Brexit 5: Government of last resort?

By Saagar Dattani August 16, 2019 2:20 pm

Corbyn at the wheel? Tell me how does it feel?

Jeremy Corbyn has asked rival parties to support him block a no-deal Brexit by forming “a strictly time-limited temporary government”. As leader of this “unity government”, Corbyn would call for a general election if they and rebel Conservatives oust Boris’ government in a no-confidence vote. Interestingly, Corbyn put in an all too familiar caveat: – to table the vote of no-confidence “at the earliest opportunity when we can be confident of success.”

Initial reactions to this have been mixed. The Green’s and Plaid Cymru both knocked back Corbyn’s approach, calling on him to back an extension to Article 50 and a second referendum ahead of pursuing a general election. Anna Soubry, leader The Independent Group for Change and who was not sent the letter by Mr Corbyn, has unequivocally shut down the idea of voting for Corbyn, and Jo Swinson, leader of the Lib Dems, followed suit, instead calling for a more palatable figure, such as Ken Clarke or Harriet Harman, to lead the unity government. However, Swinson has since softened her stance, agreeing to enter discussions with Corbyn, whilst maintaining the current plan is “unviable”.

It’s likely that the rebel alliance – forming amongst a faction of disheartened Tory Europhile MPs – may be Corbyn’s best bet at getting his hands on power at Westminster.

Rebels vs. Boris: Round One

A new anti-Boris ‘rebel alliance’ seems to be forming behind the scenes in government, led by former chancellor Phillip Hammond. Starting off the week by launching scathing attacks on Johnson and Dominic Cummings, Hammond claimed that pursuing no-deal was a grand betrayal of those who voted Brexit in 2016 and will cost jobs, investment and risk the break-up of the Union. He also warned, in a letter signed by 20 other senior Tory MPs, that Johnson’s Brexit red lines mean there is “no realistic probability of a deal being done” with the EU.

Hammond’s intervention, however, may not even be the biggest concern on No.10’s plate right now.

If one thing is certain in all this Brexit madness, it is that the Speaker of the House John Bercow will not let Boris force through a no-deal Brexit without resistance. “The one thing I feel strongly about is that the House of Commons must have its way,” he said at the Edinburgh Fringe festival earlier this week. “And if there is an attempt to circumvent, to bypass or — God forbid! — to close down parliament… I will fight it with every bone in my body to stop that happening.” MPs return from their summer recess on 3 September…

Bolton and Pelosi divided over future US-UK trade deal

Earlier this week, Donald Trump’s national security adviser John Bolton failed to hide his enthusiasm when questioned on the thought of the UK leaving the EU without a deal. “We’re with you, we’re with you,” Bolton told reporters when discussing Johnson’s approach – or lack of, more accurately – to negotiations with our EU counterparts. Bolton proclaimed Britain and the US could agree trade deals on a sector-by-sector basis, leaving more difficult areas in the trading relationship until later.

However, Democrat and Speaker of the House of Representatives Nancy Pelosi swiftly rebutted Bolton’s assertion that Britain will be at “the front of the trade queue” for a deal with the US, warning that Brexit “cannot be allowed to imperil the Good Friday Agreement”.

The key question here is: To what length is Johnson’s government willing to go to drive through a trade deal with the US? Where would this leave us in terms of our relationship with the EU? And what would this mean for key areas of our economy most likely to be hit by a no-deal Brexit i.e. the NHS, national security, and foreign policy?

Tilting on the brink of recession?

Last week, the pound hit a two-year low as GDP contracted by 0.2 percent for the first time since the fourth quarter of 2012. Economists are primarily putting this down to the escalating trade war between the US and China, but also recognise that companies will be rushing to stockpile goods ahead of the October 31 deadline, which may cause a bounce in GDP during the third quarter. Both the Bank of England and Chancellor of the Exchequer Sajid Javid have now come to loggerheads, with the former hypothesising a one in three chance of plunging into recession, whilst the latter has taken a more bullish approach by quickly dispelling fears of the UK plunging into recession. If the worst does arrive at the UK’s doorstep, what will that spell for the government’s hawkish spending commitments?

DHSC announce “emergency freight service” for medicinal products

Amid fears that key supply chains could face disruption if tariffs are ramped up in the event of a no-deal Brexit, the Department for Health and Social Care (DHSC) has franticly launched a bid to identify a company which could run a £25m “express freight service” contract to support the continuity of supply of medicines and medicinal products into the UK.

Many firms, particularly those which rely on just-in-time supply chains, have stepped up no-deal preparations since 2017. However, there are still hundreds of companies and suppliers that will have to reroute supply lines overnight. Not only does this move highlight Britain’s reliance on the EU to import drugs and medical equipment, but equally demonstrates the risks that lay in store for front-line services and patients should an agreement not be reached.

The Whitehouse team are experts in the potential impact of Brexit, providing political consultancy and public affairs advice to a wide range of clients, not only in the United Kingdom, but also across the member states of the European Union. More information about our Brexit experience can be found here, or, if you have any questions, please contact our Chair, Chris Whitehouse, at chris.whitehouse@whitehouseconsulting.co.uk.

By Saagar Dattani August 16, 2019 2:20 pm

*/?>

Sign up to receive analysis on policy developments across our specialist sectors








Contact us

For more information about how Whitehouse can help you, please contact:

Isabella Sharp
t: +44 (0)20 7793 2536
m: +44 (0)7813 307490
isabella.sharp@whitehouseconsulting.co.uk

Viviana Spaghetti
t: +44 (0)20 7463 0668
m: +44 (0)7583 051119
viviana.spaghetti@whitehouseconsulting.co.uk

For media enquiries, please contact:
Mayar Raouf

t: +44 (0)20 7463 0698
m: +44 (0)7502 327092
mayar.raouf@whitehouseconsulting.co.uk

For general enquiries, please contact:
info@whitehouseconsulting.co.uk
t: +44 (0)20 7463 0690

Sign up for the latest news

  • * Denotes required fields
  • This field is for validation purposes and should be left unchanged.