It’s fairly clear that the tectonic plates of the British constitution are shifting. After a grating and grinding battle between the legislature and the constitution, the main friction point moved to the judicial sphere.
And the UK Supreme Court has ruled that the process by which prime minister prorogued parliament for five weeks in the run-up the October 31 date when Brexit is now due was not lawful. What happens now in terms of process is unclear but what appears to have been almost completely overlooked in the generally turgid and jargon-rich commentaries that have surrounded the case is that the result is unlikely to matter.
In fact, despite losing this specific trial of strength, Johnson may still come out the winner.
The goal of the teams taking on the government in court was to stop executive overreach. They argued that the government had devised a lengthy prorogation to limit the time available for parliament to hold the government to account over Brexit ahead of the October 31 deadline. The government insisted that the break was needed to organise a new parliamentary session. The courts have decided this was not the case.
But judicial bravery in highly contested constitutional waters may have the unintended consequence of delivering a major “Boris boost” in terms of public support. Whether through serendipity or strategy (probably the former) the prime minister has created a win-win situation that nobody seems to have noticed.
The Supreme Court upheld campaigner Gina Miller’s appeal and overturned a ruling by the English High Court that suspending parliament was “not a matter” for the judiciary.
In so doing, the court is, in effect, siding with the highest court in Scotland, which ruled earlier this month that the prorogation of parliament was unlawful as “it had the purpose of stymieing parliament”.
This decision is certain to spark the political equivalent of a volcanic eruption with claims and counter-claims of judicial activism and political incompetence. Academics will undoubtedly scuttle off to the library in an attempt to somehow reconcile the Supreme Court’s decision with legal scholar J. A. G. Griffith’s classic account of “the political constitution” in the United Kingdom (Modern Law Review, 1979 and still well worth reading).
In reality, such matters are relatively simple. The court’s decision is constitutionally legitimate on the basis that it was upholding the basic tenet of parliamentary sovereignty. Far from undermining the political constitution, the Supreme Court would from this position be protecting it, while retaining a politically subservient position.
But what no one seems to have considered is that Johnson is an explicitly populist politician. He will live to whiff-whaff another day. His whole approach to gaining the keys to No.10 has revolved around constantly responding to – and to some extent amplifying – the populist signal, not least over Brexit. In this context, a Supreme Court defeat risks simply playing into Johnson’s gameplan. It will not stop Brexit. But for Johnson and, especially for his shady apparatchiks, it will be yet another example of “them” (that is, the elite, the experts, the untouchables that wield power without responsibility) against “us” (the Great British public).
The rules of political engagement have already been altered almost beyond recognition, and Johnson’s entire brand is based on being an unconventional politician.
The great risk of the Supreme Court ruling is that it will add fuel to a populist fire that is already raging about the need for a strong leader. Indeed, one of the few similarities between all the different manifestations of populism that have emerged around the world over the past decade is the existence of a charismatic and strong leader who can mobilise the masses and manipulate how dominant issues are framed. In the UK it is Johnson who seems to be staking the greatest claim to this role – and his popularity amongst Conservative Party members provides a powerful platform.
Britain’s threadbare constitutional framework makes it particularly vulnerable to the wrath of a strong leader. Where other countries have adopted a codified constitution, clear rules of engagement and an explicit role for the courts in curbing executive power, the British constitution operates through what the eminent constitutional historian Peter Hennessy has called “the good chaps theory of government”, which presumes that all politicians will exercise a high degree of self-restraint, respecting the unwritten rules of the constitution.
What’s worrying is that the words “Boris Johnson” and “self restraint” have rarely – if ever – been used in the same sentence. He is not a man to play by the rules and the power of populism appears far too tempting. This is reflected in his refusal to rule out simply suspending parliament again. This tendency to pander to populism is exactly why a judicial loss risks boosting rather than wounding the prime minister.
Britain's economy risks damage if Brexit is delayed beyond its latest Oct. 31 deadline because companies would continue to hold back on investment, Bank of England deputy governor Ben Broadbent was quoted as saying on Monday.
"It's pretty clear that investment has been feeling the consequences of the uncertainty about Brexit and particularly the possibility of a bad outcome," Broadbent told the Press Association news agency.
"If you continually expect news to arrive imminently - a resolution - then that can have quite a depressing effect on investment," he said.
By contrast, a Brexit deal would lead to "quite a strong bounce-back in investment."
Broadbent reiterated the BoE's guidance that future interest rate increases would be limited and gradual, adding the "emphasis is on the 'gradual' bit of limited and gradual."
He said he did know whether the British central bank would need to increase rates or cut them in the event of a no-deal Brexit shock to the economy.
"I don't know. I really don't, because I don't know how much the exchange rate will move," he said.
Several other top BoE officials, including Governor Mark Carney, have said a rate cut would probably be needed to help the economy weather the shock of leaving the European Union with no deal.
On whether he will put his name forward as a candidate to succeed Mark Carney as BoE governor, Broadbent said: It's a big job...I have lots of things to think about before I make that decision."
The British pound rose on Monday as investors prepared for parliament to vote on a series of Brexit options, with some hoping that the current uncertainty will end in a softer Brexit than Prime Minister Theresa May’s defeated withdrawal agreement.
May’s deal was voted down for a third time by lawmakers on Friday, sending sterling plunging to below 1.30 dollar.
But the British currency has held at or above that level since, suggesting some investors have priced out the prospect of Britain crashing out of the European Union without a deal and instead expect a long delay to the exit or Brexit to emerge eventually where closer ties are maintained to the trading bloc.
“There is a growing expectation that a (House of) Common’s majority could coalesce around a softer Brexit that includes a custom’s union but she is facing more threats from cabinet members to resign if she decides to pursue a softer Brexit,” MUFG analysts said.
Sterling rose 0.4 per cent to 1.3083 dollar, also finding support from better-than-expected manufacturing survey data.
The pound gained 0.1 per cent to 85.980 pence per euro.
The analysts at MUFG said that while a no-deal Brexit on April 12 remained a risk for the pound, an emergency EU summit on April 10 could – if British lawmakers cannot agree anything this week – see a long delay to Brexit.
Parliament will vote on different Brexit options on Monday and then May could try to bring her deal back to a vote in parliament as soon as Tuesday.
But May’s government and her party remain in open conflict.
Marshall Gittler, a strategist at ACLS Global, said he considered a no-deal Brexit “as a higher possibility, even though it’s officially been ruled out, simply because I don’t see any of the other endings as particularly possible.”
The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index in at a reading of 55.1 for March, above the 51 level forecast by economists polled by Reuters.
The survey showed that factories in Britain stockpiled for Brexit at a frenzied rate last month, pushing manufacturing growth to a 13-month high.
The European Union and India have been negotiating a free trade agreement (FTA) since 2007. Despite growing trade between the EU and India, talks stalled in 2013 after 16 rounds, only resuming in 2018. There has been talk in Brussels that Brexit might help remove some of the hurdles to an agreement. But this is unlikely to be the case.
If anything, the UK is better positioned to secure a trade deal with India than the EU, although this will not be straightforward. The UK’s desire to curb immigration is likely to lead to tough negotiations. But future UK-India FTA talks may well be an opportunity to negotiate a manageable set of strategic priorities.
The EU is India’s largest trading partner, accounting for around 13% of India’s total trade in goods in 2017. India contributes around 2.3% of total EU trade and is the EU’s ninth biggest trade partner. Trade in goods between the EU and India grew by three times over 2002-18, from €28 billion to €91 billion.
Services are also an important component of EU-India trade. Eurostat data shows that Indian services exports to the EU were €16.6 billion in 2018, while imports were €17.1 billion. The sector has also attracted foreign direct investment from the EU, including Germany, the Netherlands, France, Italy and Belgium, as well as the UK.
Talks between the EU and India broke down in 2013, after it became clear that reaching an agreement on the demands for tariff reductions and market access, as well as the inclusion of social, environmental and human rights clauses would be impossible. Discussions resumed in 2018, which led to the declaration of an EU-India strategic partnership. While this agreement helped to resume the talks, it mainly reaffirmed current ties rather than tackling any of the issues that caused the trade agreement discussions to stall initially.
From the EU’s perspective, the main sticking points were drug patents, tariffs for second-hand cars, agriculture, services, rules of origin and an unacceptable list of sensitive items. The EU is adamant about negotiating a stronger intellectual property regime and a sustainable development chapter with social and environmental clauses, which India is unwilling to include in the trade agreement.
Plus, the EU wants detailed provisions for investor-state dispute settlement (ISDS) after India cancelled 20 bilateral investment protection treaties with individual EU countries in 2016. The ISDS demand is not acceptable to India and current regulations require foreign investors to resolve their problems in Indian courts for a period of five years before pursuing a claim under international law.
India views the proposed trade deal as an opportunity to address issues it has with the way the two sides trade in services. In particular, India wants more visas to be granted to its skilled workers in the services industry. This has been a longstanding demand.
After Brexit, this demand is unlikely to fade. But, at a time when all EU member states are grappling with a “migration crisis” any loosening of visa rules is highly unlikely. India has also been demanding status as a “data-secure nation”, which will reduce compliance costs for Indian software providers. But, given EU concerns over regulatory norms and data-privacy standards it is unlikely that the EU will agree to this demand.
Opportunity for a UK trade deal?
The UK is among India’s main trading partners from the EU bloc. Trade totalled €13.6 billion in 2018, accounting for 17% of India’s overall trade with the EU. Moreover, trade between India and the UK increased at an average rate of 8.8% a year between 2002 and 2018.
Machinery and transport equipment constitute 40% of India’s exports, and accounts for nearly 20% of total UK’s trade with India. The UK’s exports of alcoholic beverages also registered a significant increase, from €14m to €162m from 2002-18.
The lack of progress in EU-India trade talks might just be an opportunity for the UK to launch its own negotiations for a trade deal with India. From an economic perspective, India is an attractive trade partner. It is projected to be the world’s fastest growing economy, with an annual GDP growth rate of around 6.5%. In the UK, GDP is predicted to grow by a mere 1.5% in 2019. India is also home to almost one-fifth of the world’s population. It could be a strategic partner for the UK in Asia, presenting an opportunity to increase Britain’s soft power in the region.
From India’s perspective, a trade deal with the UK could be an opportunity to increase pressure on other Asian countries, especially China, to liberalise their trade. This will also help India’s geopolitical considerations in the region given the history of tense diplomatic relations with Pakistan. And it could help strengthen India’s Commonwealth ties.
But other issues remain. The UK and India would still have to agree on reducing tariffs on their respective imports. Visa numbers and intellectual property would also be issues for the UK, as they were with the EU, and could yet prove contentious. So free trade talks between the UK and India could still be long and drawn out.
Recent political developments, however – including Brexit, eurozone uncertainty, sluggish global growth rates and trade tensions from the Trump administration’s pursuit of a protectionist agenda – all have serious implications for future trade talks. These could well nudge the partners to review their red lines and return to the negotiating table.
Three Conservative MPs resigned from their party to join The Independent Group of eight Labour MPs who earlier this week formed a breakaway centrist faction in parliament.
The three MPs — Sarah Wollaston, Heidi Allen and Anna Soubry — have been highly critical of Prime Minister Theresa May’s strategy on Brexit and have voted against the government on that issue.
In a joint letter to the prime minister they accuse May of a “shift to the right” and of being “firmly in the grip” of the Brexiteer group of backbenchers, the European Research Group, and the Democratic Unionist Party.
“Instead of seeking to heal the divisions or to tackle the underlying causes of Brexit, the priority was to draw up ‘red lines,’” they wrote. “The 48% were not only sidelined, they were alienated.
“The country deserves better. We believe there is a failure of politics in general, not just in the Conservative party but in both main parties as they move to the fringes, leaving millions of people with no representation. Our politics needs urgent and radical reform and we are determined to play our part.”
May’s conservatives do not have a majority in parliament and are only able to govern because of a confidence and supply deal with the DUP.
In its attempts to find a way out of the Brexit impasse, the House of Commons has passed an amendment that gives Theresa May the green light to reopen talks with the European Union about what happens to the Irish border after Brexit – a key sticking point in getting her deal through parliament.
MPs have also voted to reject a no-deal Brexit. And in a final development on a busy day in the Brexit story, opposition leader Jeremy Corbyn has also agreed to enter talks with the prime minister to find a way forward. But many of these developments raise more questions than they answer.
The Brady amendment
The Irish backstop is an issue which has caused frustration not just on the Conservative benches, but also with the government’s confidence-and-supply partner, the Democratic Unionist Party (DUP). The amendment which was passed on this topic was tabled by Graham Brady, a Conservative backbencher and chairman of the party’s 1922 Committee. It commits the prime minister to seeking “alternative arrangements” for the backstop, though during the debate that came ahead of the vote, government ministers repeatedly refused to be drawn on what those alternative arrangements might be.
As the countdown to March 29 continues, this will be seen by many as a sign that progress is being made as there is a majority in favour of an amended deal. Yet in parliamentary terms, the UK is no closer to leaving with a deal than it was in December. The prime minister still has a lot of work to do.
May nevertheless sees the amendment as giving her a firm mandate to return to the EU and seek a new version of the Brexit deal. In a further sign that she has heeded the concerns of her own backbenchers, the prime minister also agreed to sit down and discuss the so called “Malthouse Compromise” – a proposal on the backstop agreed in secret between Conservative Brexiteers and Remainers and facilitated by some government ministers. It is not a parliamentary amendment but is an important behind-the-scenes movement as the government strives to reach some sort of consensus among MPs.
That said, while the prime minister may have her mandate to push for an amended deal, the EU has said it does not wish to renegotiate terms. In a statement released shortly after the vote, a spokesman for European Council president Donald Tusk said: “The backstop is part of the withdrawal agreement and the withdrawal agreement is not open for re-negotiation.” May will be hoping that with 317 MPs firmly behind her, Brussels will shift ground.
MPs rejected a no-deal Brexit
The surprise of the night was a narrow eight-vote victory for an amendment tabled by Conservative MP Caroline Spelman and Labour MP Jack Dromey. It aims to prevent a no-deal Brexit, though it does not come with legal underpinnings. Although it’s unlikely that the government thought this amendment would pass, it’s potency is somewhat muted given that the prime minister has consistently said that passing amendments of this form are a waste of time; and that the only way to stop no deal is to vote for a deal. It’s unlikely to mean much, other than emphasising that there is a political will in the Commons to avoid leaving the EU on March 29 without a deal.
Corbyn agreed to talk
Jeremy Corbyn, the leader of the opposition, had refused any meetings with the prime minister over the past few weeks, saying repeatedly that he would not do so without preconditions being met, including the prime minister ruling out no deal. As a result, he is the only opposition party leader not to have met with May as she seeks consensus – although it should be noted that she initially extended the invitation to everyone except Corbyn. Yet Corbyn has now had a change of heart following the vote opposing a no deal exit and agreed to a meeting. This could prove highly significant over the next couple of weeks – movement on the Labour benches could help May’s next proposition cross the finish line.
Grieve and Cooper sunk
An amendment from Dominic Grieve, the Conservative backbencher who was largely responsible for forcing the government to come back to the Commons so soon after the meaningful vote last week failed to pass. The same went for Labour MP Yvette Cooper – whose amendment was only supported by leader of the opposition Jeremy Corbyn at the eleventh hour.
Both the Cooper and the Grieve amendments sought to suspend the usual Commons rules in which the government has control of business, and give more power to the Commons to control the Brexit process. The Grieve amendment would have allowed MPs to vote on a series of options for the withdrawal process, while the Cooper amendment sought to avoid a no-deal Brexit by making it legally binding on the prime minister to extend Article 50 if parliament had not agreed on a final Brexit deal by February 26. More MPs than expected voted against the Cooper amendment – perhaps a sign that Conservative MPs realised the Brady amendment would bring greater rewards.
What happens next?
The prime minister has said that she will go back to the EU and seek to reopen the Brexit package on offer. But with the EU currently saying it is unwilling to re-open talks on the deal, it is unclear at the moment what her next steps will be. She will, however, continue to meet with MPs including senior Conservative backbenchers and the DUP as she works towards an amended offer for parliament. With the clear majority voting against a no-deal Brexit, the ticking clock works in the prime minister’s favour. If the only way to avoid no deal is for parliament to take a favourable stance on an amended deal, they may have to support her deal in one form or another.
Parliament has a lot of work to do and it is running out of time in which to do it. There are limited sitting days between now and March 29, including a February recess. Assuming that an amended deal will be passed by the Commons next month, the house will still need to debate, (possibly) amend and pass a withdrawal agreement bill before the designated leave date. We may see the recess cancelled or the announcement of extra sitting days (Fridays could be used) between now and then. Either way, it’s going to be an even busier month for MPs as the Brexit clock ticks down.
As the clock ticks down to March 29 2019, all of the political manoeuvring, negotiating, arguing and fighting is coming to a peak. In the two and a half years since the 2016 EU referendum, views on both sides have hardened and agreement still seems as far away as it was the day after the referendum.
With Theresa May’s withdrawal agreement disliked by all sides, and voted down by an unprecedented majority in the House of Commons, everyone is wondering what can and should be done next?
While there are a number of options, some are more realistic than others. But in these turbulent times, it is impossible to conclusively rule any out. Here are some possibilities.
Present a new deal
Having seen her deal roundly rejected by parliament, the most obvious move for May might seem to be to go back to the EU to renegotiate. But the EU-27 have been clear from the day of the referendum result about what they were willing to offer. As the larger partner in the negotiations, and with a legal and political framework to protect, the EU could not rip up its own rules for one country. Indeed, the withdrawal agreement stretched the EU’s own red lines and they have repeatedly said that they could not, and would not, offer any more.
With the withdrawal agreement sunk, renegotiating with the EU along the same lines is a waste of time. The only type of renegotiation likely to have any chance of success is one where the larger issues, such as the customs union, are put back on the table. That seems to be something which May appears unwilling to do. It is hard to see how a new deal, without such renegotiation, would be any different to the old deal.
May has complained that while members of parliament have been very clear about what they won’t accept, they haven’t given any clear steer on what they will accept. That is undoubtedly true, largely because the House of Commons does not have a settled view of what the withdrawal agreement should look like or what the future relationship between the UK and EU should be.
In light of this, May has suggested that one way forward might be cross-party talks. But this is not an easy solution. May has enemies on all sides, with members of the Labour Party, Liberal Democrats, SNP and DUP all offering different solutions to her problem. Few of them will agree with May’s existing red lines, or with each other, making agreement almost impossible.
Another issue is the lack of time, with less than 80 days before the UK leaves the EU. Were these discussions to have taken place after the 2017 election, or when May became prime minister, agreement might just have been possible – but at this late stage, and with May appearing to be unwilling to compromise in any meaningful way, cross-party agreement looks unattainable.
Extend Article 50
The lack of time is an issue for Remainers and Leavers alike. Negotiation, a general election, another referendum – these all take time and Britain is scheduled to leave the EU on March 29. Article 50 could be extended, but this requires the agreement of the EU. In order for the UK to request this extension, and for the EU to agree, a practical plan of action would be needed to convince both sides that there was some point in an extension. While it is likely that an extension to article 50 may be sought, it is just a delay, not a solution.
For many of the 48% who voted to remain in the EU, a second referendum could be the answer to their prayers. Key Leave figures are under investigation for alleged irregularities during the referendum campaign and the British public are a lot more knowledgeable about the European Union now than they were in 2016. Another referendum might deliver a death blow to Brexit. However, there is no guarantee that it would deliver a Remain vote, and a vote could create even more divisions within society. The possibility of a second referendum is increasingly likely, but is still a long way off.
Of all the options, the only certainty is that if no further action is taken, no deals agreed, no referendum or general election, then the UK will leave the EU on March 29 with no deal. This would mean Britain would revert to trading on World Trade Organization rules. No other nation in the world trades exclusively on WTO rules and the economic damage would be extreme.
Delays at ports, and the issue of the Northern Irish border would also be hugely divisive and damaging for the UK economy. Trade deals take time, often years, to negotiate so the pain would not be short term for Britain. With no realistic benefits for the UK, it is hard to see why anyone would pursue this as a positive option.
None of the options open to the UK government and parliament are particularly attractive – and all have long-term costs – but the usual practice is that when the parliament of the UK cannot make a decision, the issue is put back to the public. Whether that can realistically be done now is hard to tell but no democracy should ever avoid the opinions of its own people.