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May’s Brexit Deal Routed With Extension Now Seen as `Inevitable’

By Bloomberg 12 March 2019
Caption
A grab from a handout video made available by the UK Parliamentary Recording Unit shows British Prime Minister Theresa May in the House of Commons parliament in London, Britain, 12 March 2019. MPs defeated her Brexit deal by 149 votes. The United Kingdom is officially due to leave the European Union on 29 March 2019, two years after triggering Article 50 in consequence to a referendum. EPA-EFE/UK PARLIAMENTARY RECORDING UNIT / HANDOUT MANDATORY CREDIT: UK PARLIAMENTARY RECORDING UNIT HANDOUT EDITORIAL USE ONLY/NO SALES HANDOUT EDITORIAL USE ONLY/NO SALES HANDOUT EDITORIAL USE ONLY/NO SALES HANDOUT EDITORIAL USE ONLY/NO SALES HANDOUT EDITORIAL USE ONLY/NO SALES

U.K. Prime Minister Theresa May’s Brexit deal was rejected once again by Parliament, throwing the country deeper into political crisis and raising the prospect that the divorce will be delayed or even reversed.

Renegotiated late on Monday night, the latest version of the deal was defeated by 391 votes to 242. That’s less than the record 230-vote margin she suffered in January, but still a stinging repudiation of two years of painstaking work.

Attorney General Geoffrey Cox, whose damning assessment on the new terms meant critics held firm, said in an interview that an extension to the U.K’s departure date from the European Union beyond March 29 was “inevitable.”

In fact with the deal all but dead, Parliament will probably vote to postpone Brexit this week, and lawmakers — including some of May’s own Cabinet — will likely try to maneuver to force the government to rip up its Brexit plans and start again.

Members of Parliament are expected to vote Wednesday to take a chaotic no-deal option off the table. May said she’ll offer a free vote, meaning the government will not whip Conservative lawmakers to take a particular side.

But there’s a risk all they manage to do is postpone the drama for another few months. It was notable that she included a second referendum on Brexit among the choices Parliament may face in coming months. The pound pared losses after May spoke.

What Next?

“Voting against leaving without a deal and for an extension does not solve the problems we face,” May said. “I continue to believe that by far the best outcome is that the U.K. leaves the EU in an orderly fashion with a deal, and that the deal we have negotiated is the best and indeed the only deal available.”

A spokesman for EU President Donald Tusk said the result increases the risk of the U.K. crashing out the bloc without a deal. He said the EU will consider any request from the government to delay Brexit day but there needs to be a “credible justification for a possible extension and its duration.”

The EU has done “all that is possible to reach an agreement” and the solution to the deadlock “can only be found in London.”

May’s job, which she has clung to through one crisis after another, is now in greater peril than ever.

May herself has said that if her deal was rejected, Parliament would force the U.K. to maintain closer ties with the bloc in a betrayal of the referendum result of 2016. She’s also warned of the risk that the divorce would be stopped altogether, and her latest comments will likely boost campaigners who want the U.K.’s membership of the EU to put to another public vote.

The prime minister wielded the threat of Brexit being blocked to try to get hardline Brexit backers to support her deal. But in the end it wasn’t enough. They object to her deal more than they fear another plebiscite. That’s because they see a risk that the agreement will keep the U.K. chained to EU rules forever, and consider that even worse than membership.

Dashed Hopes

May was sent back to Brussels to renegotiate the deal and while she didn’t come back with what she wanted, she did secure some key tweaks.

But hopes they would swing skeptical lawmakers behind her were quickly dashed. Cox issued new legal advice warning that the risks hadn’t changed for the U.K. Then the pro-Brexit European Research Group of Tories urged Conservatives not to support May’s new exit agreement, and the Democratic Unionist Party, which props up May’s minority Tory government, also criticized it.

Why Ireland’s Border Commands Its Own Brexit Backstop: QuickTake

With just 17 days left until the U.K.’s scheduled departure date, talks have been stuck on the same issue that has blocked progress for the past year: the backup plan intended to ensure there’s never any need for customs checks at the land border between Ireland and the U.K.

Pro-Brexit politicians in May’s Tory party insist that the plan — known as the backstop — threatens to trap the U.K. inside the EU’s trade regime forever, because it would be impossible for Britain to leave. In his legal advice on the revised deal, Cox said the risk of this has been reduced, but not eliminated. DM

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