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ICG Brexit Update –
17 March

Picture the scene. It’s Monday morning in Downing Street. Despite all the debate, the Whips Office is convinced that the Article 50 Bill will pass without amendment and the House of Lords will back down. This is the Prime Minister’s moment of triumph. She has swept away all opposition from both within and without. Theresa May has the full authority to negotiate a Brexit deal of her own making. But then, out of the corner of her eye, she spots it. BBC News: Nicola Sturgeon to hold a surprise press conference at 11.30. What could possibly go wrong…?


The First Minister, of course, used the likely passage of the Article 50 Bill to make her long expected bid for a second independence referendum. In one sense this was unsurprising – Sturgeon has been laying the groundwork for a new poll from the moment the EU referendum result was clear. It was the timing that was the shock. The SNP had everything ready to go, including a website, an audacious fundraising plea and even a Twitter-ready, referendum-themed, set of gifs. Yet despite all this preparation, nothing had leaked in advance. Some had expected Sturgeon to use her upcoming speech at the SNP’s conference to announce a referendum but such a deliberate intervention into the Article 50 debate took commentators by surprise. If it wrong-footed the media, it also certainly wrong-footed Theresa May.

The Scottish Government’s arguments for a second independence referendum were simple. Scotland overwhelmingly supported Remain, and yet faces a “material change of circumstances brought about by the Brexit vote”. It argues that a vote should be held once the terms of a Brexit deal are known, but before the UK’s exit from the EU is finalised. Furthermore, the SNP claims Theresa May’s own personality has made this inevitable. Sturgeon told the press that attempts to negotiate with Westminster over Brexit were “met with a brick wall of intransigence” from May and her team.

All of this puts May in an unenviable position. Opinion polls around ‘IndyRef2’ suggest a photo finish. The collapse of Labour in Scotland, worsened under Jeremy Corbyn, means much of the fighting force behind 2014’s Better Together campaign has dissipated. Fighting on two fronts – independence and Brexit negotiations – is almost the last thing Theresa May wants. Even worse would be becoming the Prime Minister who presided over the disintegration of the Union. Can Westminster deny Holyrood a vote?

The answer is yes – sort of. Theresa May finally responded to Sturgeon on Thursday and declared that “at this point, all our energies should be focused on our negotiations with the European Union about our future relationship”. The caveat there is clear. A referendum seems inevitable, but May won’t countenance one before Brexit has been finalised. Whether May or Sturgeon will get their way, and if they can come to a deal without precipitating a constitutional crisis along the way, remains to be seen.

The Final Countdown

The first material impact of the SNP’s demands has been on the triggering of Article 50. Initially expected to be as early as Tuesday, the Government delayed Royal Assent of the Bill until Thursday. Formal notification to European leaders might now have to wait until the 27th. Downing Street reportedly felt it had to leave enough time after Sturgeon’s announcement to stop the two stories becoming intertwined. May’s advisers are still locked in intense debates about how long her ‘Article 50 letter’ should be and what she should say in it.

The delay has done Theresa May few favours with Europe. A summit for the ‘EU27’ leaders had been set for the start of April, in expectation that negotiations would begin this week. That has had to be rearranged. Meanwhile, the hole in the news cycle where Article 50 should have been has been filled with further debate around whether “no deal is better than a bad deal”. Donald Tusk, President of the European Council, was unimpressed. He tweeted that the EU “will not be intimidated by threats that no Brexit deal is good for UK & bad for EU”.

Deal or No Deal?

For all the Brexit Secretary’s bravado around the prospect of ‘no deal’, David Davis had few answers for the Chair of the Brexit Select Committee, Labour’s Hilary Benn. Under sustained and incisive questioning from Benn, it became clear that Davis and his Department had conducted no assessment of the impact of not getting a deal and leaving the EU on WTO terms. Davis did acknowledge that not having a deal would likely be “not as good an outcome as a free-trade, friction-free open agreement”.

Meanwhile, former WTO director Pascal Lammy shared his thoughts on the negotiations with the Institute for Government this week. He struck a slightly mixed tone, suggesting that the outcome would be “complex, permanently costly but not the apocalypse”. He also stressed that, despite claims to the contract from some quarters, the EU would not want to punish the UK for leaving. This doesn’t mean that the negotiations are without risk for Theresa May though. As Lammy put it, “this is a wetland and sometimes you get drowned”.

Week in Quotes

“The simple fact remains that you have changed your mind since the excellent speech you made in the Referendum campaign arguing that we should remain in the European Union. I have not”. Sacked Government adviser Lord Heseltine issues a stinging rebuke in a letter to Theresa May.

“That’s my job as prime minister. Right now we should be working together, not pulling apart. And so, for that reason, I say to the SNP, now is not the time.”– Theresa May rejects the SNP’s demand for a second independence referendum.

It’s an argument for independence, really, in a nutshell, that Westminster thinks it has got the right to block the democratically elected mandate of the Scottish government and the majority in the Scottish parliament. History may look back on today and see it as the day the fate of the union was sealed.” – An unimpressed First Minister responds.


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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:

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