George Pascoe–Watson: May’s gamble fails

Theresa May will soldier on as a broken–backed Prime Minister facing the prospect of her government collapsing at any moment.

She will become a “caretaker PM” – forming a feeble administration with the help of the Democratic Unionist Party and seek to run the country on a day–to–day basis.

Let’s be clear: the British government could fall on any single vote on any single night.

Worse still, she will become bogged down in the Lords because she now has no mandate under the “Salisbury Convention” which means she cannot push through her manifesto in the face of opposition from Peers.

She faces two enormous challenges: staving off a leadership challenge from her own Party, and successfully negotiating Britain’s exit from the European Union while ensuring her government doesn’t fall.

Cabinet ministers were this morning describing Mrs May’s decision to continue as the “least unpalatable of all unpalatable options”. Intriguingly, no minister has emerged either to support her staying or calling for her head.

The implications of the Conservative Party’s General Election implosion are only just being considered by the most senior figures in British politics.

Immediately she must appoint a government with significantly different figures than she had intended.

She will have to balance the Cabinet as much as is possible, with Brexiteers and Remainers taking equal power.

Chancellor Philip Hammond is now likely to stay.

But she will come under immense pressure to dispense one or both of her chiefs of staff, who are already carrying the blame for Thursday’s catastrophe.

Many are already expecting that there will be no prospect of Britain paying off its deficit in the medium term.

Indeed, the chances are that Mrs May will have to open the public purse strings to try and keep millions of disgruntled voters at bay.

She will face enormous demands from public sector workers for an end to pay freezes. And she will have little ability to say “no”.

Teaching and health unions may well be the first to move, but expect similar demands from fire and police unions and others.

On Brexit, she will face enormous pain.

The 60 or so hardcore Brexiteers on her backbenches will push for a complete exit from the customs union and single market with no recourse to the European Court of Justice.

But the Remainers in her party will stand firm. She has no room to manoeuvre in any Commons vote. So remain MPs will still block their Brexit–supporting colleagues’ demands.

Mrs May will have to draw up policies for a Queen’s Speech – focusing on counter–terrorism, and the Great Repeal Bill.

But it will have to be empty on detail so she can force it through the Commons and then the Lords where there will be pitched battles.

And then there’s her leadership.

It is beyond doubt that senior figures in her Party will have an eye to the succession. There are already talks going on in some camps.

She may try to position herself as a caretaker until March 2019, offering a leadership change beyond then once Britain leaves the EU.

That would pave the way for a General Election in the summer of 2019 with the new Prime Minister presiding over Britain’s new deal with Brussels and the rest of the world.

But she would be relying on a lot of good will. The Conservative Party is utterly ruthless when it comes to choosing a leader.

Perhaps her greatest hope is making it clear to Tories that a leadership contest now would lead to a collapse of her government, a fresh General Election and a Jeremy Corbyn Premiership.

Victoria Dean: Implications for Brexit

In many ways a hung parliament is the very worst possible outcome for the UK’s Brexit negotiations. Like everything else, Brexit has been flung into uncertainty, and there are now many many questions.

The first question chronologically is whether or not negotiations can realistically commence in formal terms on 19 June. There are hints overnight from Brussels that it might be necessary to delay. That outcome will irk Berlin and Paris no end. They – along with other EU counterparts – feel that they have already been waiting long enough to get on with this negotiation which they feel is hanging over their heads. They’ve already had to wait for the PM to invoke Article 50 … and then for the UK to hold an election … and now this. French PM Macron and German Europe Minister Roth have both issued statements this morning indicating that the Article 50 process should continue as planned, regardless of the result in the UK.

On the other hand, there are some European voices already now calling for a pause or a time–out in the negotiations. It should be in the interests of nobody to hold the UK to a timetable solely for the sake of it.

European Commission Juncker on the other hand has so far steadfastly avoided commenting on the UK’s election outcome, instead pressing ahead with strengthening the EU’s defence cooperation (and aiming to maintain EU unity, by showing the Union can deliver).

So here’s where it gets complicated legally, as well as politically. Is a pause possible, and if so how, and until when? Is an extension to the negotiating period, requested by the UK and agreed to by the 27 EU Member states, the right route? Or would rescinding the Article 50 letter, to be reissued once a government commands a majority, be an option? Can the British privately persuade France and Germany that it is in everyone’s interests to find a way to make a time out work? Remember though that there are strong voices on both sides in the UK, and in the new Parliament. That gives the PM very little wriggle room in either direction on this. And we already have a trend in the UK of using the courts to challenge decisions around Article 50. Remember Gina Miller and the Supreme Court hearing?

In the longer term, the big question is what kind of Brexit is now on the cards. The voting pattern across the UK indicates a rejection by voters of a so–called hard Brexit. David Davis himself said in the days before the election that he and the Conservatives were putting to the electorate the choice of a UK coming out of the single market and the customs union and it would be up to the people to decide. It seems they have. So perhaps the interest in that type of deal has weakened here in the UK.

But by throwing the country into political chaos with a hung parliament, the likelihood of getting one has potentially increased. Although the substance of the Brexit negotiations remains unchanged, the atmospherics of the negotiation – which are critical – have shifted irrevocably. This PM, perhaps in charge of a very weak minority government, cannot be taken seriously in Brussels as a tough negotiator with the people behind her. That means she will find it very difficult, if not impossible, to deliver a good deal for the UK (even if she survives) … and potentially makes a deal in Brussels’ interest more likely and easier for them to deliver.

On the other hand, although the pathway isn’t clear, there are those who hope that this offers a window of opportunity to review the UK’s decision to exit the EU. Younger people are more energised than they were last year (evidenced by their voter turnout), hard Brexiteers haven’t necessarily all done well in this election and some of the more moderate voices may find renewed vigour.

Victoria Dean is a Partner, leading Portland’s Brexit unit. She joined Portland after nearly 20 years in the diplomatic service, most recently as British High Commissioner to the Eastern Caribbean.

John Clark & Emma O’Dwyer: Labour’s future

A new dawn has broken has it not? Maybe not quite. However, it has inside the Labour Party. Jeremy Corbyn was seen jigging his way into 105 Victoria Street this morning flanked by a ginger looking Labour Party General Secretary – one Iain McNicol.

Staff at Labour HQ are already discussing their futures. Most are incumbents from the pre–Corbyn era. They recognise Corbyn has won a significant moral victory within the party. Their view is that because he performed well above expectations this will give his team a new mandate to push them out. They foresee a move against McNicol, and ultimately redundancies for ‘moderate’ staff.

The last vanguard, the National Executive Committee, the party’s top decision making body, had been set to block the ‘McDonnell amendment’. This move aims to reduce the number of nominations needed from MPs to stand for leader – paving the way for a far–left successor to Jeremy.

The NEC may block it still. However, this result and increased enthusiasm from activists means there is now a new, longer term, game of building the votes and support to implement change in the party over the coming years.

After what should have been a disastrous election for Corbyn, many were expecting his departure in the near future. Now, they have as long as Corbyn can hold onto the job to make the party in their image. This delays any recovery of the party by its centrist wing, has blunted hopes of ousting Corbyn, and sets the scene for a long war of attrition.

As evidence of this, Chuka Umunna – expected to launch a bid for the leadership – made a statement saying he would now willingly serve in the Shadow Cabinet. Furthermore, on the back of their increased majorities, we are unlikely to hear calls for a split anytime soon.

John Clarke is an Associate Director, and Emma O’Dwyer is an Senior Account Executive at Portland.

Zoe Brennan: The waning influence of the press

It was the night the press lost the plot. Yesterday, Fleet Street threw its weight behind the Conservatives, with most British newspapers supporting the Tories.

The Sun proclaimed: ‘We’ve had enough of Jezza’s rubbish…Vote Tory. Don’t Chuck Britain in the Cor–Bin’.

The Daily Mail appealed to the nation to vote tactically for the Tories and Brexit. The day before, it attacked Labour over 13 pages, under the headline: ‘Apologists for terror’.

The Times reported that Theresa May could expect a 50–seat majority, with The Evening Standard, Daily Express, The Daily Telegraph and Financial Times supporting the Conservatives.

The Mirror and Guardian stuck with Labour, but their support was limp compared to the pro–Tory roar from the rest of the press.

The polls seemed clear, and it was merely a matter of thinking up some clever Theresa May victory puns.

That is obviously not what happened. Not only did the press not predict the result, the swing to Labour shows that they did not influence the vote.

Newspapers expect to hold huge sway in elections. But it seems that the tide has turned for the press.

The notorious 1992 Sun headline ‘It’s the Sun Wot Won It’ set the tone for newspapers’ election coverage, after John Major won an unexpected victory over Neil Kinnock.

The headline has gone down in UK newspaper folklore – although Rupert Murdoch has since described it as ‘tasteless and wrong’.

Brash, maybe – but that Sun headline contained some truth. Now, the electorate gets its information from a wide range of digital sources.

Guardian columnist Owen Jones said last night that the British commentariat got it wrong ‘and have to show some humility’.

That is not on the cards. The press will dust itself off and regroup. But it will perhaps never again enter an election with such certainty that it can predict or shape the result.

Zoe Brennan is a Partner at Portland, and Head of Writing. During her 20 years in journalism, she was Westminster correspondent at The Sunday Times, and senior feature writer at The Daily Mail.

Shane Finnegan: A surprise opportunity for the DUP

As was the case in GB, Northern Ireland saw an under–pressure leader make a significant statement to her political opponents last night.  Arlene Foster, the former First Minister led her Party into this election needing to right a very poor performance in the Assembly elections in March, following the fall of devolution as a result of her perceived role in the RHI scandal.

Following last night’s election which saw the DUP having its best Westminster result ever, with 10 MPs elected, the DUP and Mrs Foster have been quick to point out the political pendulum has shifted in their favour.  The DUP increased its seats by two, with their vote increasing by 10.3%.  Sinn Fein also had a good night picking up an additional three seats for a combined seven, up 4.9%.

However, while the DUP is potentially moving towards a confidence and supply arrangement with the Conservatives, Sinn Fein will come under further pressure for not taking their seats at Westminster. This is a position that would set the party into an unprecedented crisis should it ever change – this was the party’s founding principle. 

As for Arlene Foster and the DUP, the threat to the Union was their main message on the doorstep on two counts.  1. Sinn Fein’s rise in the Assembly election in March. 2. The potential impact of Brexit on the Irish border, the subsequent calls for a border poll and, until last night, the onward march of the Scottish nationalists.

Sinn Fein, while celebrating their result, will be reeling from the position that the DUP now finds itself in with the influence they will have over the new Government and the Prime Minister.  Their calls that the Secretary of State is not being an honest broker in Northern Ireland will reach fever pitch.

The DUP will make a statement later today and have stated that ‘soundings having taken place but talk of a deal is premature’.

As for Mrs Foster her asks of the government will be:

• A soft border, a relaxed approach to the customs union but she does not want special status for Northern Ireland, something all other political parties’ other than the Ulster Unionists have been calling for

• No trade border between NI / ROI or a border of any shape or form between GB and NI.

• While she wants the best of both worlds, this will be hard to achieve.

• The union was the main rallying call for the DUP in this election and she will be looking to ensure that the Conservatives do not relent on a border poll and support the relationship between GB and NI in every way possible.

• Further investment in Northern Ireland’s infrastructure, particularly DUP–held constituencies.

• She will also seek to use this new–found status to put pressure on SF and others to form a new Assembly at Stormont

Shane Finnegan is Client Director at AIKEN, an independent communications agency with offices in Belfast and Dublin.

Gregor Poynton: Political gravity hits the SNP

After the stratospheric results the SNP achieved in 2015 it was likely, if not even inevitable, that political gravity would kick in. Last night they came back to earth with a bump.

Defeats for Angus Robertson, their well–regarded Westminster leader and depute leader, Alex Salmond, the former First Minister, and a third of their group of MPs would have been unthinkable even a month or so ago. For sure this election has been a chastening experience for the First Minister and the SNP.

The real winner in Scotland last night was Ruth Davidson’s Conservatives. The Scottish Tory leader who has, again, been enhanced by an election campaign led the charge against a second independence referendum and reaped the benefit taking 13 seats. In fact this Scottish Tory revival has given Theresa May the edge in seats by which she is looking to hold onto the keys to No 10.

With spectre of a second referendum dominating the voters’ minds in Scotland, the pro–union parties focussed their campaigns relentlessly on that and the voters responded.

After a bit of confusion over messaging it seems like the word from the SNP is indyref2 is off the table, for now. This may satisfy the majority of the population but will store up problems for Nicola Sturgeon as she seeks to manage the fervent pro indyref2 wing of her party.

The first sign of how this will play out will be in the race to be the SNP’s new depute leader. They will also need a new Westminster leader. The smart money is on Tommy Shepherd for one or both of those roles. He’s close to the grassroots and not as tight with Nicola Sturgeon as Angus Robertson, although none of the current Westminster group is as close to the all–powerful party hierarchy as the man they will replace.

The SNP and First Minister still dominate Scottish politics. But a second independence referendum looks further away than it has done since September 2014 and – whisper it – after 10 years of an SNP Scottish Government, we may have reached peak Nat.

Gregor Poynton is a Partner at Portland and leads the Content & Brand practice.