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Malthouse Compromise: all you need to know

Theresa Villiers, Nicky Morgan, Damian Green, Iain Duncan Smith and Owen Paterson leave the Cabinet Office in Westminster
Theresa Villiers, Nicky Morgan, Damian Green, Iain Duncan Smith and Owen Paterson leave the Cabinet Office in Westminster

By Harriet Line

Q. How did the plan come about?

A. Housing minister Kit Malthouse brought Remain and Leave-supporting Tories together in a bid to break the Brexit impasse - concocting the plan which now bears his name. Unlikely bedfellows including Nicky Morgan, Jacob Rees-Mogg and Steve Baker held secret talks for "some days" - and brokered the plan over a chocolate orange.

Q. What does the "Malthouse Compromise" propose?

A.The plan contains two choices to be offered to the EU: one for how the UK will leave with a deal, and one for how it will leave without. Plan A is similar to the current Withdrawal Agreement, but with changes to the Irish backstop and the implementation period. Plan B assumes that agreement on the Withdrawal Agreement is not possible and creates a "transitional standstill period".

Q. How is plan A different to the current deal on offer?

A. The bare bones of the Withdrawal Agreement remain the same, but the implementation period would be extended until no later than December 2021. The aim of this is to provide a longer period to agree the future relationship, but it could also involve paying more money to the EU. The second major difference is to the controversial backstop, which would be changed to become a "basic free trade agreement".

Q. Is plan B different to a no-deal Brexit?

A. Yes as Britain would remain in a transition period even if a Withdrawal Agreement had not been signed. The UK would become a third country, in practice, but would offer to pay the EU in exchange for retaining the implementation period until no later than December 2021. Plan A would remain on offer as long as the EU was willing to consider it.

Q. How much would the UK have to pay?

A. Under plan B, Britain would offer £10 billion per year in exchange for the implementation period to continue.

Q. When would Britain leave the EU under the plan?

A. Brexit would still occur on March 29 under both plans, but the major difference is that the UK could stay in a transition period until December 2021 under both.

Q. What happens next?

A. The AAWG is expected to meet at least twice more this week, but it is unclear whether Brussels will accept the proposals. Deputy Brexit negotiator Sabine Weyand has said technology would not solve the border issue "in the next few years".

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