Brexit Update: May into June

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Posted on June 4, 2018

Prime Minister May heads into June knowing that this is a critical month. She has both a major Brexit-focused cabinet meeting as well a European Council meeting later this month. Time is now getting short  for a prime minister without an internal political agreement in at cabinet nor, and just as important any consultation with the EU.

What has caught up with her?

PM May must still nail down within her own cabinet what the UK’s position will be on an alternative to the existing customs union and single market. So far she has come up with a temporary ’time limited goods arrangement’ which will keep the UK within the EU’s tariff system. This would serve to extend the timing to sort out the land border with Northern Ireland, i.e., to keep an open border whilst respecting it is a border with the EU. All previous plans have fallen foul of the Irish Government, her own cabinet, the EU and perhaps most importantly, any notions of practicality. Irish Taoiseach Varadkar has said that so far any proposals don’t ‘remotely approach’ a workable solution.

And what will she do?

She will try and kick the can down the road and continue to fudge any framework as she knows she continues to be unlikely to gain full cabinet support. It is, after all, all about politics. The PM is finding it increasingly difficulty too to keep the DUP of Northern Ireland happy and it is of course the DUP on whom she relies for support of her government. This strain has heightened following the referendum in Ireland on access to abortion. Northern Ireland is now one of the only places in the West (except Malta) where it is so restrictive. The DUP would not move their anti-Abortion position despite any sense of pressure from Westminster. Could this bring May’s government down? Almost certainly not, but it has at least frayed and tested the difficult relationship.

Hanging by a thread

An internal government report has just been released saying that if the UK is unable to do a deal with the EU by the time the UK leaves the EU in March 2019, a ‘doomsday’ scenario will result:

  • The Port of Dover will collapse on Day 1;
  • Supermarkets in Cornwall in the West and Scotland will run out of food in two days;
  • Hospitals will run out of medicine within two weeks;
  • The Royal Air Force will have to transport emergency medical supplies to the furthest corners of the UK;
  • The country will run out of fuel for car/diesel vehicles.

The government whilst accepting that these discussions had taken place as part of the planning process, are underplaying the chance of them happening.

What is next? Another referendum? 

Unlikely, although the Prime Minister now will definitely have to get parliamentary sign-off to any deal. The chink in her armour, if indeed she has any form of protection at all, is that she is unlikely due to sheer lack of numbers, to get Parliamentary agreement on the whole deal especially when it comes to a customs union which is worse than what currently exists. It has also yet to be resolved whether the UK public will have any say on the terms of a final agreement. There is a growing clamour for another referendum or some form of public input into the terms of departure, but at the moment it has failed generate necessary levels of support. That may change as March draws closer.

A steely resolve? 

The UK, similarly to Canada has been caught up with Trump’s steel tariffs. The UK exports some 350,000 tons of specialized steel annually to the US and has now been caught by the same punitive tariffs. There are two issues here, the damage to the UK’s already struggling steel industry, but equally damaging to PM May is that this does not fit the narrative that the ‘US is keen to do a post-Brexit trade deal with the UK’. The message of Trump’s America First is resonating as much this side of the Atlantic as in Canada.

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