Brexit Update – 2nd February 2017

By February 3, 2017Brexit Updates

Top 3 Developments

  • Recycled Paper: the much-awaited Brexit white paper was published today revisiting many of the themes explored in the Prime Minister’s recent speech and attracting the ire of opposition politicians who dismissed its content or bemoaned its late timing.
  • Clear division: MPs voted resoundingly in favour of giving the PM the power to trigger Article 50 but the vote saw 47 Labour MPs defy the party leadership and vote against the Bill, which now moves onto Committee Stage to face several amendments from MPs.
  • Beware the 9th of March: There is speculation that so long as the Bill passes the Lords in early March, the Prime Minister will trigger Article 50 on the first day of the European Council meeting – March 9th.

Clearer steer for Brexiteers

The Brexiteers have it, the Brexiteers have it

After seventeen hours of debate, MPs voted in favour of giving the Prime Minister the power to trigger Article 50 and begin the negotiations for the UK to leave the European Union by a margin of 498 to 114.

Despite a three-line whip on the vote, 47 Labour MPs voted against the bill, including ten Junior Ministers and three party whips ultimately leading to a likely reshuffle. Shadow Chancellor John McDonnell hinted that rebels outside the frontbench team may not be punished. Europe, an issue which for decades has divided the Conservative Party only saw one Tory MP, Europhile Ken Clarke MP, vote against the Government.

The Bill will now move to Committee Stage, where MPs can table procedural amendments which may force the Government to be more upfront about their Brexit plans.

Not white what MPs were hoping for

The Government today published their much-awaited Brexit white paper, reiterating much of the Prime Minister’s recent speech and laying out the Government’s twelve negotiating principles including migration control and control over British laws.

The paper attempts to ease anxieties, pledging that London will remain a pre-eminent global financial centre and to keep doors open to international talent. However, it provides no further information on the future legal status of EU nationals living in the UK or British expats abroad, much to the chagrin of the House. MPs on both sides of the House, during the Brexit debate, implored Government to unilaterally guarantee the rights of EU citizens to remain in the UK upon the introduction of the White Paper.

Despite many calls for a white paper, opposition MPs widely criticised its contents and the timing of its publication. Labour argued that the paper ‘says nothing’ and had been produced too late for meaningful scrutiny. The SNP went further arguing that the Government was deliberately seeking to avoid parliamentary scrutiny.

May marches forward on 9th March?

This week the Times reported that the Government is intending to trigger Article 50 and begin the formal Brexit withdrawal process on March 9. The Government is keen to have the European Union (Notification of Withdrawal) Bill approved on March 7 and is also keen to avoid triggering Article 50 in the last week of March – March 25 is the 60th anniversary of the Treaty of Rome (the founding charter of the organisation which would later become the EU).

Carney’s Michael Fish Moment

Today the Governor of the Bank of England, Mark Carney, announced that the Bank had again upgraded their 2017 growth forecast to 2% for this year (having previously upgraded their forecast from 0.8% to 1.4%, in November). The news will have no doubt emboldened Brexiteers.

Article 50 Bill to be followed by big Brexit bill

Roger That

The UK’s former ambassador to the EU Sir Ivan Rogers, who resigned in January, appeared before the Commons European Scrutiny Committee this week, stressing that Brexit negotiations will be “humungous” and complicated, on a scale “that we haven’t experienced ever, certainly not since the Second World War”

He also revealed that senior figures in the European Commission were indicating that the UK should pay the EU between €40-60bn to leave and reiterated his opinions regarding the timescales on negotiating a free trade agreement, stating that this could take until the mid-2020s to agree. Sir Ivan also highlighted that negotiations are unlikely to remain confidential, explaining that Brussels is “very leaky” and “stuff will get out”.

The (Lord) Price is Right

Minister of State for trade policy, Lord Price, suggested to a German newspaper that the UK will quit the Customs Union. Price told Die Welt that the UK Government understood the EU position that they will not allow any ‘cherry picking’ of the current tariff-free system for goods. The Minister’s comments indicate that the customs will instead have to be covered as part of a comprehensive free-trade deal with the remaining 27 EU Member States. The development follows Theresa May’s statement in her major speech that the UK might become an ‘associate member’ of the Customs Union, although there was confusion as to what exactly this meant at the time.

Sturgeon ultimatum

During discussions with the Prime Minister, Sturgeon issued an ultimatum – giving Theresa May a two-month deadline to compromise over Brexit and hinting that a second independence vote would be called otherwise. Sturgeon, who has grown incredibly impatient with the lack of progress during the discussions, has made it clear that she does not want to see Scotland removed from the single market. A referendum announcement could come as early as the SNP’s spring conference in March. The Defence Secretary Michael Fallon threatened to provoke a row, implying that the UK government would block such plans.

No say for the devolved

At a Joint Ministerial Committee meeting this week, Theresa May told the devolved administrations that they would not be given a decisive role in the UK’s withdrawal from the EU. The statement follows the production of plans by the Welsh and Scottish governments on how they could keep full access to the Single Market. It was not all bad news for the devolved administrations, however, as May stated that she would “intensify” work on their proposals for Brexit.

European Update

London, the power capital of the EU 

A leaked European parliamentary committee report has warned that a badly designed final Brexit deal, which would result in financial services companies choosing the leave the UK, could damage the UK and the other 27 EU Member States. The report will have heartened Ministers who have worried about the sector suffering after Brexit.

Trump trumps Ireland 

Theresa May reiterated her desire to see a “seamless, frictionless border” between Northern Ireland and the Republic of Ireland in a visit to the Irish Prime Minister on Monday. She caused upset after not accepting an invitation to address the Irish Parliament during her visit. Having rushed to visit America, it seems that the same warmth was not necessarily shown to her Irish counterpart.

Merkel meets her match?

The former EU Parliament president, Martin Schulz, has announced he will try and unseat Angela Merkel in the September election. Merkel’s standing has suffered especially after what many perceived an ‘open-door’ immigration policy.

Timeline

6, 7 & 8 February: House of Commons Committee Stage of the European Union (Notification of Withdrawal) Bill 2016-17 begins

8 February Commons Report Stage and Third Reading of the European Union (Notification of Withdrawal) Bill

9th March Possible date that UK Government triggers Article 50

9th / 10th March European Council meeting