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22 March 2019

Edelman Brexit Bulletin: Chaos? Uncertainty? Meltdown? Delay? Where next for London and Brussels…

Brexit, Government Affairs

At the end of another momentous week in the Brexit soap-opera of news, only two things appear certain. Mrs May is still the Prime Minister, just about, and we are no longer leaving the EU on 29 March – a week from now. But everything else is still it seems up for grabs – a no deal Brexit, an exit in the coming weeks both with and potentially without a deal, a third meaningful vote, a series of Commons votes on alternative Brexits, a softer Brexit, a short delay, a long delay, an indefinite delay, a general election, no Brexit at all, even a second referendum.

But make no mistake, the Brexit debate has fractured British politics and divided the British people. It also threatens potentially in the next week or so to rip the governing party asunder. Earlier this week the PM told the public that she was “on your side”. The bad news for her is that the people appear to disagree. The bad news for her political opponents is the public don’t think they are doing any better.  

When asked by pollsters whether the PM or Parliament was on the side of the people a remarkable 60% said neither were. That damning indictment is a product of two years of negotiation and months of deadlock at Westminster. 

Here’s our analysis of what happened, why it matters and what might come next after a remarkable 24 hours…

What happened? 

  • Last night the European Council, minus Theresa May, agreed to a time-limited extension of Article 50, with several potential options in play.
  • If MPs back Mrs May’s Brexit deal next week at the third time of asking, then Article 50 will be extended until 22 May at the latest in order for the necessary implementing legislation to be passed. Notably, the Council conclusions only made specific reference to the Commons approving the Withdrawal Agreement rather than the wider package also comprising the Political Declaration on the future relationship.
  • If MPs were to reject the deal again, or indeed just the Withdrawal Agreement, then the extension will run until 12 April. At this point, we could still end up with a no deal Brexit although this would not be automatic, with the EU indicating that it would be for the UK to indicate an alternative way forward, potentially at an emergency summit.
  • Therefore, attention is increasingly focusing on Parliament holding a range of ‘indicative votes’ in an effort to determine whether a majority could be found for any alternative approach. In her press conference last night, Mrs May indicated the Government would allow these votes to be held. Mr Kwarteng went further, saying he would “be surprised” if Conservative MPs were not given a free vote.
  • Any extension beyond 22 May would require the UK to confirm by 12 April that it would take part in the European elections scheduled for 23 May. Mrs May has said that she is strongly opposed to UK participation in these elections, but she has not categorically ruled it out.
  • In addition, the European Council formally confirmed the additional safeguards negotiated by the UK and the European Commission last week which provided further assurances that the UK would not become permanently trapped in the Irish border backstop. The EU also said that any unilateral UK guarantees offered to Northern Ireland via the so-called ‘Stormont lock’ would need to be within both the spirit and letter of the Withdrawal Agreement.
  • The Government will hope that these developments will prove sufficient for Speaker John Bercow to conclude that the proposition before MPs is materially different. Speaking in the Commons today, Brexit Minister Kwasi Kwarteng said that the Government “fully intends to have a meaningful vote next week” but he could not confirm for definite.
  • Following last night summit, the Danish Prime Minister Lars Løkke Rasmussen said that the EU had given the UK the “opportunity to rethink the whole thing…. what we made gives UK best opportunities to decide their own destiny. If they don’t want a hard Brexit and want to redefine their own red lines and negotiate a whole new package, that’s a possibility.”

What does it mean?

  • Brexit now been delayed until 12 April at the earliest. This change will need to be pulled through into UK domestic law via a Statutory Instrument amending the 2018 EU (Withdrawal) Act, but even in the highly unlikely event this does not take place, the date of 29 March has now been legally superseded by last night’s agreement which is binding in international law.
  • However, the extension does not in of itself get us any closer to finding a viable solution to the political impasse; it still appears unlikely that Mrs May will be able to overturn last week’s 149 vote defeat into a victory for her deal at the third time of asking, with the DUP’s Nigel Dodds issuing a statement this afternoon indicating the deal as it stands is still unacceptable.
  • The comments of EU leaders and senior EU officials indicate they are aware that in the absence of decisive leadership from Prime Minister Theresa May a resolution to the impasse may only from placing the onus on Parliament.
  • This means that many are now looking to the indicative votes to provide the elusive breakthrough, however it is not necessarily clear that there is a parliamentary majority for any alternative plan either. For example, a softer Brexit could be taken to mean a customs union, full membership of the single market and a customs union, a ‘close’ relationship with the single market etc. Some Labour MPs, above all in Leave seats may back a customs union but be very wary of continued free movement. 
  • However, the EU’s suggestion that the Withdrawal Agreement could be approved on separately from the Political Declaration does open a potential scenario in which a majority can be found for the former with Labour votes; the party’s policy is to seek changes to the latter. 
  • However, there is the political question of what Mrs May would do in the event that there were a very narrow majority in the Commons as a whole in favour of a softer Brexit but a strong majority against that option within the Conservative Party. Adopting such an approach could not only collapse the Government if Brexiteer Ministers refuse to go along with it, but also split the wider party, a scenario Mrs May is desperate to avoid.
  • As such, a snap General Election to try to break the impasse cannot be entirely ruled out, although the time required to run the campaign would also necessitate the UK taking part in European elections, a scenario most MPs committed to Brexit in principle will want to avoid.  

What happens next?

  • On Monday, MPs will debate a motion affirming the Article 50 extension and the plan to bring forward the required Statutory Instrument to formally change the specified UK Brexit date in domestic legislation.
  • A number of amendments to this motion have already been tabled, with the most popular of those so far being an amendment tabled by Tory MP Oliver Letwin with cross-party support to lay out the procedure for a series of indicative votes to determine what would happen if MPs reject the Government’s Brexit plan again.
  • If approved, these votes would be held on Wednesday 27 March. However, the Government could pre-empt this potential defeat by tabling its own indicative votes proposal.
  • The third meaningful vote on the Brexit deal (or potentially only the Withdrawal Agreement element of it), is expected next week, but this has not yet been confirmed. Monday’s Brexit motion will likely set to outline the timetable for this and any further procedural steps which may be required to prevent a no deal Brexit on 12 April.

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