Aiken PR

The Briefing

Update and Analysis of the Current Brexit Environment

by Aiken PR

13/12/2018

An update and analysis of the current Brexit environment

What did Teresa May have to concede to secure the vote?

The Prime Minister has bought herself a little time, potentially a few more weeks but she had to concede to delivering major changes to the withdrawal agreement and a commitment that she would not stand as leader in the next general election.

Her victory last night means she cannot face another challenge to her position as Tory leader for one year.  However, many Conservative MPs do not want Theresa May to fight another general election as leader, after her disastrous performance in the 2017 campaign and the concession that she will not stand was a considerable gain for her internal opponents.

Mrs May is in Brussells today to talk to EU leaders about and is seeking to renegotiate / reassurance over the Northern Ireland backstop.

She stated last night that she had listened and that ‘I will be seeking legal and political assurances that will assuage the concerns that members of parliament have on that issue’,

After meeting The Prime Minister yesterday Leader of the DUP Arlene Foster said ‘We emphasised that tinkering around the edges would not work. We were not seeking assurances or promises. We wanted fundamental legal text changes’.

Many are pessimistic about the prospects of Mrs May making dramatic progress in her talks with Brussels to persuade the right of her party that she can ‘bin the backstop’.

The measure of her task was outlined by European Commission President Jean–Claude Juncker and Taoiseach Leo Varadkar stating that they were open to engagement but that the UK’s Withdrawal Agreement ‘cannot be reopened or contradicted’.

EU leaders are planning to issue a statement after the summit in a bid to support Mrs May when she returns to Parliament in a bid to pass the Withdrawal Agreement by January 21st.

This statement is expected to say the EU will ‘use its best endeavours to negotiate and conclude expeditiously a subsequent agreement that would replace the backstop and that they’ll pledge to explore further assurances if needed’.

It is expected that without renegotiation, the backstop will endure, and Brexiteers will not vote for it.

 

House of Commons no confidence?

Mrs May still faces a potential no–confidence motion in the House of Commons, which could bring her government down if backed by more than half of all MPs.

Shadow chancellor John McDonnell has suggested that Labour could call the motion next week if Mrs May does not get changes to the Withdrawal Agreement that are required.


What does all this mean for the meaningful vote & Brexit timeline?

No 10 has promised that the vote will happen before 21 January, which in negotiating terms provides very little time. So the Brexit fundamentals at Westminster remain, for now, unchanged.

The vote is a legal obligation under the UK’s 2018 EU Withdrawal Act, which says it must take place “before the European Parliament decides whether it consents to the withdrawal agreement being concluded on behalf of the EU”. However, January 21 is not a legal deadline: the withdrawal act only requires a vote by that date if the government has been unable to agree a deal with the EU. 

Mrs May’s November agreement with the EU means that technically that provision no longer applies. But Downing Street said that sticking to the deadline would mean she was abiding by “the spirit of the law”. Because of the parliamentary recess, the most likely time for a vote is between January 7 and 21.

If Mrs May is defeated in a meaningful vote on her deal, the government will have to report back on its plans for next steps within 21 days, according to the EU Withdrawal Act and that would be by February 11th.


Parliament takes back control / No deal / Referendum?

A defeat for Mrs May’s deal could represent the opportunity for parliament, in which the majority is against a hard Brexit, to take a greater role.

Following a Commons defeat for the government, MPs will be able to assert their point of view by amending the new plans set out by the government whether to come out against a no–deal Brexit, call for a second referendum or recommend Norway–style membership of the EU’s single market.

In these scenarios, most notably a referendum, an extension to the date of March 29th would be a likely requirement. It has been mooted that a special EU summit could be held in January to assess the situation and to agree on a prolongation beyond 29 March 2019 but this would be far from certain.

Theresa May stated on the steps of Downing Street yesterday that if there was any new leader they would have to scrap or extend article 50, ‘delaying or even stopping Brexit’.

Brussels has repeatedly warned it would not accept an extension of the two–year negotiating period to simply allow a ‘managed no–deal’.


January – February Deal passed into UK law?

If, by contrast, the Commons approves the Brexit deal in a meaningful vote, the government will put forward a new piece of legislation: the EU (Withdrawal Agreement) Bill. This would pass into law some of Brexit’s biggest issues, such as the agreement on citizens’ rights, the financial settlement and the details of the transition. It would be a hugely consequential piece of legislation with many battles on individual details.

Until March 29 2019 EU ratification?

Before any Brexit deal can take effect, it must also be approved by the European Parliament in a plenary vote. Any legally questionable elements of the withdrawal treaty could also be referred to the ECJ by MEPs. EU member states must also give the deal final approval in a ministerial meeting.

March 29 2019 Brexit day?

If the process enables this is the date of Brexit day. Depending on progress or lack thereof this could produce a seamless transition or, if they fail to yield any deal, a much more chaotic cliff–edge Brexit. The chaotic events of recent days have significantly increased the possibility of Brexit not being extended beyond March 29. The rest of the EU can grant such a request by unanimity. At present Mrs May’s government is still insisting that Brexit will take place as scheduled on March 29.

Extending UK membership beyond the date of May 23–26 European Parliament elections could also be problematic for the EU. One last alternative is that the UK could revoke its Article 50 notification and opt to remain in the EU for good. The European Court of Justice ruled in December that Britain could still make such a unilateral volte–face. But despite growing calls for a second referendum, including within Westminster, Downing Street continues to reject this as an option.

However, the People’s Vote/Second Referendum is very much in play. One version of a second referendum would see voters asked whether they want to leave or remain in the EU, a second question on whether they would like Theresa May’s deal, or a no–deal Brexit as well as the potential for people to state their first and second preference .  Referenda experts have said the whole process, if it were agreed, would take a minimum of five months.  Many reject this as a significant breach of democracy while supporters claim people were uninformed in 2016 and need to make an informed judgement.

The Labour party’s John McDonald has said they are open to a people’s vote, however, they would prefer to contest a General Election.  The Liberal Democrats and the SNP support a peoples vote. Much of this depends on the pressure applied by Corbyn and the Labour party.


After March 30 2019 Trade talks and transition?

Working on the basis that Brexit has taken place on March 29th, fully fledged trade talks would begin between the UK and the EU. While the UK remained a member state, such talks were not permitted under EU law.  Under the deal reached in principle in 2018, this is when the 21–month transition period would begin. During this time most aspects of UK membership of the EU will remain in place, including free movement across borders and membership of the customs union and single market. But the UK will no longer have a vote.

 

December 31 2020  An end to transition?

The transition period is scheduled to end on this date, although that could be changed, according to the draft withdrawal treaty. The problem is that some EU negotiators doubt that a full UK–EU trade deal will be agreed by this point, or for some time to come, given the protracted nature of such talks. Michel Barnier, the EU’s chief negotiator, has now suggested that the transition could be extended up to December 31 2022.

 

December 31 2022  Entering the backstop?

The provisional withdrawal treaty, prior to Mrs May seeking to renegotiate makes clear that if, at the end of the transition, no deal is in place to avoid a hard border with Northern Ireland, then backstop will automatically kick in.

If this element of the deal were to remain relatively intact it would keep the UK in a ‘temporary’ customs union with the EU, with Northern Ireland being more deeply integrated. It is the view of the DUP, Brexiteers and others in parliament that the backstop would impact the integrity of the UK, increasing the EU’s impact on issues such as tax, state aid, and labour and environmental regulation, and provides no guaranteed date for exit.

 

Mid 2020s Journey’s end?

Many business leaders suggest that the ‘maximum facilitation’ plan favoured by some Brexiters that would rely on advanced technology to speed up customs clearances and so exit the backstop would need years to put in place.  A less ambitious ‘fast–track’ system on the US–Canada border took decades to develop and billions of dollars in investment.