Brexit: Wednesday Afternoon Update

Managing Director
Read Post

Posted on July 13, 2016

Story of the Day: May’s Day
Outgoing Prime Minister David Cameron addressed the House of Commons for the final time in his role today, prompting a roaring standing ovation from the Tories and applause from both sides of the aisle. The mood was much lighter than it has been in recent weeks and Cameron’s performance was more comparable to light entertainment than politics – and frankly, just what was needed. In his speech, he looked back at the ‘many amazing moments’ in his six years as PM, joking that he too was ‘once the future’. He also continued that the Tories have wrapped up their leadership race in just two weeks, while the Labour Party ‘hasn’t even figured out the rules yet.’
Following the address, Cameron made his way to Buckingham Palace to meet with the Queen and submit his resignation. He was followed by Theresa May some 10 minutes later. Theresa May was then sworn in, formally assuming the role of Prime Minister.

Theresa May, the 13th Prime Minister of the Queen’s reign, returned to No 10 after her appointment and gave a short speech on her priorities, emphasizing the need for unity and social justice. We forget that, as Brexit has dominated the UK for the last three weeks, there is still a country to run. Prime Minister May outlined her vision of “one nation Toryism” with opportunities for all and was clear about wanting to unite the United Kingdom, including Scotland, Wales and Northern Ireland.

This evening May will be briefed on defence and security policies, particularly those concerning nuclear threats, nuclear responses, and the UK’s Trident program. May’s immediate agenda will then be to establish her cabinet and appoint a leader in charge of negotiations with the EU. As of this afternoon, former Foreign Secretary Philip Hammond has been confirmed as the Chancellor of the Ex-Chequer. More appointments will follow.

Prime Minister May’s cabinet will very likely incorporate a more balanced ratio of men and women than ever before – very much in line with Canadian Prime Minister Justin Trudeau, as it is, after all, 2016.
Labour Party
Labour Leader Jeremy Corbyn came out victorious in yesterday’s vote by Labour’s National Executive Committee (NEC). In an 18-14 ruling, it was decided, against precedent, that the Leader of the Party is allowed the automatic right to appear on the election ballot without the otherwise mandatory 20 per cent support from MPs.
Unfortunately, it has since come to light that a shocking level of intimidation and bullying occurred to secure Corbyn’s win. Prior to the vote, it was explained to members of the NEC that High Court action would be taken against both the outcome and individual members of the committee if it did not vote in favour of Corbyn’s automatic right. Personal contact information of some of the NEC members was also released online, prompting thousands of messages of intimidation. While Jeremy Corbyn maintained that he stands against any intimidation, a shaken and teary Joanna Baxter, who has been on the NEC for six years, explained that Corbyn also voted against a secret ballot vote, arguing that NEC members must be accountable.

So with that, Corbyn won the right to ignore his MPs and the rest of the party, leading the Labour Whip’s office to resign. With 75 per cent of Labour MPs now opposing Jeremy Corbyn, he has put his own ambitions before those of the party and the prospect for the splintering of the party is greatly enhanced.

One check was placed on Corbyn’s seemingly absolute power within his party last night. It is now policy that party membership comes at a price of ᆪ25, increasing from just ᆪ3. If an individual has been a member for less than six months, they are required to re-register for the new fee if they wish to vote in the leadership race. 130,000 new members have joined the Labour Party since the referendum, all of whom are subject to the policy.

Labour leadership contenders Angela Eagle and Owen Smith have both officially announced their bids. The leadership campaign is expected to last two months, but by the end of this week, expect for only one of the two Corbyn opponents to remain in the race.
Markets
For the first time in over seven years, it is very likely that the Bank of England will cut interest rates on Thursday. This measure is aimed at reassuring markets and households during the coming months and years of uncertainty. It is believed that rates will be cut from 0.5 per cent to 0.25 per cent.
Sterling is on its way to its longest winning streak in two months due to Theresa May’s takeover, gaining value for its fourth consecutive day. While still down 11 per cent since the referendum, it spiked to $1.3338 today, although later slipping and currently trading at around $1.32.

Meanwhile the FTSE indices and markets across Europe experienced a quiet day of relative inactivity.
What a day.

Five Must-Read Articles

To speak to someone on the ground in London, connect directly with our London lead Ashley Prime at aprime@navltd.com.

Navigator's Brexit Response Team

If you have any questions on the implications of Brexit and its implications for your organization, please reach out to Navigator's Brexit Response Team.

If you require immediate assistance, call our crisis response hotline at:

Press 3 for the on-call crisis manager

1 (877) 431-9721

More Updates from

Buying time?

Managing Director
More

Summer’s Over

Managing Director
More

A Realistic Brexit?

Managing Director
More
Subscribe