EU on notice as Brexit Britain takes control of business aid as huge bloc backlash feared

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The new plan being brought to parliament today will replace European Union government subsidy rules after Brexit. It promises to provide for “timely and effective” government subsidies for private businesses, without sparking bidding wars between different parts of the UK. But speaking to France24, reporter Simon Carroll warned viewers of another possible UK-EU conflict as a result of the plans. He stressed the new system will be watched closely by Brussels, as London has agreed to certain limits on government subsidies to business in its post-Brexit trade deal.

Business Minister Kwasi Kwarteng explained: “The new rules will allow for government subsidies to be used in cases where it is good value for money.

“And helps to meet the Government’s targets.”

These targets include efforts to decarbonise the economy and make Britain greener.

The Government also argues the new rules will provide timely and effective support for businesses when it is needed.

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The plans also aim to ban bidding wars between regions in the UK.

Along with this, a new subsidy advice unit is being set up as the new rules come into force.

It is hoped the government will also save money by stopping money flowing into failing businesses.

Reporter Stephen Carroll was asked how the new plans could trigger a nasty response from Brussels.

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He replied: “Because the EU has very strict rules in this area and the whole issue of what is called the level playing field.

“It is one of the really important issues in the negotiations about that post-Brexit trade deal between the EU and UK.

“Before Brexit, the European Commission had to approve any state aid that was given over €200,000. 

“In the trade deal signed on Christmas Eve, both sides have agreed to prohibit certain kinds of subsidies including to failing business.

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“And to have an independent body to supervise subsidies after Brexit.”

He went on to speculate how Brussels will be increasingly concerned about Britain’s new control over its business aid.

Mr Carroll stressed: “Brussels will be watching very closely to see how these rules play out.”

He said they will be doing this “to ensure the British government its side of the bargain.”

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