Skip to main content

Brexit Update

After a week in which the Prime Minister went down to the second worst parliamentary defeat in History, lost the loyalty of the Cabinet, lost control of her whipping operation and lost her voice, Theresa May is still standing and is in better position than she has been for months.

This seemingly contradictory state of affairs has come about because, three years after the referendum, two years after triggering Article 50 and four months after the Government agreed a deal with the European Union, this was the week that Parliament finally got serious about working out the future direction of the country.

The American President Lyndon Johnson is credited with the advice that if you want to get on in politics you have to ‘learn to count’. This week saw the brute force of parliamentary arithmetic come in to play. Mrs May’s deal was defeated by what used to be called the ‘Eurosceptic’ wing of her party (on Tuesday) but crucially they themselves were then defeated even more heavily, twice, in votes which opposed No Deal (Wednesday) and called for an extension (Thursday). There was a chastening defeat too for supporters of a Peoples Vote. So, with proponents from the two ends of the Brexit spectrum licking their wounds attention is once again back on the middle.

There are two potential middle-ways. The PM’s Deal, which looks set to be voted on again next week, possibly on Tuesday, and an as yet still nebulous, set of options based around a softer Brexit called either Common Market 2.0 or Norway+. This would require cross party working, inimical to many Conservatives including up to now the PM, but would attract widespread support on the Labour side of the House. A motion to start this process, proposed by Hilary Benn, was defeated on Thursday, but only by a majority of 2. Its clearly still in play.

The PM will believe that she can persuade enough Conservative MP’s, and of course the DUP, that the only way ahead is one of these options and that hers is the ‘Harder’ path, so that reality will bite, and they will back her through gritted teeth.

From the point of view of manufactures the most attractive thing about the PM’s deal is that it guarantees a transition period which will avoid the tribulations of No Deal and get the negotiations about the future trading arrangement, the so-called ‘Deep and Special’ partnership of to a good start. A softer Brexit deal would have a transition too, possibly by way of the UK joining either temporarily or permanently the EEA (Norway, Iceland, Liechtenstein). Both options minimise disruption and will keep supply chains relatively intact. The MTA will continue to press for an outcome which fulfils these aims.

It looks a complete mess. It is a complete mess. The PM has been humiliated in ways unknown to all of her recent predecessors. The concept of Cabinet collective responsibility – that they agree a position in private and stick to it in public – has been battered (a low point being the Brexit Secretary formally commending a Government motion, in this case ask for an extension, and then voting against it). What it means for the future of this Government and indeed the government of the UK in general is still unknown. The PM will surely struggle to maintain her position until the end of the year, her authority is draining away like water in a sieve, but she may yet use the very last drop of it to get her deal over the line.