Has the death of May’s deal paved the way for a new Brexit approach?

It really is ironic, isn’t it? Despite a third successive Brexit defeat for Theresa May, it seems the fallout has at last paved the way for an alternative approach to the UK’s withdrawal from the European Union.

Friday’s Commons defeat was smaller than those which had come before it on 15 January and 12 March – the majority against Mrs May was 58 rather than 230 and 149. The vote was also confined to the so-called ‘Divorce’ rather than extending to the crucial political declaration. But, even so, the verdict was clear- the vote in its current form is dead and buried.

Given that her deal was likely to lose for a third time, the question has to be asked: why did the prime minister so willingly invite her own humiliation? For a prime minister who, since taking office has faced 35 cabinet resignations, conventional wisdom would surely prevent her from inflicting any more embarrassment upon her stricken premiership.

There are a host of reasons. Her obdurate character, her inept strategy and the seeping political authority. However, perhaps the most crucial reason was to appease the various party wings, and indeed the country, by showing that some kind of Brexit was on the road. But her systematic misjudgements and succumbing to partisanship meant she was unable to meet the deadline of leaving the EU in what she called “an orderly fashion” by 29 March. The prime minister was clearly trying to demonstrate to leave voters that it was everyone else apart from her that was getting in the way of Brexit. Indeed, Mrs May has, throughout the process, tried to turn the spotlight of blame on Labour. But they owed her nothing.

According to Geoffrey Cox, the attorney general, the reason for May trying again was purely a matter of procedure. The prime minister needed to get the deal through so that the latest Brexit deadline could be moved back from 12 April to 22 May which, in theory, would allow Parliament to force through the final furlong of withdrawal legislation and avoid the European parliament elections.

But the PM had more political reasons too. The revolt of MPs last Monday, in which they took control of the parliamentary timetable, opened the possibility that opposition MPs and pro-European Tories might force a soft-Brexit. Many panicked at this prospect, and with Mrs May promising to stand down if her deal was voted through, more than 40 MPs supported a deal they had once fiercely criticised. Even so, it was all to no avail, yet Downing Street seems to suggest that it can rely on those switchers in order to make things easier for the deal if May tries a fourth time.

But a fourth vote would be nonsensical. Instead, Mrs May’s defeat clears the way for an alternative approach. Indeed, this week’s indicative votes – whilst not producing an outright majority – proved that there is a majority for a customs union-orientated solution. With Theresa May having now extended the olive branch to Jeremy Corbyn in order to find common ground, the prospect of either a customs union or second referendum on the final deal are very much in play.

If the Commons can rally behind these then the EU summit – which commences on 10 April – can be asked to give the UK an extension of article 50 to formulate a different form of a withdrawal deal, potentially with a public vote at the end.

Whatever happens in the short-term, maybe, just maybe, Theresa May has kicked the can hard enough to create space for a belated, but much-needed compromise.

Breaking News – May faces second resignation in no-deal protest

Brexit minister Chris Heaton-Harris has resigned in protest over May’s refusal to embrace no-deal.

Heaton-Harris, a devout Brexiter resigned after a day of speculation that he might follow Nigel Adams, who resigned as a junior minister earlier today due to his belief that Theresa May was making a “grave error” in trying to reach out to Jeremy Corbyn.

He outlined in his resignation letter that he though the UK should have left the EU on 29 March, as planned, and that he cannot support any further extension.

One of his main responsibilities as a Brexit minister was no-deal planning. In his resignation letter, Chris Heaton-Harris, says he does not believe that the prime minister is aware of how much has been done within government to prepare the UK for a no-deal scenario

Analysis from Oliver Murphy – Editor

Today marks the thirty-sixth ministerial resignation since Theresa May took office in 2016, and most crucially the dwindling of the prime minister’s political authority.

But of course, charting a course for Brexit has never been a clear-cut exercise. Whether it be a no-deal or soft Brexit, each option risks potentially splitting the cabinet in two.

This latest resignation reaffirms the unrest currently striking the Conservative Party, and the tenuous position May holds as the Prime Minister, as well as further damaging the number of MP’s votes she can rely on to see her planned Brexit deal through Parliament for what could potentially be a fourth time in the coming weeks. Indeed, the warnings of the government chief whip resonates today, as the convention of collective responsibility is tested to its limit.

You don’t love it or hate it but face it, a customs union is the only orderly Brexit

Many expected the deadlock around Brexit to be broken last night. With Labour whipping for 2 soft Brexit proposals, one could be forgiven for believing that the partisan bind which has engulfed Parliament for the last 5 months would, at last, be over. Even though none of the indicative votes gained a majority, there is at last a deal which seems able to command a majority in the Commons

The proposed customs union deal was only 3 votes away from securing a majority- the narrowest of defeats with 273 ‘Ayes’ and 276 ‘Noes’ demonstrating that, what is essentially Labour’s Brexit plan, can muster considerable support in the house.

Labour proved on Monday that it is the only party willing to offer a compromise on Brexit. A lesser party might be expected to have a more obstructionist approach to Brexit, but Labour proved that, unlike the majority in the Commons, it is willing to act like adults and try to reach out. The Conservatives’ ideological purity is now the main block to a sensible Brexit deal. Don’t believe me? Listen to Nick Boles talk about his own (former) party’s Brexit approach.

After yesterday’s infuriatingly narrow defeat, there are many who need to have a long hard look in the mirror and decide what they truly want. Indeed, no more so than the 20 Labour MPs who voted against their own party policy and against the whip on the customs union. They have irrevocably shamed the party, not to mention the country, and I don’t buy that those who represent leave seats were justified in doing so.

They were elected as Labour representatives on a softer Brexit stance; one which advances a Brexit deal based on the protection of workers’ and citizens’ rights as well as preserving this nation’s economy. Labour’s great success in 2017 was partly due to their moderate Brexit stance; a position that was accepted by remainers and leavers alike. Labour’s plan is not a betrayal of the leave vote, far from it. To vote against the plan, while inevitably driving us towards a No Deal is not only irresponsible but also sticking the proverbial two fingers up to the remainers who voted for them in good faith.

You will struggle to find any Labour MP whose votes did not mainly come from remain voters, but these voters have been forgotten by these 20 MPs. The logic of Labour’s Owen Smith, an ardent remainer, voting against such a deal was more ideological purity that the public are so sick of.

While Labour may have had some irresponsible rebels attempting to sully the name of the party, the blame does not lie solely with them. Indeed, other parties were keen not to be outdone in narrow mindedness and ideological purity.

The nationalist parties led the way. Plaid Cymru and the SNP both could have swung the vote. But they abstained. The Green’s sole MP, Caroline Lucas, voted against in another bizarre display of logic from an MP who supports a People’s Vote. It was a classic show of Brexit politicisation: ideology first, consequences second.

With all the power now back in the hands of the Conservatives, these MPs should ask themselves why they voted to increase the chances of a catastrophic No Deal? The scenario reminds me of a situation in The West Wing. A minimum wage amendment gets attached to a vote on the debt ceiling. For those unfamiliar with US politics, by not raising the debt ceiling, the result would most likely be a crash in the world economy.

The question remains: how long can MPs sustain playing this high-stakes game of chicken for. It is clear the Tories want a No Deal. An average of 24 Tory MPs voted for each option last night. It is up to the rest of the parties to govern responsibility and deliver a customs union.

It is a deal that should satisfy those who understand that there will be no unicorns. It delivers tariff free access to the single market, mitigating large economic damage while ending freedom of movement and the jurisdiction of the European Court of Justice in the UK. The compromise for this is ceding control of our common external tariff to the EU, a price that may be worth paying to avoid No Deal. It does not mean we cannot make trade deals, Turkey is in a customs union with the EU but still have trade deals with 3rd party states, but does mean we are restrained by this external tariff. The price for maintaining trade with our largest trading partner and the largest tariff-free market in the world.

If MPs truly want us to leave the EU it is time for them to compromise and end this chaos. Deliver a deal that can get Parliamentary support. A customs union Brexit is the only deal that can get support without heading back to the polls. Without a general election or People’s Vote it must be a customs union Brexit.

Brexit has cost UK economy an average of £600 million a week, top investment firm warns

The investment firm Goldman Sachs has warned its clients that Brexit has impacted the investment finance industry worldwide, and the resulting uncertainty has cost the UK economy £600 million a week on average since 2016.

In a letter sent out to the organisation’s many clients today, the U.S. based firm warned that the current political turmoil caused by Brexit has “had real costs for the UK economy” and that the recent uncertainty around Brexit in Westminster has created a “renewed intensification of Brexit uncertainty.”

The investment firm industry works through directing flows of capital into organisations and industries through the use of investment firms, and the likelihood of investments returning reliable profits influences a large proportion of the industry’s decision-making.

This likelihood of investments providing profits can be inferred by analysts from information relating to the economy, including political, statistical, and world-economic indicators which factor heavily into the decisions made by firms when providing funding for companies.

Brexit and the resulting political turmoil has seen one of the biggest periods of uncertainty in UK economic history, leading many international investment firms to avoid funding business in not only the UK itself, but also other European countries as the full scale of the impact of Brexit on the European financial landscape has not yet been fully realised.

Analysts at Goldman Sachs predict a 15% chance of UK GDP falling by 5.5%, and the blow to confidence in UK markets would see the Great British Pound fall by up to 17%.

The economic uncertainty hasn’t just impacted the economy of the UK, as data released today has also shown that a no-deal Brexit would see the German economy, the flagship financial centre of the European Union, growing half a percentage point slower in the immediate year following a no-deal Brexit due to uncertainty in European markets.

Goldman Sachs’s top analysts also predicted that European countries could see a loss of around 1% in GDP following a no-deal Brexit due to the fallout of a sudden exit.

While still impacting the growth of the UK economy, a Brexit transition deal would lower the financial impacts of Brexit, seeing a 6% rise to the Pound and UK GDP growth increasing by 1.75% in the years following the United Kingdom’s exit from the European Union.

While this scenario would see UK GDP and the Pound increasing in value, the rate of growth would be far less than the growth experienced by a pre-Brexit UK.

The option with the lowest economic impact on UK, and world markets, would be the United Kingdom remaining the the European Union. Should the UK stay in the European Union, the investment firm predicts that the UK would see it’s economy return to the growth experienced before the 2016 vote, and would also potentially see the pound’s value increase by 10%.

The bank also alleviated concerns from other European economies around a transitional Brexit, as the bank believes that only a no-deal scenario would create implications for markets outside of the UK.

If MPs can find a consensus on Brexit, May must accept it to finally end the chaos

With parliament now embarking on finding out if some kind of consensus can be found on what, if any, kind of Brexit the UK has, and with time of the essence, will this process find a way out of the impasse?

The first thing to be said, is that this is a long overdue exercise. The idea of MPs having ‘indicative votes’ has been kicking around for several months now, but has been blocked by the government. At last enough MPs were brave enough to at least try, by voting on Monday to bundle the government out of the way. The government has failed abysmally to come up with a solution that commands a majority in the House of Commons, so they have no call for complaint really.

It is likely, that if this process can indicate a majority for anything, it will be for a ‘soft’ Brexit of some sort. It is the nature of coming to a consensus that movement is made towards the center by the participants, you might not get all you want, but you get something of what you want. A softer Brexit fits that bill, since there does appear to be a majority in parliament against leaving the European Union (EU), without any deal, and probably not enough for re-run of the referendum.

It is still possible that the Prime Minister’s deal will be passed this week, especially if she offers to resign soon, as many hard line Brexiter’s may fear something much softer, and worse in their view, will be emerge from the indicative voting process. If Theresa May’s deal is not passed though, what kind of softer Brexit has a chance of gaining the support of a majority of MPs?

It is likely to look something like Labour’s plan, which in outline would include a customs union with the EU and a ‘close relationship’ with the single market. The EU has made encouraging noises about Labour’s plan, so it is not some pie in the sky type plan which has been repeatedly rejected by the bloc, like the plans of the hard Brexiters. It looks to be a serious proposal, with a good chance of being accepted on the continent.

The problem is, it wears a red rosette, so many Tory MPs may find it unpalatable, humiliating even, to support it. So it will probably stand more chance if it is labelled as something else. It seems to me to be not that far away from what has been called in the past, ‘Norway plus’ or more recently, ‘Common Market 2.’ This plan has the great advantage of being pretty much off the shelf, and with time so short, should not need to take much negotiation. It also solves the problem of what our future relationship with the EU will be, rather than the ‘blind’ option of the Prime Minister’s deal.

What this means in practice is joining the European Free Trade Association (EFTA) and or joining the European Economic Area (EEA), or replicating these arrangements in some sort of bespoke agreement. The UK was a founding member of EFTA in 1960, in what could be viewed as an alternative to the EU (then Common Market) at the time, as France barred our admission to that organization.

It is basically a free trade agreement between member states and with the EU. Other member states are Norway, Switzerland, Iceland and Liechtenstein. ETFA states are not in the Common Agriculture Policy or the Common Fisheries Policy. EFTA states are allowed to conclude trade deals with ‘third party’ states.

The EEA which began in 1994 allows EFTA states to participate in the EU single market, whilst financially contributing to the EU. It includes the four freedoms (the free movement of goods, services, persons and capital), as well as competition and state aid rules. It also includes so-called “horizontal policies”, such as consumer protection, company law, environment, gender equality, health and safety and employment law. Switzerland is a member of EFTA, but not the EEA and has separate bi-lateral agreements with EU on trade and some other matters.  

This type of arrangement will not please everyone, it allows freedom of movement, but also allows for an ‘emergency break’ on immigration. It does mean contributing to the EU budget, although likely a lower amount than now, and does means not having a full say on EU policies, but does allow for consultation on changes to policy.

EFTA has its own court too, which settles disputes between members and the EU, but it does take into account ECJ judgements. One thing that can’t be taken for granted is EFTA/EEA states not wanting the UK to join. At the moment EFTA/EEA members have a combined population of only 14 million people, so a country the size of the UK joining, with a 65 million population, could well unbalance the organization. So, maybe a bespoke version of these agreements is a better option.

It seems to me there is deal in there somewhere that could command a majority in the UK parliament. If this turns out to be the case, the British government should take it. It could be put to a referendum, with Remain as the other option. Everyone has had enough of this Brexit pantomime now, and there are much more important issues to address domestically. It is time we moved on, in a sensible way, and not waste the next five to ten years negotiating what our future relationship will be with the EU.      

May will allegedly quit if ERG vote for her third meaningful vote

A “reliable” source has told ITV Political correspondent Robert Peston that Theresa May has assured the European Research Group, and a number of other Politicians, that she will quit her post as Prime Minister if they vote for her third meaningful vote, which is theorised to be put forward to Parliament on Tuesday with revisions.

A source has told ITV that Theresa May has contacted Boris Johnson, Sir Iain Duncan Smith, Steve Baker, Jacob Rees Mogg, and the Chequers that she will resign as Prime Minister if they vote for her deal, including the controversial backstop arrangement.

The promise allegedly came in a meeting with the Chequers today, following an emergency cabinet meeting this morning.

Theresa May’s Brexit Deal is due to be pushed through Parliament for a third time this week, after the deal was set back by John Bercow last week for being too similar to her second deal, citing a law from 1604 that stopped the same policy being voted on by Parliament in the same sitting.

It is believed that even if the ploy manages to attracted the loyalty of the ERP, the full support of the DUP and even most, if not all, of her own Party’s MPs, the deal will still not pass through parliament.

It is also believed that May will seek to hold a third meaningful vote on her Brexit deal on Tuesday in a final attempt to have her deal passed through Parliament before the withdrawal deadline on the 28th of March.

Speaker denies May a third meaningful vote on Brexit Deal

The speaker of the house, John Bercow, has denied Theresa May a third vote on her Brexit Deal without changes to her Motion, it has been revealed today.

Bercow has stated that he will not allow a third vote on a motion that was described as “substantially the same” motion that MPs rejected last week.

The Speaker has cited a parliamentary law, created in 1604, that a defeated motion is not allowed by be brought back to be discussed and voted for in parliament during the course of the same parliamentary session.

Bercow had previously called the second vote on May’s deal as different enough to be “in order”, but that further motions must be different enough to be classified as a new motion.

The announcement comes following another round of humiliating votes in parliament against the current Government, with the Conservative Party whipping MPs against a motion the Party itself had put forward for a vote, with MPs eventually deciding overwhelmingly to delay Brexit past the March 29th deadline for Article 50 if a deal cannot be agreed to before then.

Bercow’s statement comes as another setback among many for May’s Brexit Deal, which must now be agreed to by the 29th of March to save another blow to the Government when it will be obligated to ask the European Union for an extension to Article 50.

There are a number of theoretically possible ways to move around the denial by the Speaker of the House, and the former Attorney General, Dominic Grieve, suggested that a substantial difference to the Deal could be to ask Parliament to also vote for putting the deal to a referendum. Another possibility would be to change the Parliament, calling a full general election and possibly changing the Speak of the House role itself, a position John Bercow has held for almost 10 years.

Commons votes to seek extension to Article 50

The House of Commons has passed a bill that seeks to extend Article 50 to give it more time to get a deal with the EU.

The bill passed with a majority of 210.

The bill hopes to secure an extension to Article 50 and therefore avoid a No Deal Brexit. The bill seeks to put May’s deal before the Commons again before March 20th, should it pass at the 3rd time of asking the UK would seek an extension till June 20th.

If May’s plan is voted down again the UK will need a legitimate reason accepted by the EU to extend Article 50 for a longer period. This will means the UK would need to take part in EU Parliamentary elections.

Without changes to the backstop May’s deal is unlikely to pass and should the bill pass tonight the UK would be left in the EU for the majority of 2019. While Donald Tusk has said he will “appeal to the EU27 to be open to a long extension if the UK finds it necessary to rethink its Brexit strategy and build consensus around it,”.. It is clear the UK will need to rethink its strategy suggesting that May would need to drop some of her red lines or head back to the people in one form or the other. Some Brexiteers have suggested they will lobby EU head of state’s to veto such an extension to force no deal.

Benn’s amendment that would have seen the Commons take control of Brexit briefly to host so-called “indicative votes” that would give MPs an idea which deals have the chance of making it through Parliament was defeated by 2 votes. However, The government announced it will hold “indicative votes” should a long extension be secured.