13 Mar 2019

Putting Humpty Together Again? What next in the apparently never-ending Brexit saga?

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It was not the best of days for the Prime Minister yesterday. It was something of an achievement last November to conclude a deal with the European Union which did not have the support of the then Brexit Secretary (Dominic Raab), who promptly resigned. It was even more of an act of optimism to declare that you had secured ‘legally binding’ changes to that Withdrawal Agreement only for the Attorney General to announce a matter of hours later that while the documents concerned might have legal standing, they were not sufficiently ‘binding’ to ensure that the United Kingdom could not be trapped in the Irish backstop eternally. At least Geoffrey Cox did not storm out of Cabinet as well.

Once Mr Cox had issued his opinion the game was basically up as far as the second meaningful vote was concerned. The only question was the scale of the defeat. Ministers might draw limited comfort from the fact that it was merely a massive 149 vote margin rather than the utterly crushing 230 vote loss experienced back in January.

This was not an act of utter sabotage by the Attorney General. In fairness to him, there are only two means by which the UK might be certain that it could never be locked into a backstop that it did not like and they are either an explicit unilateral exit clause or a an expiry date, neither of which the European Union were willing to concede either directly or, as the PM had hoped, indirectly by accepting language that was sufficiently ambiguous and flexible that the Government could legitimately read it one way (constraining the impact of the backstop) while the EU-27 could interpret it another (retaining the impact of the backstop).

Absent such terminological innovation, Mr Cox became the domino that did not fall. If he had found in favour of the new deal in terms of its legal effect then the Democratic Unionist Party would have almost certainly endorsed what Theresa May had proposed, and with the DUP on board the European Research Group of MPs would have moved en masse in the same direction. As it turned out, only about one third of those Conservative MPs who had rejected the Withdrawal Agreement in January swapped sides last night.

So, what happens over the next 36 hours or so and possibly after that?

The House of Commons will reject leaving on 29 March without a deal

The motion before MPs for a debate and a decision today rules out a departure from the EU on 29 March without an agreement but notes that, legally, exiting on that date without a deal is the default decision. In order words, the House of Commons would not merely have to disown a no-deal outcome but it would then proactively have to embrace seeking an extension to Article 50 which, if it were not forthcoming from Brussels, would then throw matters back to leaving on time with no deal.

There is not much doubt that the House will reject leaving on 29 March without an accord with the EU. The important and interesting aspect of the votes this evening is the fate of two amendments, assuming that they are selected by the Speaker, whose word on such matters is absolute and final.

The first is in the name of the arch-Brexiteer Steve Baker and backed by an unusual assortment of the ERG, the DUP and some prominent Tory moderates who have been part of the self-styled ‘Malthouse Compromise’ discussions. It accepts the need for a delay beyond 29 March but asks for a 21-month transition period on current terms (with the UK still paying into the EU) to allow time for a ‘managed no-deal’ to be negotiated between the UK and the EU to come into effect in 2021. Much of this management would consist of agreed technological solutions to border/trade issues.

The Baker amendment is very unlikely to pass. The Opposition parties will be overwhelmingly hostile to it and even though it is for the most part a ‘free vote’ with no whipping, those Conservative MPs loyal to the Government will either vote against it or abstain on it. What the final division on it may reveal, however, is the distribution of sentiment within the parliamentary Conservative Party on the ultimate ‘end state’ in terms of the UK’s final relationship with the European Union. Elements of the Malthouse Compromise might, as will be outlined, yet to have a role to play in this process.

The second amendment of consequence has been laid by Labour MP Jack Dromey and Conservative MP Caroline Spelman. This rules out no-deal ‘at any time and under any circumstances’. It has some prominent Conservative supporters (not least Sir Oliver Letwin). If the Labour Party leadership were to decide to back it wholeheartedly then it would have a chance of passage. As this would appear to bind the Government in its future deliberations with the EU, Mrs May has already indicated that this is one element of the vote tonight where Conservative MPs will be whipped to oppose it. Those of a Machiavellian disposition, though, might see advantages to the Prime Minister if were to prevail.

What sort of extension to Article 50 will the Government seek?

Once the possibility of leaving the EU on 29 March has been discarded, the Prime Minister will have to agree a motion for the debate on invoking an extension to Article 50 that would follow tomorrow. This is significant and challenging tactical territory, not least because once again amendments to that motion will be permissible.

Ministers could simply request the endorsement of the House to attempt to extend Article 50 but leave the question of what date might be sought to the Prime Minister. This has obvious appeal but it runs the risk that a majority in the House may vote for an amendment that has a specific date included and thus impose its will on the executive. The constitutional and political implications of Parliament ‘taking back control’ (to borrow a phrase) of this matter are enormous, and both Downing Street and the Whips Office will be desperate to avert that scenario occurring. It is a fine judgement call as to whether to move a motion without a hard date mentioned in it or not.

If ministers decide they want (or need for insurance) a date then that begs two further questions. The first (fairly obviously) is whether to pick a fairly short-term extension (to the end of June, for instance) or a much longer one (the end of December, for example). The difficulty with the short date is what happens if there is still no agreement with the EU by the time that it arrives? Repeated extensions of Article 50 are not really a runner. The conundrum with the longer date is how does the UK avoid participating in the elections for the European Parliament in May, which it should be part of as it would still be a full member of the EU but which would be a pretty farcical and surreal exercise. Legal opinion is split as to whether Parliament can of its own accord legislate not to have that ballot.

The second point to ponder is whether or not to aspire for an extension that expires on a set date or whether instead to ask for an extension ‘up to’ a specified point in the calendar. This is much more significant than it might seem. It holds open the option of leaving earlier than the date that is named in the extension if the House of Commons can embrace a new version of a withdrawal agreement.

Do not rule out the possibility of a third meaningful vote next week

Precisely what the Government decides to do in terms of an Article 50 extension will indicate if it is contemplating a third attempt at passing what in essence is the same Withdrawal Agreement. Mrs May’s best chance of bringing the DUP and ERG into line is if the House makes it apparent that it will not tolerate a no-deal exit (which is why defeat on Dromey/Spelman could end up a blessing), and if it obtains a majority for a comparatively long extension of Article 50 which could be curtailed if and only if the House of Commons were able to agree upon an exit arrangement with the EU-27. Otherwise, full membership would continue as would the chance of a second referendum on Brexit.

What might make the DUP/ERG settle allowing for the reality that the EU will not offer up anything else? Three moves around the approach to the ‘end state’ might have traction. The first would be for ministers to formally abandon or ‘park’ the Chequers Plan agreed last July. The second would be for the Government to adopt aspects of the Malthouse Compromise surrounding the prominence of the application of new technology to address the Irish border question and trade more broadly. The third would be an explicit promise from Mrs May to stand down once Brexit has been secured thus allowing the Conservatives to agree an approach to the ‘end state’ via a leadership election.

It may not be practical to hold a third vote before the EU Council at the end of next week. Yet if a dialogue between sections of the Conservative Party over the coming weekend indicates another vote would actually pass at the third time of asking then, in yet another twist to the tale, it could indeed happen.

Tim Hames
Director General, BVCA


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