Brexit Update 18th October 2019

By November 1, 2019 Brexit Updates

Top 3 developments

  • The UK Government and EU have agreed a new exit deal to allow the UK to leave on October 31st.
  • The UK Parliament will sit tomorrow, the first time since the Falklands War, to vote on Johnson’s new deal.
  • Boris Johnson is attempting to woo DUP MPs and Labour rebels for the deal to pass through Parliament.

UK Update

Getting This Done

Yesterday, both the Prime Minister and the President of the European Commission confirmed via Twitter that a new Brexit deal has been reached. Boris Johnson stated, “We’ve got a great new deal that takes back control – now Parliament should get Brexit done on Saturday”, with Jean-Claude Juncker describing the deal as “a fair and balanced agreement for the EU and the UK”. The deal was subsequently endorsed by the EU Council at the summit yesterday. In comments yesterday, Juncker also suggested that a further Brexit extension would not be possible.

This is a power move from Boris Johnson as, should the deal fail to pass through Parliament and the UK leaves the EU without a deal, it will be the fault of Parliament not Government. This would definitely be something that would be used by Johnson during the next election campaign, that he was able to deliver a new deal for the UK to leave the EU by October 31st but Parliament was the roadblock that caused a no deal.

However, the Prime Minister’s has not gained the support of the DUP, who have heavily criticised it and Johnson’s approach. This is unsurprising given that the new deal contains a consent mechanism (requiring only a simple majority) which is designed to give Northern Ireland a say on following EU rules and regulations after the end of the transition period. As the DUP no longer has a majority in the assembly, this is seen as problematic as they will not be allowed to veto any proposals. Additionally, Northern Ireland politicians would only be consulted on the deal four years after it has come into effect. That means that the province would be aligning itself with the EU until 2024, at the very least, before being given a say on its future. Yet, from the point of view of moderate unionists in Northern Ireland, this appears to be a good deal and may affect the DUP’s standing should they vote against the deal tomorrow.

The leadership of the Labour Party remains opposed to the deal and has described it as “an even worse deal than Theresa May’s”, though in reality not much has changed from May’s deal. Jeremy Corbyn has hinted that the party will support a second referendum, stating that “the best way to get Brexit sorted is to give the people the final say in a public vote”. However, reports suggest that six of the nineteen Labour MPs (who recently wrote a joint letter urging support for a deal) have already indicated that they will back the deal, with a handful suggesting that they may vote against it as they have unresolved issues with it. Reports suggest that the Prime Minister needs to win over 35 or the current 55 undecided votes in order for the deal to pass through Parliament.

The Government’s attention has now turned to spending the next 24 hours negotiating with Arlene Foster, leader of the DUP, Labour rebels, and the so-called ERG ‘spartans’ (who voted against May’s deal three times) in order to secure a majority for the deal.

New Deal or Old Deal?

In reality, the new Brexit deal is largely unchanged from the one that Theresa May originally negotiated with Brussels, which is less than what Johnson implied when he promised the public a new deal. The Withdrawal Agreement and Political Declaration still contain promises of continued cooperation on defence, crime and space development, with suggestion of the UK participating in the European Space Agency.

Additionally, the previous deal stated that the future relationship must “ensure open and fair competition”, with the newer version acknowledging that “given the European Union and the United Kingdom’s geographic proximity and economic interdependence, the future relationship must ensure open and fair competition encompassing robust commitments to ensure a level playing field”. This is a slightly watered-down version, but essentially unchanged, and was a major concession from Johnson after he was warned by Angela Merkel, the German Chancellor, that the EU would not accept the UK separating regulatory standards from the EU.

The free trade agreement initially suggests a lessening of ties between Britain and the EU than the “close economic partnership” envisaged by May when she was Prime Minister. However, the new Withdraw Agreement still contains the commitments for such an economic partnership made by May, in addition to the free trade agreement. The new agreement contains a change of language to appear to suggest a shift away when the core principles of the agreement remains the same.

The notable changes made to the deal consist of the element of consent from Northern Ireland, which is an entirely new aspect to the deal, and that only Northern Ireland is remaining in the customs union, as opposed to the whole of the United Kingdom, as May originally planned. Boris Johnson has, also, removed the UK’s commitment to aligning with EU rules in relevant areas, suggesting that in areas such as financial or digital regulation the UK reserves the right to make its own regulation. However, should the UK shift away from the EU dramatically then it would affect the level of market access UK firms would get in any trade deal and therefore is unlikely to differ too much.

Brexit or Bust on Super Saturday

After three and a half years the decision for the UK to leave the EU may finally be delivered this weekend. Parliament will be sitting on Saturday – the first sitting Saturday since the Falklands War – and MPs will vote on the PM’s updated Withdrawal Agreement. Unlike Theresa May’s three failed attempts to get a deal through Parliament, this time there is a serious chance that this deal might pass.

The Parliamentary arithmetic facing Johnson in Parliament is tough. At present he has most of the Conservative Party on board, but most Labour MPs as well as the Lib Dems, SNP and DUP are all opposing the deal. Johnson has around 290 MPs committed to supporting his deal, which means that he needs to find an extra 30 MPs to support him to win a Parliamentary majority (320 votes). There are approximately 55 MPs who are undecided at the moment, so Johnson will need to win the majority of these MPs over to succeed in passing his deal. There are three camps where he can find these votes.

The first group are the European Research Group, or the ‘Spartans’ as they like to call themselves. These are the hard-line Conservative Brexiteers that repeatedly rejected Theresa May’s deal. The most important MPs here are the 28 ERG members that opposed May’s deal the third time round. However, their former leader Jacob Rees Mogg is in Government and Boris is a Brexiteer, so the resistance has waned. Most of the ERG have confirmed that Boris’ withdrawal agreement passes the ‘smell test’, which means that it delivers Brexit properly in their view. Steve Baker, the leader of the group, has indicated his support for the deal and it is likely that most MPs will follow suit. However, there remain concerns that some of these MPs are so committed to no-deal that they won’t support any deal put in front of them. Many of these MPs also followed the DUP in their voting, and as the unionists are opposing this deal this could lead to some MPs rejecting it. Expect most of the 28 MPs to vote for the deal, but a few to remain unconvinced. Boris still needs more votes to get a deal over the line.

The second group are the 21 MPs that were expelled from the Conservatives for supporting the Benn Act. 17 of these MPs voted for Theresa May’s deal the third time, and there is an indication that most of these MPs will vote for Boris’ deal. These Tories are primarily opponents of no-deal, rather than ardent Remainers, and most will be pragmatic and support the deal – especially if Boris promises that the whip will be restored to them if they fall into line, which would be very handy to them with a General Election looming. Some of these MPs have confirmed that they will support a deal, but about 15 or so remain undecided. It is predicted that about 17 or 18 MPs of these MPs will back the deal, with only committed supporters of a second referendum such as Justine Greening and Guto Bebb standing firm. While this is promising, Boris still needs more votes.

Finally, and perhaps the toughest group to convince, are the Labour moderates in leave voting seats. Earlier this month, 19 Labour MPs led by Caroline Flint and Stephen Kinnock, wrote to Donald Tusk and Jean-Claude Juncker suggesting that they would back a deal if it was reached. These MPs have indicated they would support a deal to avoid a no-deal Brexit, and as many represent leave voting seats they are also representing the interests of their constituents. Boris is currently in the middle of a charm offensive to convince these MPs to back a deal. There have been reports that about 10-15 of these MPs will support the deal, but the internal pressures that these MPs will be facing from the Labour Party shouldn’t be underestimated. The choice that these MPs face therefore is between Party and their constituents. If Boris gets these 10-15 votes, then it may be enough. But these votes are anything but confirmed at this time.

The conclusion here is that this vote will be extremely tight. It will almost certainly decided by less than 10 votes. At present it could go either way, with both sides being optimistic that they will be victorious. But the success of this deal will ultimately come down to the votes of the hardest Brexiteers and the most moderate Labour MPs. These MPs will go to bed tonight knowing that their vote might make all the difference.

If At First You Don’t Succeed…

Supporters of the ‘People’s Vote’ had originally promised to table an amendment to the Withdrawal Agreement for a Second Referendum. However, reports now suggest that such an amendment is being withdrawn due to suspected lack of support for the move. There is conflict over whether this move has been due to lack of support from Conservative rebels and former Conservative MPs or whether it is because the move does not formally have the support of Labour leader, Jeremy Corbyn.

Corbyn stated that rather than campaigning for a referendum, his first priority is to vote down Johnson’s deal. Apparently, after these comments, pro-Remain MPs have now argued that it would be better to table the amendment at a later date, in order to gain support from soft Brexit MPs, if the deal fails to pass through Parliament.

This lack of commitment from Corbyn is likely to cause significant issues for the public, given the expectation of a large People’s Vote protest in Westminster tomorrow. It is likely that these members of the public will feel let down and abandoned by MPs who have committed themselves to campaigning for a second referendum. As a no deal is still on the table, the public may believe that this would be the perfect time to table an amendment for a second referendum and give the opportunity of remaining in the EU.

Yet, if the deal does not pass through Parliament, then there is still the possibility that Remain MPs could seize control of the order paper via an SO24 debate to table the amendment there and then. With the time limit and pressure of the UK leaving without a deal, it is unclear whether MPs will pass this deal through Parliament to avoid a no deal.

EU Update

Sauerkraut and Brexit deal on the menu for EU leaders

The EU are famous for thrashing out deals at the very last minute, and the new Withdrawal Agreement absolutely lived up to expectations. Just over a week ago, when all hope seemed lost with a Brexit deal, Boris Johnson and Irish Taioseach Leo Varadkar agreed upon a pathway towards an agreement that was subsequently actioned by UK and EU negotiators. A deal was needed to be agreed at the EU Summit on Thursday 17th October, and the final text was not agreed until that morning, so it is safe to say that this agreement came down to the wire.

On the Wednesday evening, significant hurdles remained towards agreeing a deal and hopes were dashed by the DUP failing to support the new concessions made by the UK. Chief Negotiators David Frost and Michel Barnier and their teams negotiated long into the night and into the next morning to thrash out the final details of the deal. At 6:30am on Thursday, the decision was made to go ahead and finalise the deal without the support of the DUP, who did not budge in their opposition to a lack of an effective veto on the border arrangements and had persisting concerns about the VAT regime in Northern Ireland. However, on Thursday morning a deal was agreed by the UK and EU.

The deal was presented to EU leaders on Thursday, and was warmly endorsed by the EU Commission and EU Council. Outgoing Commission President Jean Claude Juncker confirmed that this deal was the bedrock for an ambitious free trade agreement between the UK and EU in the future, beyond the implementation period. He will be satisfied that he can leave his post as President knowing that the new Commission President will not have Brexit at the top of her in-tray on the 1st November. Leo Varadkar supported the deal, and expressed relief that the EU can move on from Brexit. The EU kingmakers Angela Merkel and Emmanuel Macron were also supportive of the deal, knowing that it did not betray any of the EU’s red lines and more importantly, got this issue over and done with so that they can refocus on the EU project without the Brexit distraction. However, they will all have the lingering thought in their head that this is not over yet, and that the crunch time for this deal will be on Saturday in the UK Parliament.

Extension Rebellion

As well as securing a deal with Brussels, a process which has taken three years and two different Prime Minister’s, Boris Johnson also managed to convince the President of the European Commission, Jean-Claude Juncker, to rule out granting an extension to the UK after October 31st. This seems to be a tactical move to persuade Parliament to vote for Johnson’s deal to avoid a no deal, something that the UK Parliament has frequently and aggressively campaigned against.

However, there does appear to be a divide within Brussels over the extension as Donald Tusk, President of the European Council, made clear that should MPs want a Brexit delay the EU would consider the request if it was made. Additionally, sources report that no European leader has reached the point of wanting to veto an extension and that the EU is still committed to hold an emergency summit on 28th October to agree a third delay to Brexit.

These comments are extremely significant as it would allow the UK Parliament time to negotiate another deal or hold a second referendum, as some Labour MPs are suggesting, without Britain leaving without a deal on October 31st. Reports suggest that some Conservative rebels are still requesting that the Prime Minister seeks an extension as an insurance policy against a no deal, should the deal not pass through Parliament.

Though Johnson is still obliged through the Benn Act to seek an extension until 31st January 2020, he has frequently stated that he will not request an extension. Brussels is prepared for such a scenario and, reportedly, is ready to grant a request by a representative of the Government. Additionally, Brussels may allow the extension to go further than January 2020 to allow more time for either a General Election or Second Referendum and for the political chaos in London to calm down, ensuring a greater chance of a deal passing through Parliament. Johnson remains hopeful that his new deal will pass through Parliament and if that is the case then the dilemma of an extension request will be void and UK will leave the EU on October 31st.

Upcoming Key Dates

  • 19th October: Parliament sits and deadline of the Benn Act.
  • 31st October: Current Brexit Deadline.
  • 31st January 2020: Proposed Brexit deadline, if Article 50 is extended.

 

*If you would like to receive these updates when they are sent, please contact Michaela@political-intelligence.com