be returned to the Lords this year, giving negotiators time to thrash out new trade rules for a St Valentine’s Day agreement.

The bill is designed to give Britain the right to unilaterally suspend aspects of the protocol, including excessive border checks, if there is no deal with Brussels.

But even Lord Caine, the minister in charge of pushing the bill through the Lords, has privately raised questions about whether it may break international law.

Caine said he did not recognise the remarks attributed to him.

Any delay to the bill will make the European Research Group (ERG) of hardline Eurosceptics suspicious Sunak is preparing to cede red lines on sovereignty.

Senior officials say it has been put back to avoid disrupting talks because they believe the EU is prepared to make concessions.

In an attempt to keep the ERG on side, the prime minister has quietly brought back the former Vote Leave aide Oliver Lewis to advise him and the negotiating team. Lewis was deputy to Lord Frost when he struck Boris Johnson’s Christmas Eve deal with Brussels in 2020, but left No 10 early last year. He is credited with devising the key “freedom clause” that persuaded hardline Eurosceptics to back that deal.

Lewis is now acting as an unpaid intermediary with the ERG “to reassure them they are being listened to and are in the loop”, a government source said.

Conversations with key figures in London and Brussels have revealed that both sides think a deal can be done by February to stop any rows disrupting preparations for April’s commemorations of the 25th anniversary of the Good Friday agreement.

The EU is also preparing to give some ground on data-sharing and the role of the European Court of Justice. President Biden warned both Sunak and Liz Truss that he wanted to see the matter resolved before April’s anniversary. Plans for a Biden state visit to tie in with the anniversary depend on a deal being completed.

In a further effort to impress Leave supporters, the prime minister has decided to bring back the Brexit Opportunities Unit to oversee the transfer of retained EU law into domestic legislation.

He will also make a “political appointment” to maximise the “marginal gains” that can be made by tweaking regulations now Britain is outside the EU.

Last night Downing Street denied the bill had been halted. A senior government official said: “To give room to the negotiations we are not asking for the whips to bring it back to the Lords now. We want to give negotiations the best chance. Public discussions of amendments would not be helpful at this stage. We’ll let the team try the negotiations with Brussels first. If that doesn’t work, we’ll do the bill with the Lords.”

Until now the EU has acknowledged the need to discuss how the protocol is operating, but it has not yet conceded that it needs to be rewritten — a fundamental requirement for the UK.

But, under a timeline circulating in Whitehall, the EU would accept the need for text changes over the next two weeks. The two teams would then work flat-out either side of Christmas to prepare for a month of formal negotiations in January.

If all goes well, a draft deal could then be presented to the other key players in the first two weeks of February. The EU would have to secure member states’ support; the British government would need to square things with the ERG and the DUP in Belfast.

Downing Street is adamant Sunak will only do a deal he thinks is right: “We want to have constructive talks, but we will walk away if the agreement is not good enough.”

The prime minister is under pressure from the White House to get the deal done. When he saw Biden at the G20 summit last month, the president stressed he cared about the Good Friday agreement and urged Sunak to find a constructive solution. Sunak replied that he was on the same page and urged the president to help with the deal.

Biden is shortly to appoint a special envoy to Northern Ireland to lean on both sides to settle their differences. US diplomats have bluntly told Brussels to give ground on the need for checks on goods and the UK to drop some of the objections to the role played by the European court in advising adjudicators on EU law.

Senior figures in Brussels have told prominent British politicians that the failure of Truss’s plans for extreme deregulation of the economy to make it a rival to the EU has made them much better disposed to a deal with the UK. “They were worried we were going to be Singapore-on-Thames, and that’s clearly not happening,” a former cabinet minister with close connections to the European Commission said.

A government spokesman said: “The bill has not been paused. It will continue its passage through the Lords in the new year.”

A government source added: “Oliver Lewis is an expert on EU issues, having steered through the Brexit deal in 2020. He has kindly agreed to provide occasional and unpaid advice to ministers.”