May builds new-look Brexit cabinet to
steer EU divorce
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[July 15, 2016]
By William James and Kylie MacLellan
LONDON (Reuters) - New Prime Minister
Theresa May ruthlessly overhauled the British cabinet on Thursday,
sacking a raft of ministers, promoting loyalists and putting supporters
of Britain's exit from the European Union firmly in charge of
negotiating its terms.
A day after replacing David Cameron, May told the head of the European
Commission that Britain needed time to determine its negotiating
strategy, brushing off pressure from European leaders to swiftly launch
the two-year official exit process.
Her most contentious appointment is Foreign Secretary Boris Johnson,
accused by his French counterpart Jean-Marc Ayrault on Thursday of lying
to Britons in the run-up to last month's shock referendum vote to leave
the 28-nation EU.
Johnson, who during the campaign compared the bloc's aims to those of
Hitler and Napoleon, told reporters that despite Brexit, Britain could
play an even greater role in Europe.
"There's a massive difference between leaving the EU and our relations
with Europe, which if anything I think are going to be intensified," he
told reporters.
Three weeks after the referendum, May's new government faces the
formidably complex task of extricating Britain from the EU - itself
reeling from the shock of Brexit - while trying to protect the economy
from feared disruption to confidence, trade and investment.
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The Bank of England kept interest rates unchanged on Thursday,
wrong-footing many investors who had expected the first cut in more than
seven years. But it said it was likely to deliver a stimulus in three
weeks' time to support the economy, once it has assessed the fallout
from the June 23 vote.
The pound rose on the news but is still down 11 percent since the night
of the referendum.
New finance minister Philip Hammond signaled he would take a less
aggressive approach to cutting the budget deficit than his predecessor
George Osborne, who was dumped on Wednesday, just hours after May
stepped into Number 10 Downing Street.
"Markets do need signals of reassurance, they need to know that we will
do whatever is necessary to keep the economy on track," Hammond said.
"Of course we've got to reduce the deficit further but looking at how
and when and at what pace we do that ... is something that we now need
to consider in the light of the new circumstances that the economy is
facing."
CABINET CLEAROUT
Veteran right-wingers David Davis and Liam Fox - both ardent campaigners
for Brexit - have been named as cabinet secretary for exiting the EU and
head of a new international trade department, key positions in the
arduous negotiations ahead.
Along with Johnson's appointment, that means prominent advocates of
Brexit will have the main roles negotiating its terms, forcing them to
take responsibility for delivering on campaign promises to maintain
access to Europe's free trade area while imposing controls on
immigration.
May gave the farming ministry to Andrea Leadsom, another Brexit
campaigner who had run against her for the Conservative party
leadership. Leadsom will now face the task of determining how farmers
will replace lost EU agriculture subsidy income.
Britons chose Brexit despite a barrage of warnings that severing EU ties
would create huge uncertainty and plunge the economy into recession. The
winning 'Leave' campaign dismissed what it called 'Project Fear', saying
Britain would prosper if it regained independence from Brussels.
One of the first economic indicators to capture the post-referendum mood
showed on Thursday that British consumer confidence fell sharply after
the vote. The Thomson Reuters/Ipsos Primary Consumer Sentiment Index
fell to 49.4 in July from last month's 51.2.
"It's too early for most people to experience any direct economic
impacts from Brexit, but fear for the future is clearly being felt by
many," said Bobby Duffy, managing director of public affairs at Ipsos
MORI.
May's swift dismissal of finance minister Osborne was a firm break with
Cameron's administration. Osborne was the architect of austerity
policies and a leading voice among those who had warned that leaving the
EU would spell economic doom.
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![](../images/071516PICS/news_u37.jpg)
Britain's Prime Minister Theresa May arrives at 10 Downing Street,
in central London July 14, 2016. REUTERS/Paul Hackett
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On Thursday she followed up by removing the justice, education,
culture and cabinet office ministers, an unusually high toll of
sackings for a British cabinet shakeup.
Work and pensions minister Stephen Crabb, who had also sought the
prime minister's job, resigned citing family reasons, days after
hitting front pages for allegedly sending flirtatious messages to a
young woman despite being married. The Northern Ireland minister
also quit.
"Brexiteers" Chris Grayling and Priti Patel won cabinet jobs in a
sign of May's intent to unite the divided governing body and show
that, despite having favored the losing Remain side, she will
implement the instructions of the electorate.
NO HURRY
EU countries have pressed Britain to move quickly to initiate the
two-year divorce process to lift uncertainty. But Cameron's
government drew up no contingency plans for the prospect that he
could lose his referendum campaign to stay in.
May's spokeswoman said she had spoken by phone to European
Commission head Jean-Claude Juncker, explaining that Britain would
not be triggering the exit process immediately.
"The prime minister explained that we would need some time to
prepare for the negotiations," the spokeswoman said.
She also spoke to U.S. President Barack Obama, underlining Britain's
commitment to sustaining the countries' "special relationship" and
partnership on intelligence-sharing.
Obama had urged British voters before the referendum to stay in the
EU, for which he was criticized during the campaign by Johnson, who
suggested the U.S. president had inherited anti-British views from
his Kenyan father.
That was just one of many undiplomatic comments over Johnson's
career that made his appointment as foreign secretary the biggest
surprise of the cabinet shakeup.
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He was the figurehead of the successful Leave campaign, but since
the referendum had suffered widespread criticism and ridicule for
failing to present a clear Brexit plan and swiftly dropped out of
the leadership race won by May.
With his unkempt blonde hair, bumbling humor and penchant for
gaffes, he is a colorful but contentious choice for conducting
sensitive diplomacy with world leaders.
"Clearly British humor has no borders," tweeted former Belgian Prime
Minister Guy Verhofstadt.
French Foreign Minister Ayrault was blunt: "I am not at all worried
about Boris Johnson, but ... during the campaign he lied a lot to
the British people and now it is he who has his back against the
wall."
Asked about the remark, Johnson shrugged it off: "I have to say that
the gentleman you mentioned, the French foreign minister, in fact
has sent me a charming letter just a couple of hours ago saying how
much he looked forward to working together and to deepening
Anglo-French cooperation."
(Additional reporting by Kate Holton, Costas Pitas, William
Schomberg, David Milliken, Andy Bruce, Karin Strohecker, Michael
Holden, Paul Sandle and Ana Nicolaci da Costa; Writing by Mark
Trevelyan; editing by Peter Graff)
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