Kick-starting Brexit: what’s happening in the UK?

Yesterday marked the kick-off for Brexit. UK Prime Minister Theresa May’s speech setting out her Brexit plans was delivered under the banner of ‘A Global Britain’. She started by giving an impassioned, and perhaps gilded, defence of the reasons why people voted to Leave in the referendum last year. The view espoused by the Prime Minister – that Leavers didn’t vote to turn in on themselves but to look outwards to the world – is what we might term ‘the liberal Leave view’, and one which split the Leave campaign into two warring factions during the referendum campaign itself.  The Prime Minister’s words might be termed ‘owning the moment’ in which she is able, in the absence of a strong opposition, to create the narrative she desires.

So. May’s interpretation is one of the reasons for Brexit, but she knows that seeking a fairer Britain has to be one of her key demands of the negotiation process.  Remembering her first speech on the steps of Downing Street, May talked about reining in immigration, reducing pressure on schools, helping working people’s wages to rise. This was undoubtedly a large part of the reason the UK is leaving the EU.

In a surprise announcement, May said that the final deal would be put to a vote in both Houses of Parliament. During questions she outlined her expectation that neither would vote against the will of the people, putting Labour in an immediate tight spot. Refusing to vote for the deal could be the death warrant of northern Labour MPs, where UKIP are steeling for a fight in areas where people voted overwhelmingly for Leave. May threw them a bone as she highlighted the importance of legal protection for workers and workers on boards, to placate concerns that Brexit was all about stripping away workers’ rights. Trade Unions will also breathe a sigh of relief, given how many of their members backed Leave. This could give many cover to change their tune on Brexit.  Those imperilled backbenchers are not however helped by Jeremy Corbyn’s characteristic silence on today’s announcement.  Allegedly in Copeland ahead of the impending by-election, and aside from a pooled clip, the reaction in the TV studios has been left to Lib Dem leader Tim Farron – he of 9 MPs, 3 of whom don’t back his position on Brexit.  Poll after poll shows people don’t know what the main opposition’s view on this whole situation is, and the people can’t be blamed. Corbyn started as he means to go on with the EU – abject apathy – and his hope is that nobody will notice and Labour can carry on campaigning.

The Prime Minister spent a large proportion of the fairly long and detailed speech spelling out the importance of the Union.  She clearly means business here and plans to bring the devolved authorities as long as much as is possible, but her steely determination means she will likely take no nonsense, notably from Scottish First Minister Nicola Sturgeon, who has flopped about on a second independence referendum for the past 6 months.  She was at pains to stress the determination of the Government to prevent the creation of a hard border with the Republic of Ireland.  There’s good will between the UK and Ireland, and the Prime Minister’s characterisation of the negotiation stance the UK will take with the 27 – in the spirit of getting the best out of the deal for everyone – will need all the allies it can get, so annoying the Irish is not on her plate.

The Prime Minister’s spin doctors have been calling this one a ‘clean Brexit which might be categorised as a ‘Hard Brexit Minus.’  We will leave the single market, but will seek access for industries with complex interdependent relationships like the automotive or financial sectors.  We will not be part of the Common Commercial Policy – a new one for most people – but nor will we definitively leave the Customs Union, unless of course we cannot make our own trade deals.  It all depends, apparently, on what the EU is willing to negotiate.

The crux of the matter came at the end.  Theresa May wants the agreement settled within the 2 year period – but she recognised that business and others might not be prepared for an immediate implementation, so she fixed on the idea of a phased withdrawal, according to requirements in each policy area.  On the first of these she may be hoisted by her own petard – many of the now infamous experts believe this might be difficult to achieve, and much slippage could see this become an election 2020 issue – the Prime Minister must surely wish to avoid this.  The second seems sensible, but gives rise to the possibility that opponents of Brexit – the Lib Dems and SNP – could go into 2020 fighting on a policy of preventing implementation of the phased withdrawal.  May must surely want to avoid making that a cleavage in British politics for the long term, so expect her to work hard to ensure those transition periods are not particularly long.

Judgement on the PM’s ability will not come quickly, except on the currency markets.  The pound has gained substantial ground since yesterday, making its biggest one day gains in over a decade.  Much of the risk had already been priced in ahead of the speech, her team having cleverly briefed out the negative news in advance, so a further fall could’ve been disastrous.  But despite the rise, one thing is sure, it isn’t healthy for a currency to rise and fall on the every word of a Prime Minister.  Expect more uncertainty in the years ahead.

May’s final words were given over to a veiled threat to the EU. The UK retains a number of tricks up its sleeve: the willingness to reduce taxes and change our economic model; a trade surplus; intelligence services and the strongest armed forces in Europe; and the City of London’s importance to the EU.  Her message was clear: let’s play nicely, or everyone gets hurt.

May’s 12 Point Plan for Britain

  1. Provide certainty around the negotiation process wherever possible
  2. Ensure all laws are made in Westminster, Edinburgh, Cardiff and Belfast
  3. Maintain strength in the Union
  4. Maintain the Common Travel Area with the Republic of Ireland
  5. Control immigration from the EU
  6. Guarantee the rights of EU citizens in the UK and British citizens in the EU
  7. Protect workers’ rights
  8. Create a bold and ambitious free trade agreement with the EU
  9. Rediscover Britain’s role as a global trading nation
  10. Put science and technology at the heart of UK economy through collaboration with the EU
  11. Work closely with the EU and allies over foreign affairs and defence
  12. Phase the process of implementing the UK’s withdrawal

posted by Magnify Team on 18/01/2017 @

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