Late last night Theresa May and Jean Claude Juncker announced that a deal of sorts had been reached over the Withdrawal Agreement. Today the deal has been rejected by the ERG and DUP and looks set to be defeated in the second meaningful vote this evening.

The agreement announced last night consisted of three new documents:

  1. A joint interpretive instrument which has legal force clarifying that the backstop is not intended to be permanent. It points to the fact there is a so called ‘good faith’ clause in the Withdrawal Agreement to negotiate a free trade deal to avoid the backstop coming into force. It also points out that the UK can point to this clause if it wants to raise a complaint to an arbitration mechanism that this isn’t being followed.
  2. A joint statement that is essentially an addendum to the political declaration on the future relationship making further commitments (not legally binding) to explore ‘alternative arrangements’ based on new technology to negate the need for the backstop.
  3. A unilateral statement from the UK government (not agreed by the EU) that states the UK’s interpretation of all these documents taken together is that it would be able to ‘take measures’ that could ultimately disapply the backstop if the EU does not negotiate a free trade agreement or alternative arrangements in good faith.

Theresa May wasted no time in claiming these documents amount to ‘legally binding changes’ to the Withdrawal Agreement. In the joint press conference Jean Claude Juncker stuck to the form of words that this is ‘consistent with the Withdrawal Agreement’.

Theresa May’s hopes of persuading MPs to back the ‘new’ deal were dealt a significant blow this morning by Attorney General Geoffrey Cox’s legal opinion. Cox stated that ‘the legal risk remains unchanged’ that the UK would have no legal means to exit the backstop if no alternative arrangements can be agreed despite the best endeavours of both sides.

The two key groups that May was looking to win over in the Commons, the DUP and ERG, have both reportedly indicated this is not enough and are not expected to back the deal. The Labour leadership have also said they will vote against as they don’t believe anything substantive has changed, with little prospect of large numbers of Labour backbenchers defying the whip to back the Prime Minister. The deal therefore looks set to be defeated again in tonight’s vote.

Should this be the case, attention will then swiftly turn to the promised votes on whether to rule out no deal (due tomorrow) and whether to request an Article 50 extension (planned for Thursday). Parliament is very likely to take no-deal off the table. However, an instruction to request an extension, while likely, may be muddled and unclear. The key questions are: for how long and to what end? While Parliament can indicate its preference on these questions, they will ultimately be dictated by what the European Union will accept and may come with very unpalatable conditions.

A second defeat for May’s deal tonight will be a major blow. It potentially opens the door to Parliament taking control of the process with the likely outcome being a delayed and softer Brexit. It also, yet again, ratchets up the chances of a no deal outcome (either in March or at the end of a short extension). Finally, it will inevitably raise further questions about the longevity of Theresa May’s premiership and, should it be entering its final phase, what comes next.

There may be further twists and turns to come before today is over but, as things stand, the situation for Theresa May and the government looks bleak.