Brexit Update 7th June 2019

By June 21, 2019 Brexit Updates

Top 3 developments

  • The 1922 Backbench Committee changed the Conservative leadership rules to speed up the leadership contest and be able to select a new party leader by the 23rd July deadline.
  • Boris Johnson is currently leading the leadership contest with public support from 42 MPs and the US President Donald Trump.
  • Donald Trump visited the UK this week and raised plans for a post-Brexit trade deal with the US.

UK Update

Raising the bar or trimming the fat?

With 13 Conservative MPs putting themselves forward for the leadership contest beginning on the 10th June, the 1922 Backbench Committee has reviewed the rules of the leadership contest to ensure that a new party leader will be elected by 23rd July.

Previous rules dictated that an MP only needed the backing of a proposer and a seconder to run in a leadership contest. Then there would be a series of exhaustive ballots, with the bottom-ranked candidate eliminated each time until there were only two left, with this ballot then being opened to the Conservative membership. Now, however, not only does the candidate need a proposer and a seconder but also the support of another six MPs, making eight supporters in total. The candidates with eight votes or more will then move onto a series of exhaustive ballots. At the first round of ballots, any candidate with 16 votes or fewer will be eliminated. On the second ballot, any candidate with 32 votes or fewer will be eliminated. The final process of the wider Conservative membership voting on the final two candidates remains the same and this will be completed in the week beginning July 22nd.

The new rules will definitely speed up the election process as two of the 13 candidates have already backed out from the contest. James Cleverly claimed that MPs were not yet ready to support a newer candidate, having only been elected in 2015. Kit Malthouse also resigned from the race because of the existing “appetite for this contest to be over quickly and for the nation to have a new leader in place as soon as possible”. It is expected that this number will continue to decrease before Monday as five of the remaining eleven MPs (Mark Harper, Esther McVey, Rory Stewart, Andrea Leadsom and Sam Gyimah) are not thought to have enough support from MPs to make it to the first round of exhaustive ballots. This would leave Boris Johnson (who already has 42 public endorsements from MPs), Michael Gove, Jeremy Hunt, Dominic Raab, Sajid Javid and Matt Hancock left in the race.

Once a new leader has been selected by the Tory membership the Queen will ask them to form a new administration. There is no requirement for confirmation by Parliament, but the new Prime Minister will need to quickly shore up the alliance with the Democratic Unionist Party, which provides the Conservatives with a majority and who are already calling for the new leader to seek alternative agreements to the Brexit backstop plan. If the winner looks like they do not have the support of MPs then opposition leader Jeremy Corbyn is very likely to call a no-confidence vote, which, if won, would lead to a general election. This would plunge the UK into a further state of chaos and increase the possibility of a further Brexit delay.

Ahead of the pack with the help of Sunak

Boris Johnson is currently leading the leadership race in terms of MP backers by a margin of 14, although the contest does not officially begin until Monday. Johnson’s most significant endorsements were given this week by Rishi Sunak, Robert Jenrick and Oliver Dowden. Whilst these might not be the most widely known members of the Conservative Party, they have risen through the ranks as MPs all elected since 2014 who have already become ministers. The main reason that this is an important endorsement is because they represent moderate centrist Conservative MPs, which demonstrates that Johnson is reaching beyond the right of the Conservative Party into the centre, and suggests that his attempts to position himself as a ‘one nation’ may be successful.

It has been suggested that one of the main reasons that Conservative MPs are supporting Johnson over other candidates is because they believe that he would be a good match against Corbyn during a general election, following his successful election campaigns for Mayor of London. These MPs might not necessarily believe that Johnson could be a great success in Brexit negotiations, but rather that he could lead the party to victory against Labour and save them their seats.

(No) Brexit Party

In news that seems to have shocked much of Westminster, Labour held Peterborough in last night’s by-election. The by-election was called in Peterborough as the previous Labour MP has been jailed for lying about speeding points. It was anticipated that Mike Greene would win the seat for the Brexit Party, following their success in the European elections and because 61% of the constituency voted for Leave during the 2016 Referendum. It was expected that this would be another opportunity for voters to express their frustration with both the Labour and Conservative parties by electing the Brexit Party and giving them their first seat in Westminster. However, this prediction never came to light and instead Lisa Forbes, who has recently endorsed antisemitic Facebook posts, won the by-election with 31% of the votes, compared to the Brexit Party’s 29%.

America First (in line to dismantle the NHS)

After all the bad news about the UK’s inability to secure a Brexit deal, President Trump’s state visit brought along some optimism about the UK economy’s future by promising a ‘phenomenal’ trade deal with the US. However, this hyperbolic language was soon overshadowed by Trump’s comments that the NHS would form part of future trade negotiations. For a man who campaigned to always put America First, there have always been lingering doubts about whether a UK-US trade deal could ever be mutually beneficial, or whether it would always ultimately be unfairly skewered in the US’ favour.

In many ways this statement is not surprising. For US pharmaceutical companies, the NHS has always been a glittering jewel of an export market, and the US pharmaceutical lobby are notorious for their political influence in Washington. But it reveals further tension between the political relationship between the US and the UK, as there is also absolutely no doubt that this statement would definitely not have been cleared by Number 10. The NHS evokes passion in UK citizens that most closely resembles religious fervour, and Theresa May knows this better than anyone. Trump’s comments provoked a huge outcry amongst the public, and Conservative leadership candidates lined up to condemn his comments, knowing that it is an easy way to score points with the Conservative membership – who unlike US conservatives generally do not view universal healthcare unfavourably. Trump, who appeared confused by the question when he made his initial remarks, soon backtracked on his comments and stated that the NHS would not be on the table as he does not consider it ‘part of trade’.

But regardless of Trump’s backtrack, it is possible that this issue will return when formal discussions begin for a UK-US trade deal. It is clear that no Conservative leader in the future would sign up to this trade deal. Our recent negotiations with the EU have proven that the UK faces great challenges in terms of trade negotiations as it looks towards its post-Brexit future. A US trade deal – with its chlorinated chicken and possible impact on the NHS – may well prove to be politically toxic, so post-Brexit Britain may well have to look initially to other less affluent partners to secure trade deals.

EU Update

Take your pick

It was reported this week that France and Germany have clashed over their favoured choice to succeed Jean-Claude Juncker as President of the EU Commission, the Executive arm of the EU. German Chancellor Angela Merkel favours Manfred Weber, the German candidate from the European People’s Party (EPP) – the largest grouping within the European Parliament. Traditionally, the representative of the largest party usually secures the nomination, but considering the EPP only has 180 seats in the 751 seat Parliament, it shouldn’t be assumed that the same thing will happen this time around. French President Emmanuel Macron clearly did not agree with this assumption, as when he was questioned on his preferred candidate for the nomination, he listed three names, none of which were Manfred Weber.

Getting your favoured leader chosen is a marker of your influence in the EU. One of the main indications of the UK’s waning power in the EU was in 2014 when David Cameron opposed Juncker’s appointment and unsuccessfully tried to stop him from being elected. Much has been made of Merkel and Macron both flexing their muscles to prove their influence within the bloc, and this contest should be viewed within the same spectrum. Merkel is out to secure her legacy and Macron is out to assert his ambitions to reform the EU. Close attention should be paid to who supported the next EU Commission President, as it will be the clearest indication as to who the real power is in the bloc: Macron or Merkel?

Upcoming Key Dates

  • 7th June: Theresa May’s departure date.
  • 10th June: Leadership battle begins.
  • 23rd June: Three year anniversary of Referendum.
  • 30th June: Brexit review if the UK is still a member of the EU.
  • 23rd July: Leader of Conservative Party is elected.
  • 31st October: Current Brexit Deadline.

 

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