Free movement to continue ‘for at least two years after Brexit’

UK government sources suggest Brexit deal may not be fully implemented until 2022

Terminal 2 of Heathrow Airport. Philip Hammond’s transitional deal aims to protect UK economy and reassure businesses. Photograph: Steve Parsons/PA Wire

Terminal 2 of Heathrow Airport. Philip Hammond’s transitional deal aims to protect UK economy and reassure businesses. Photograph: Steve Parsons/PA Wire


The free movement of European Union citizens to Britain will continue for at least two years after Brexit as part of a transitional deal pushed by British chancellor of the exchequer, Philip Hammond.

Marking a significant change in mood around the British Cabinet, senior sources have suggested that a major shift in opinion is under way that will delay the full implementation of a Brexit deal until 2022.

Ministers have accepted that free movement of people from EU countries will have to continue for up to four years after Britain leaves the EU – a divorce due for February 2019.

EU chief negotiator Michel Barnier underlined the need for clarity in talks in Brussels this week with Brexit minister David Davis, warning that progress cannot be made until that happens.

The softer “off the shelf” transition deal now mooted in London has come following weeks of bitter division among British Cabinet ministers, including sustained attacks upon the chancellor of the exchequer, who favours a “soft” Brexit.

The first full round of talks to extricate the United Kingdom from the EU ended in Brussels on Thursday with few compromises and differences over how to protect the future of expatriate citizens.

Britain is due to leave the EU by the end of March 2019, after a June 23rd referendum last year in which many Britons backed Brexit to restrict immigration and regain powers from Brussels.


Some senior members of prime minister Theresa May’s cabinet, including finance minister Philip Hammond, have been pushing for a transitional period designed to protect the economy and reassure businesses.

Under Mr Hammond’s plans, EU citizens would still be able to move to Britain for up to two years, according to the London Times, though the Guardian cited a senior cabinet source as saying free movement could last for up to four years.

Meanwhile, the chief executive of Goldman Sachs International, Richard Gnodde, has urged London to agree a “significant” Brexit transition period as soon as possible, saying that businesses are spending money “every single day” preparing for uncertainty.

Goldman Sachs employs 6,500 people in the UK, and its Brexit contingency plans involve adding hundreds of staff at European bases in cities like Frankfurt and Paris, either by moving them from London or recruiting locally.

Mr Gnodde said London would remain a “very, very significant financial centre” and his company would retain a large presence there regardless of how Brexit negotiations turn out.

But he said Goldman had contingency plans in place to ensure it can continue trading whatever the outcome.

“The other way to describe the contingency plan is that we are buying insurance,” Mr Gnodde said. “I’m spending money every single day to make sure that, come March 2019, I’m open for business.

“If I knew today that we would have a significant transition period I could stop spending that money . . . because I know I would always have time to transition my business.


“If they tell me in February of 2019 there will be a transition period – well, I’ve already spent all that money, it’s not much use to me. At that point the transition period doesn’t really help – so the sooner we know the answer ‘Will there or will there not be a significant transition period?’ that’s obviously helpful to us. The sooner the better.”

Explaining how Goldman was planning for Brexit, Mr Gnodde told the BBC: “We obviously have contingency plans which we’ve prepared. We got on to that right after the referendum, and those are detailed plans and we are moving down a path.

“The one thing I have to ensure is that, come the end of March 2019, we are in a place to service our clients whatever the outcome of negotiation, so we do have those contingency plans.

“We have offices in many European cities right now, we have offices in Paris and Frankfurt and Stockholm and Madrid and Milan, we have banks in Paris and Frankfurt. So we have a broad footprint. We will obviously work to bulk that up somewhat.

“London is going to remain a very, very significant financial centre whatever the outcome of the discussions. We will remain a very significant presence in London. But if the rules require us to have more on the continent, we will have more on the continent.”