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What happened in the land of Brexit last night and what happens next?

Words by:
Managing Director
January 30, 2019

Last night, Conservative MPs united for the first time in months around a course of action, backed by the Prime Minister on the next steps in the Brexit process. That is the most optimistic take on yesterday’s events for the Prime Minster.

A more realistic, but still generous, assessment of events is that Theresa May beat a tactical retreat to avoid yet another large defeat in Parliament that would have seen MPs seize control of the Brexit process directly. A yet more pessimistic take is that she capitulated to the ERG hard-Brexiteers and the DUP, making an almost undeliverable promise to renegotiate the Withdrawal Agreement to change or remove the hated backstop.

The facts are that the Prime Minister opened yesterday’s debate by announcing that she would seek to reopen negotiations on the Withdrawal Agreement to secure legally binding changes to the backstop. She then asked MPs to back an amendment tabled by 1922 Committee Chair Graham Brady that backed the Withdrawal Agreement as long as the backstop was replaced with unspecified ‘alternative arrangements’.

May also had some warm words for the so-called ‘Malthouse compromise’ proposals that had been hastily briefed to the media. This essentially calls for the use of technology to avoid the need for a hard border (and therefore the backstop) or for a managed no deal that takes place with a longer lead in (December 2021). This is a long way from being acceptable in Brussels but has demonstrated that the rival factions within the Conservative Party are finally coming together.

This proved to be enough to swing the Conservative Party behind her. Amendments tabled by Dominic Grieve and Yvette Cooper that would have seen MPs seize control of the Parliamentary timetable and processes in order to find an alternative approach (likely a softer Brexit) were defeated. The Brady amendment was passed. The only government defeat occurred on an amendment that expressed Parliament’s desire to avoid a no deal Brexit but is not legally binding.

Attention now turns back to Brussels. The European Commission and several remaining EU Member States (including Ireland) immediately rejected May’s call to reopen negotiations on the Withdrawal Agreement. There have been briefings to the media about the possibility of using a ‘Joint Interpretive Instrument’, essentially an addendum to the Withdrawal Agreement, that could have legal force as one possible route forward. However, it is far from clear that this meets the threshold demanded by the Brady amendment last night.

Theresa May has spent the last two years trying and failing to find a way through the hard-line positions of the DUP and ERG on one side, and the EU’s red lines on the other. She now has two more weeks to try to solve this riddle before facing MPs again on 14th February. Should she fail, we will be back to square one, with a likely repeat of last night’s series of votes on various different options.

So where does this leave us?

Firstly, the chances of a second referendum are receding. There appears to be little appetite from most MPs for this approach and without a majority in the Commons it is a non-starter.

Secondly, the chances of an immediate election are also lengthening. The Conservative Party’s (likely temporary) truce strengthens the Prime Minister’s position in power in the short-term with time now almost out to hold an election before March 29th (assuming no extension of Article 50). However, questions remain over her tenure in the medium-term and the prospect of a Corbyn-led Labour Government in the foreseeable future has not gone away.

The chances of a deal getting through Parliament will depend on two things: whether the initial no from the EU really does mean no; and whether the newly forged mood for compromise within the Conservative Party extends to considering compromises from the EU that fall short of the ERG’s redlines. The ticking clock of no deal may help nudge MPs in this direction but there is deep scepticism among other EU leaders that May can actually deliver a deal even if they offer more concessions. Changing this perception will be a key task now for the Prime Minister.

If this latest attempt at renegotiation fails, the prospect of Parliament seizing control of the process will likely be revisited. If and when MPs do get another opportunity to shape the process more directly, it seems likely that a significantly softer Brexit will be the likely outcome. But the question remains, to what end? MPs last night backed away from shouldering this responsibility. Once again, the impending prospect of no deal might make them bolder if they get another chance.

Finally, no deal remains the legal default and is looming ever larger with the clock ticking. An optimist could say last night was a step in the right direction with Conservative MPs finally uniting behind something, even if it isn’t the ultimate solution. A pessimist might say we shuffled closer to the cliff edge of no deal. Nothing has yet been resolved.

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