Leadership crisis as UK nears March mayhem
May’s tactics on her Brexit deal increase the prospects of significant political miscalculation, market volatility, and a chaotic no-deal exit
Anew round of UK-EU talks begin on Monday after Theresa May suffered a significant defeat last Thursday in a UK House of Commons motion on her Brexit strategy. While the prime minister remains in power, her authority is now further undermined, in what is fast becoming a growing leadership crisis for the government.
The defeat on Thursday was an embarrassing rebuke to May who, on Tuesday, asked for “more time” until February 26 to find acceptable, legally-binding changes to the so-called Irish backstop, including potentially putting a time limit on how long it can stay in place. Yet, there are growing signs that her ultimate tactics on her Brexit deal, of which the Irish backstop is a key part, are to “run down the clock” potentially right up until the March 28/29 political wire, increasing prospects of significant political miscalculation, market volatility, and a chaotic no-deal exit.
The reason why many are now looking to March is the growing unlikelihood that Brussels will budge on the Irish backstop before February 26, especially after Thursday’s defeat. If any further compromise is made, this now appears most likely at the European Council’s summit on March 21-22 which could now become the withdrawal ‘end-game moment’.
By any standards, London and Brussels kicking the can down the road in this way to late March would be brinkmanship diplomacy of the highest order, and it remains possible that the UK Parliament could yet re-assert itself in the process, especially after Thursday’s vote. For now, however, a growing number of May’s critics are accusing her of deliberately seeking to “run down the clock”.
Critics charge here that, by the prime minister sticking to her multiple “red lines” over issues such as the UK leaving the European Customs Union, what she is really trying to do is get to the stage where Parliament ultimately faces a binary choice between her unpopular withdrawal agreement and no-deal. Remarkably, such a stark choice might encourage enough MPs to back her plan, despite widespread antipathy towards it, rather than risk the potential chaos of the alternative.
With political and economic angst rising over Brexit, there are several other key deadlines on the horizon this month, both economic and political. On February 20, for instance, there is a key international treaty ratification deadline for the UK. This stems from the fact that about 80 of around 100 post-Brexit international treaties with other countries remain to be ratified by Parliament, a process that — barring “exceptional cases” — requires 21 sitting days of legislators to complete.
Moreover, on the economic front, UK exporters are being increasingly inconvenienced by ongoing Brexit uncertainty. Take the example of exporters to Asia whose goods can take five to six weeks to get to markets like Japan.
From last Saturday, ships setting sail for Japan from the UK, and vice versa, could arrive after March 29 and find themselves in the middle of ‘nodeal’ tariff mayhem. This raises the prospects of goods being stuck in ports or facing hefty fines, and this potential problem is already a reality for ships that have set sail in recent days for even further flung destinations, like New Zealand and Australia, which is a journey of around 50 days from the UK.
Yet, despite this significant political and economic pressure to secure a deal in February, many are already turning to the March summit of EU presidents and prime ministers. This is very likely the ‘last chance saloon’ for concessions from the EU, or indeed an Article 50 extension request from the UK which would require the unanimous consent of all other 27 member-states. In such circumstances, where the outcome of EU-UK talks is still not clear by March’s summit, there are at least three main scenarios. The first is the prospect of no-deal which both sides are now ramping up preparations for the chaos that could ensue.
Significant number of amendments
A second possibility, should May get final concessions from the EU-27, will be expediting votes from March 23 through both the House of Commons and the Lords. While primary legislation of this sort can be rushed through quickly, in principle, the government cannot rule out a significant number of amendments being tabled that could still make the March 29 departure date unattainable.
The withdrawal deal would also need to be ratified by the European Parliament. Here, a Strasbourg meeting of Members of the European Parliament (MEPs) from March 25-28 would probably be the last chance for them to vote through the withdrawal agreement, leaving EU ambassadors only hours to potentially rubber-stamp the deal. However, given the possibility of last-minute problems, or even political miscalculation in these circumstances, it seems increasingly likely that the United Kingdom would ask for an Article 50 extension so close to the March 29 wire. Should the EU27 grant this, the UK Parliament must also vote to allow the legally binding exit date of March 29 to be changed.
Taken together, there is growing political likelihood that May and Brussels will kick-out the Brexit withdrawal endgame until March, unless the UK Parliament re-asserts itself. This could see maximum pressure placed on the week between March 21 and 28 which, so late in the day, would be brinkmanship diplomacy of the highest order that could yet yield a no-deal exit neither side wants.