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ICG Brexit Update –
03 March

It’s the start of March and the Government deadline for triggering Article 50 is now just weeks away. Will we get there on time? The House of Lords seems intent on slowing the process down. Meanwhile, the European Commission has started to look at what life in the EU might look like after Brexit. Do their plans prove that the Leave campaign was right all along, and how will this impact on the negotiations?

Brexit: First blood

The House of Lords drew first blood this week as Theresa May faced her first parliamentary defeat over Brexit.  Peers passed an amendment to the Article 50 Bill on the thorny issue of the rights of EU nationals still living in the UK. Some form of amendment was not unexpected – the Government does not have a majority in the Lords and on this issue, at least, Labour and Liberal Democrat peers could join forces and push a change through.

Theresa May has vowed that she will not accept any changes to the Bill and will aim to remove the amendment when it returns to the House of Commons. There is a significant chance, however, that the Lords will pass further amendments on either the need for a ‘meaningful vote’ in Parliament at the end of negotiations, or on regular progress reports from Ministers. All these amendments were defeated in the Commons the first time around and May will be hopeful of doing so again.  But with next week’s Budget set to dominate the Commons’ time, the Government might have to make small compromises in order to meet the end of March deadline. If the Government can rely on another three-line whip from Jeremy Corbyn, however, the Prime Minister is much more likely to get her wish to have a ‘clean’ Bill.

It hasn’t been smooth sailing for May outside of Parliament either. Sir John Major, whose own Premiership was derailed by Tory in-fighting on Europe, gave a speech this week that pulled no punches on the risks of Brexit. His warning that many will lose out from a ‘Hard Brexit’ will be a morale boost for rebels on the Conservative benches before the Article 50 Bill heads back to the Commons.

Where next for Europe?

While the Brexit debate in the UK focuses on what our Government might achieve, the EU is starting to think about what its own future might look like. A European Commission White Paper, published on Wednesday, set out five scenarios for the EU’s future direction. These options vary considerably, from reducing the EU to just the Single Market, to creating a ‘multi-speed’ EU with different levels of integration for those countries that want it, to gradual movement towards a federal union.

What is clear from the White Paper is that change is unavoidable. Even the ‘carry on as before’ option notes that the continued pressure on the Schengen visa-free travel area might lead to dramatic changes to how the Single Market operates. The European Commission is said to favour much greater integration. This includes giving the EU its own tax powers and a much greater role in foreign policy. Given rising Euroscepticism in many parts of Europe, it is unclear whether this will be politically achievable. Should the EU choose to go down this road it will be music to the ears of the UK’s Leave campaigners, who warned that the UK would be forced down the same path if we had decided to remain in the Union.

What does this mean for the negotiations? According to Brexit Secretary David Davis, the UK should now be prepared for the “unlikely” scenario of leaving the EU without any form of trade deal at all.

The other Union

Meanwhile, debate rumbles on about whether Brexit will also lead to Scottish independence. Each Government department has been instructed to do all it can to demonstrate the value of the UK to Scotland and Ben Gummer, the Cabinet Office Minister, has reportedly been put in charge of coordinating pro-UK efforts.

Nicola Sturgeon is less keen. The First Minister used a speech in Edinburgh this week to call for a second independence referendum if Scotland cannot secure a deal on its future relationship with the EU before Article 50 is triggered. Similar warnings have been issued by both Tony Blair and Sir John Major, who each cautioned that a bid for independence has been made more likely by Brexit. Theresa May was less than impressed. She warned that the SNP had “tunnel vision” about independence and told Sturgeon she should be focused on governing and not campaigning.

Week in quotes

“I have watched with growing concern as the British people have been led to expect a future that seems to be unreal and over-optimistic. Obstacles are brushed aside as of no consequence, whilst opportunities are inflated beyond any reasonable expectation of delivery.” – Sir John Major gives his view on the Government’s Brexit strategy

“Proposing a further decision on independence wouldn’t simply be legitimate, it would almost be a necessary way of giving the people of Scotland a say in our own future direction”– Nicola Sturgeon call for a second Independence Referendum…

“Politics is not a game and should never be treated as such. It is a serious business, centred on improving people’s lives” – …. And Theresa May responds.

“The UK’s most important peacetime operation” – David Davis on the scale of Brexit talks.

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News

Four PA Brexit Update 31 March

Welcome to the new Brexit Update from Four Public Affairs, the new home of Insight Consulting Group (ICG). This weekly email keeps you up to date and informed about developments at home and abroad as we move towards our exit from the European Union. Earlier this week, we published our ‘Guide to Brexit’ mind map to help you understand the challenge ahead for the Government. You can find a copy here: http://www.fourcommunications.com/blog/guide-brexit-issues-opportunities-and-challenges

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