Last Friday’s dawn agreement in Brussels, permitting the UK and the European Commission to move to the next stage of the Brexit process, was brought into question very quickly by two of the ultra-Brexiteers in Mrs May’s cabinet.

Environment minister Michael Gove wrote, in the Daily Telegraph on Saturday, that a future UK government could reject any deal arrived at after the next election. His colleague David Davis, the man in charge of the negotiations on the British side, told the BBC on Sunday that they would not pay the exit bill unless the UK got the trade deal it wished for.

Any future government can of course reverse policy, but Gove speaks for the current government and appeared to be repudiating his government’s deal with the EU the day after it was announced.

Davis is quite right to point out that Friday’s agreement is not a ratified international treaty. But he breezily dismissed the detailed 7,200-word EU-UK document as no more than “a statement of intent”.

Rather more

The UK government’s counterparties, the European Union and the 27 member states represented by chief negotiator Michel Barnier, will see it as rather more than a statement of intent.

It was negotiated painfully over many months in order to unlock the next stage (the transition deal) of Brexit, which must be completed before the March 2019 exit date.

Despite Monday’s clarification from Davis, the real significance of the disarray in London is not the legal status of the agreement, it is the credibility of the British government and its capacity to negotiate international agreements at all.

Theresa May has commenced cabinet discussions designed to decide the British government’s negotiating objectives. This will be difficult and could yet split the Conservative party. It is extraordinary that Britain has irrevocably departed the European Union before settling internally on its own objectives. If the hard Brexiteers win the argument in cabinet, the preconditions set down by the EU for moving to the next phase of negotiations will have been breached.

Intention

That next phase will be the withdrawal agreement, the parameters of which were supposedly set in Brussels on 8 December.

The intention had been to wrap up the withdrawal agreement by the autumn of 2018 in time for ratification by the EU27 and the European Parliament, leading to British exit on 29 March 2019, two years to the day after May’s Article 50 notification.

That the British government should have despatched this resignation letter, with a two-year fuse attached, before they had agreed their own negotiating objectives, will puzzle historians for a long time. Negotiations on this withdrawal agreement will commence, barring accidents, early in the New Year.

The UK must then negotiate a transition agreement. This will extend de facto membership of the EU, including the single market and customs union, for a period after Brexit. There is confusion as to when these transition talks can commence, with Mrs May conceding that they might begin only when the withdrawal talks are over, which means late next year.

David Davis, ever the sunny optimist, has asserted that these transition talks can commence as early as March. The British side envisages a two-year transition, which would mean continuing budget payments, free movement and jurisdiction for the European Court until 2021, all anathema to Brexiteers.

The EU and most independent observers think the transition will have to be longer, as much as five years according to some UK business lobby groups.

The transition cannot begin until the UK quits in March 2019 and a long transition is required in order to facilitate negotiation of the UK-EU trade agreement, which cannot be discussed until the UK becomes a third country.

This is where the unresolved inconsistencies in UK policy will have to be addressed. Will the UK continue in the single market and customs union, or will there be a sharp break with Europe, including a hard border in Ireland?

A short transition and a quick wrap-up of the post-Brexit trade talks is only possible with continued membership in both single market and customs union. The Brexiteers prefer a Canada-style free trade agreement which would be the largest and most complex such deal ever negotiated.

Hard borders

The (far more limited) Canada deal took seven years to finalise. Moreover, it is difficult to see how any Canada-style deal would be consistent with the provisions relating to Ireland announced at dawn on 8 December in Brussels. Outside both single market and customs union, the UK will have hard borders not just with Ireland but with all of its former partners in Europe.

The UK has three agreements to negotiate in order to make Brexit a reality – the withdrawal agreement, the transition agreement and the trade agreement. Even the first remains problematic given the confusion in London.

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