U.K.: The Government Kicks the Brexit Can Further Down the Road

4 MINS READMay 17, 2019 | 16:52 GMT
The Big Picture

Stratfor's 2019 Second-Quarter Forecast noted that the British government would seek to avoid a disorderly Brexit during the quarter but that Parliament would also remain skeptical of the government's exit plans. As the crisis within the country's governing Conservative Party deepens, Theresa May's tenure as prime minister is coming to an end.

What Happened

A cross-party consensus on Brexit appears to be dead in the water. On May 17, British Prime Minister Theresa May admitted that negotiations between her government and Labour, the main opposition party, over a compromise Brexit plan had broken down without an agreement. According to May, the negotiations collapsed because of Labour's insistence on keeping the country in a customs arrangement with the European Union and holding a referendum on the new Brexit plan.

Why It Matters

May's government and Labour spent almost two months negotiating a compromise Brexit deal, but the prime minister and the main opposition leader, Jeremy Corbyn, are limited by rebel groups within their respective parties. While a large number of Conservative lawmakers object to plans to keep the United Kingdom in a customs agreement with the European Union (a key Labour demand), a large number of Labour legislators want to cap off the Brexit deal with a referendum (which many Conservatives oppose). A cross-party agreement would have stood a good chance of securing approval in the House of Commons, but that option is no longer on the table.

In the meantime, the British government has announced that it will hold a vote on the Withdrawal Agreement Bill (the package of legislation that legally enforces the Brexit deal that London negotiated with Brussels last year) sometime in the week starting June 3. The Commons has already voted against May's Brexit plan three times this year, but the prime minister hopes recent developments will help her win the vote this time around.

Even if the House of Commons again rejects May's withdrawal plan next month, it doesn't necessarily mean an immediate, no-deal Brexit.

First, she believes that a strong performance by the Brexit Party (which promises a hard Brexit) in next week's elections for the European Parliament will convince Conservative parliamentarians to finally make Brexit happen. Second, the prime minister promised May 16 that she would announce a concrete date for her resignation after the vote on the Withdrawal Agreement Bill, regardless of whether it is approved. By promising to resign, May wants to send the hard-liners in her party the message that they can take control of the negotiations over the future trade ties between the United Kingdom and the European Union after her own departure. On May 16, former Foreign Secretary Boris Johnson, a hard-liner, duly announced that he would stand for the Tory leadership when May finally exits the scene.

What Happens Next

If the Commons approves a Brexit deal in early June, the United Kingdom could conduct an orderly Brexit earlier than the Oct. 31 deadline. This, however, is still a big if, considering that the deal is unlikely to pass without support from some Labour lawmakers, whose party has already vowed not to endorse May's deal.

But even if the Commons again rejects May's withdrawal plan next month, it does not necessarily mean an immediate, no-deal Brexit. To begin with, May's resignation will usher in a weekslong leadership contest within the Conservative Party. Even if the new Tory leader (and, therefore, the prime minister) is a Brexit hard-liner, he or she is unlikely to unilaterally take the country out of the Continental bloc without at least trying to first negotiate a better deal with Brussels. In addition, the Commons will be on a summer recess between late July and early September, which will substantially reduce the political activity in the country. Meanwhile, other options on the table, such as holding an early general election, are even more time-consuming. Together, all these factors are likely to push the Brexit endgame until much closer to the actual Brexit deadline.

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