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Grayling's Brexit Bulletin - 15 February 2019

15th February 2019


 

The BREXIT Bulletin: The Morning after the Night Before II

 

Last night the UK Government lost another Brexit vote, in which the House of Commons was asked to reassert that it was against "no deal" and that it would support the Prime Minister’s Withdrawal Agreement if “alternative arrangements” could be found for the Irish backstop. On the face of it, Parliament voted against a motion which reiterated what Parliament had agreed only two weeks ago.
 
Why did the Government lose the vote?

Because when the Commons voted against no deal and for alternative arrangements on 29 January, the two votes were separate. Yesterday evening, the two were wrapped up in a single vote. This clearly demonstrates that many MPs are against no deal but wouldn’t back the Withdrawal Agreement even with changes to the Irish backstop.

Conversely, a number of MPs are in favour of no deal and would support the Withdrawal Agreement if changes were made to the Irish backstop. In the end, the European Research Group of Conservative Brexiteers chose not to vote in favour of last night’s motion, as although they say they would support the Withdrawal Agreement with changes to the Irish backstop, they don’t agree with taking no deal off the negotiating table.
 
Last night primarily served as a reminder of how difficult minority Government makes winning votes in Parliament. The EU are well aware of this difficulty, and the consensus view is that last night weakened Theresa May’s negotiating hand. She and her team have spent the last few weeks saying that the vote on the 29 January showed that if only the EU made concessions on the Irish backstop, she could get the Withdrawal Agreement through Parliament. The EU have continued to refuse to make further concessions – believing that May cannot guarantee she would win a future vote on the Withdrawal Agreement. Last night provides the EU with further evidence in support of their case.
 
The vote has also given further momentum to those calling for a “softer” Brexit than that which is presently being negotiated. In particular, many MPs are claiming it shows that the only kind of deal which Parliament would approve is one which sees the UK remain a member of the customs union. At present, there is no indication of May changing her negotiating position, as a softer Brexit is expected to split her party – leaving her unable to govern on Brexit day +1, even if she managed to get a deal though Parliament.
 
May is due to update Parliament on the negotiations in the week commencing 25 February, and another set of votes are then expected to be held. This is being built up as ’high noon’ and the last moment at which Parliament could take control of the Brexit process. Many expect the large majority of parliamentarians opposed to no deal to act at this moment. However, with the UK legally committed to leaving the EU on 29 March, time is short. This suggests that even if Parliament were to take control, an extension to Article 50 would be necessary.
 
The uncertainty would be that the scale of the splits in both the Conservative and Labour parties don’t indicate a majority for any route forward. At their most vociferous, these splits have been characterised by the accusation levelled by Conservative Business Minister Richard Harrington who encouraged the ERG members to join Nigel Farage’s new Brexit Party, saying “they’re not Conservatives”. Similarly, rumours are once again swirling of a split in the Labour Party, with between 4 and 10 committed remain backbenchers considering resigning the Labour whip to sit as independents.
 
Last night was legally meaningless but politically important. It further reiterates that Parliament is divided, but also that it is unwilling – so far – to take control of the Brexit process. It will make Theresa May’s negotiations in Brussels harder and mean that no resolution to the current uncertainty is likely for the next fortnight.

Whatever happens at the end of February, and even if a Brexit deal is passed, this period of significant political uncertainty and volatility is likely to continue for many months.

 



If you have any suggestions about the Brexit Bulletin or want to find out more about a specific aspect of Brexit, please do let us know. Please visit the Grayling Brussels website, follow us on Twitter @TheEULobby, and don't forget to check out our Brexit Papers


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This week's content:

The view from Brussels

The view from Germany

The view from the United States

 

The view from Brussels

The EU walking the walk on ‘No-deal’?
POLITICO this week leaked an internal European Commission Secretariat General document detailing the institutional state of play on the raft of Brexit preparedness and contingency proposals, used to brief the European Parliament’s Brexit Steering Group.
 
As a reminder, the proposals range from common rules for ship inspections, to the EU’s energy efficiency targets, to ensuring basic rail, road and air connectivity, through social security and Erasmus + to fishing authorisations and visa exemptions.
 
The gist of the leaked document is that the Secretariat General and its Brexit Preparedness Group are satisfied with the progress the being made in the European Parliament and the Council towards the expedient adoption of the legislation before 29 March. MEP’s will vote on the files at the March Plenary.
 
On only one file does the Secretariat General believe that progress is not on track, specifically on measures relating to the financing of the EU budget, a file that will leak into the April Plenary.
 
The Grayling View
When meeting with the Brexit Preparedness Group back in Autumn 2018 your columnist was struck by the sheer scale of the task given to its members and by a sense that the Commission, unusually for Brexit, might not have a grip on ‘no-deal’ preparations.
 
The Secretariat General’s report that preparations are on track is testament to the Commission’s ability, when pressed, to deliver complex projects spanning the entire policy purview granted to it under EU law.
 
Following another defeat for the UK Government’s Brexit strategy in the UK Parliament and no clear route to avoiding a ‘no-deal’, the EU appear reasonably confident that they are mitigating well against its impacts.
 
Some industry sectors would suggest that the measures do not go far enough. We will have to wait to see whether the lawmakers are correct, although of course, ideally we would never know.

 



The view from jsk.berlin: our affiliate in Germany

A glimmer of hope at the 11th hour?
Germans are breathing a sigh of relief – some more publicly than others – as one major player in the Brexit stalemate begins wiggling a pinky finger. The German Brexit concerns are myriad, from plummeting food prices and lost vacations to chlorine chickens (oh yeah, and also the future of the Single Marker), and with the exception of the far-right Alternative for Germany (AfD), the other four parties represented in the Bundestag have clearly singled their preference for a ‘soft’ Brexit.
And so the Leader of the UK Labour Party Jeremy Corbyn’s offer of a ‘softer’ Brexit is a sight for many sore, German eyes. The leader of the German Socials Democrats (SPD), Andrea Nahles, wrote a letter of support to Corbyn. For good measure, she also posted a message to the same effect on her Facebook page. Chancellor Angela Merkel (CDU) herself gave a diplomatically positive, though indirect, response: “I am convinced that we can find solutions without reopening the Withdrawal Agreement”.

The jsk.berlin view
Martin Schulz (SPD), the former president of the European Parliament, also welcomes Corbyn’s efforts. But let’s not forget that the UK Labour Party and German Social Democrats have a very long and amicable history. In other parts of German politics, Corbyn is seen far more critically, and indeed, his proposal has come very late in an extremely tedious and contentious negotiation. It also still seems to be anything but realistic. And so we approach the final countdown and the ball it still squarely in the UK’s court.

 


 

The view from the United States

The US watches from the sidelines
Although the foreign-policy establishment in Washington is watching Brexit closely, rank-and-file lawmakers are generally much less focused on it than their European counterparts, particularly given ongoing internal crises like the partial government shutdown. One notable exception to this is in the area of trade, where the Trump Administration has notified Congress of its intent to begin negotiations with the UK once Brexit is concluded. There is longstanding bipartisan interest on Capitol Hill -- in particular among the committees overseeing foreign trade (House Ways and Means Committee, Senate Finance Committee) -- in helping to shape a future U.S.-U.K. trade agreement.  

That said, Trump and his inner circle are notably pro-Brexit and are cheering the process on, both publicly and behind the scenes. In Davos last week, U.S. Secretary of State Mike Pompeo mentioned Brexit as an example of a series of global disruptions that are overall a “positive development.” Washington media company Axios reported that National Security Advisor John Bolton regularly talks to UK International Trade Minister Liam Fox and Transport Minister Chris Grayling, conveying support for Brexit and encouraging them to “keep it up.”

A handful of U.S. lawmakers with large numbers of Irish-Americans in their constituencies are watching the Brexit process as it pertains to the Irish border.  Rep. Richard Neal (D-Massachusetts) for example, stated, upon the failure of Theresa May’s plan in Parliament: “I urge all sides to redouble their efforts to find a path forward that can, at the same time, respect the achievements of the European experiment, the will of the people of the United Kingdom, and the legacy of the Good Friday Agreement. I look forward to continuing to engage with my counterparts in both the UK and the EU as they navigate the challenges before them.”  


Andrew Adair is a former Capitol Hill staffer and lobbyist in DC and founder of DC/Berlin, a consultancy helping German business navigate opportunities in Washington. He has partnered with our German affiliate jsk.berlin as a transatlantic consultant.
 


 

Dates for your diary

29 March 2019 - UK expected to leave EU
31 December 2020 - Expected end of transition

 


 

Grayling Brexit Unit

Our Grayling Brexit Unit brings together the very best consultants from across the Grayling network and includes those who have direct experience of working alongside the leading political figures charged with negotiating Brexit in London and Brussels.

The Grayling Brexit Unit is here to support, guide and inform the success of your business and identify how the political dynamics will change as a result of Brexit in both London and Brussels. We are your Brexit experts.

Please contact Robert Francis Tel +32 2739 47 34 (robert.francis@grayling.com) in our Brussels team or Jonathan Curtis (Jonathan.Curtis@grayling.com) in London for more information, and check out our brochure.

 


 

 

 #Brexit Papers 


Brexit Negotiating Documents
The 'Great Repeal Bill'
Brits working in the EU institutions
Article 50

Sir Julian King - The Last UK Commissioner
David Davis – UK Brexit Secretary.
Sir Keir Starmer – Shadow Brexit Secretary.
Sir Tim Barrow – UK Permanent Representative.
Michel Barnier – EU Chief Negotiator.
Sabine Weyand – Barnier’s Deputy.
Guy Verhofstadt – EP Brexit Lead
No-deal – Concrete impact


Grayling Team

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