Brexit Update: Still Hanging On | Brexit Update | PKF Francis Clark
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Brexit Update: Still Hanging On

Following on from Wednesday evening’s statement from the Prime Minister and the publication of the draft withdrawal agreement and future relationship document, Thursday was one of the most dramatic days in British politics in recent years.

Dominic Raab Resignation

It started with the resignation of the Brexit Secretary, Dominic Raab, and was punctuated by the departures of further members of the government, each lining up to say that they could not support the deal put forward by Theresa May.

In a mammoth three-hour statement to the House of Commons the Prime Minister insisted her deal was the only option available, but succeeded only in uniting Parliament against the draft agreement, with all but a handful of MPs from all parts of the house declaring that they would vote against it.

Letters of no confidence

To add to Theresa May’s woes, a number of her MPs throughout the day declared they were submitting letters of no confidence to trigger a party leadership challenge, crucially including the leader of the European Research Group, Jacob Rees-Mogg, who urged other members of the group to follow suit.

As of this morning there was no news on whether the 48 letters required to trigger a vote of no confidence had been submitted, but the Prime Minister’s position is clearly under serious threat and it is not clear whether she will be able to fill key cabinet vacancies, with further resignations expected today. It is also hard to see any realistic possibility of the proposed deal passing a vote in Parliament given that all opposition parties and many Conservative MPs have said they would vote against it.

Because of this, many people expected the Prime Minister to either acknowledge that her deal would not pass, or even resign, when she called a press conference for 5pm yesterday. In the event she did neither, insisting again that her deal was in the national interest and that she would press ahead with taking it to an EU summit next weekend before bringing it to a vote in Parliament.

What next?

The position remains unstable and there are likely to be plenty of developments in the course of today, but for the time being the stated position of the U.K. government is that the withdrawal agreement in its present form sets out the terms of the UK’s departure from the EU and will not be changed. s.

Daniel Sladen Partner said:

“In the event that the agreement does manage to get through the UK political process and the EU summit pencilled in for next weekend, it would provide some reassurance for businesses as the transition period to 31 December 2020 will then go ahead, meaning nothing significant will change for two years.

“However even with this agreement, the longer term future remains difficult to predict, as its content regarding the future relationship is long on aspiration and short on detail. The range of possible outcomes goes from a lengthy extension to the transition period, to a customs arrangement or free trade area which reduces, but doesn’t eliminate, border friction and leaves the UK adopting EU rules in many areas. In short, uncertainty about the future will continue even if the agreement survives, so businesses shouldn’t stop preparing for a cliff-edge.”

Our overview of the agreement and the future relationship analyses some of the key points and potential issues arising from these documents, and we will continue to provide updates as the position evolves.

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