22 March 2019

EU grants unconditional Article 50 extension until April 12

EU 27 leaders yesterday agreed to extend Article 50 until 22 May, provided the Withdrawal Agreement is approved by the House of Commons next week. If it is not, the EU agrees to extend Article 50 until April 12, by which point the UK government is expected to indicate a way forward.

European Council President Donald Tusk said in a press conference, “Until [April 12], all options will remain open and the cliff-edge date will be delayed. The UK government will still have a choice between a deal, No Deal, a long extension or revoking Article 50,” adding, “The 12th of April is a key date in terms of the UK deciding whether to hold European Parliament elections. If it has not decided to do so by then, the option of a long extension will automatically become impossible.”

After the meeting, Prime Minister Theresa May said in a statement, “If Parliament does not agree a deal next week, the EU Council will extend Article 50 until 12 April. At this point we would either leave with No Deal, or put forward an alternative plan,” adding, “What the decision today underlines is the importance of the House of Commons passing a Brexit deal next week so that we can bring an end to the uncertainty and leave in a smooth and orderly manner.” May also said she would return to the UK this morning to continue “working hard to build support for getting the deal through,” adding, “I know MPs on all sides of the debate have passionate views, and I respect those different positions. Last night I expressed my frustration. I know that MPs are frustrated too. They have difficult jobs to do.I hope we can all agree, we are now at the moment of decision.”

After the Council, French President Emmanuel Macron commented, “It’s a real political and democratic crisis. But this crisis is a British one. It’s now up to the British to end the ambiguities.” EU chief Brexit negotiator Michel Barnier said, “It’s not a deal. It’s a step in the process. We are constructive and patient.”

Source: The Guardian The Financial Times UK Government The Times

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French President: MPs rejecting Brexit deal will "guide everyone towards No Deal"

Arriving at the European Council summit yesterday, French President Emmanuel Macron said that if the UK Parliament votes for the Brexit deal next week, he is open to a “technical extension [which] should be as short as possible,” adding, “In the case of a negative vote in the British Parliament, directly, it will guide everyone towards No Deal.” He added, “[There will be] no extension to negotiate a Withdrawal Agreement…[and] no extension if there is no clear majority to provide a mandate for the future relationship.” Macron also said, “It is a matter of the good functioning of the EU. We cannot have what I would call an excessive extension that would harm our capacity to decision and to act.” The Prime Minister of Luxembourg, Xavier Bettel, said, “If next week we are not able to find agreement in the House of Commons we are going in the direction of No Deal,” adding that the longest technical extension the EU could agree to is “before European elections – after that, impossible.”

Elsewhere, Irish Prime Minister Leo Varadkar said, “I think there is an openness to an extension across the [EU27]. Everyone wants to avoid No Deal. But we can’t have a situation where we have a rolling cliff edge, where we just put off decisions and deadlines every couple of months.” He added, “I think we all appreciate that the situation in London is somewhat chaotic at the moment, and for that reason I think we need to cut the entire British establishment a little bit of slack on this.” German Chancellor Angela Merkel said the EU should “work to the last minute to ensure we can have an orderly Brexit,” adding, “But we also have to prepare for the possibility of that not happening, and then we will decide what to do if that happens.”

Separately, Latvian Prime Minister Krisjanis Karins warned that if UK MPs reject the deal next week, “There are then two alternatives: either Great Britain withdraws Article 50 and stays in the European Union, or there is a disorderly withdrawal.” Dutch Prime Minister Mark Rutte also said, “We will give [Theresa] May a short delay, as long as MPs do their bit too.”

Source: The Guardian I The Guardian II The Irish Times Reuters

Theresa May: short extension gives Parliament time to deliver on the result of the referendum

Speaking to reporters at the European Council summit yesterday, Prime Minister Theresa May said that the proposed delay to Brexit “is a matter of personal regret to me. But a short extension would give Parliament the time to make a final choice that delivers on the result of the referendum.” She refused to answer what would happen if Parliament voted against her deal again next week, instead saying, “what matters is that we recognise that Brexit is the decision of the British people.” Elsewhere, the Financial Times reports that the Prime Minister is considering leaving without a deal if her deal does not pass in the House of Commons.

Also speaking in Brussels, Labour leader Jeremy Corbyn refused to rule out Labour support for revoking Article 50 – though he said such questions were “hypotheticals.” Corbyn added, “We think that what we are proposing can be achieved in the British Parliament. We do believe we can construct a majority which will prevent… all the chaos that will come from crashing out [with No Deal].” Corbyn also said his meetings in Brussels with EU officials, including EU chief Brexit negotiator Michel Barnier and European Commission Secretary General Martin Selmayr, had been “positive.” Separately, he said that he would be meeting the Prime Minister on a one-to-one basis next week. A Labour spokesman later said, “We do not believe that revoking Article 50 is in any way necessary.”

An online petition hosted by Parliament’s Petitions Committee calling for Article 50 to be revoked reached over 2 million signatures yesterday. However, Leader of the House of Commons Andrea Leadsom said that the petition was not on scale with the 2016 referendum. She said, “Should it reach 17.4 million respondents then I am sure there will be a very clear case for taking action,” adding, “It’s absolutely right that people do have the opportunity to put their views and that can then spark yet another Brexit debate.” Elsewhere, Foreign Secretary Jeremy Hunt told BBC Radio 4’s Today that cancelling Brexit by revoking Article 50 is “highly unlikely.”

In a separate online poll by Sky News, readers were asked if they think Theresa May is “on their side” over Brexit. Results showed that 35% said yes, while 51% replied no, with 14% unsure. The survey also showed that the majority of readers thought MPs were to blame for the Brexit situation, rather than the Prime Minister.

Speaking on BBC Radio Ulster’s Talkback programme, Open Europe’s Henry Newman said criticisms of the Withdrawal Agreement “are fair, but this is not only Theresa May’s deal, this is the only deal agreed with the EU…and they will not agree a new divorce deal,” adding, “MPs need to face the real choices…If they want to deliver an orderly Brexit, a version of this deal is the only way forward.” He also told BBC News yesterday, “Europe will not refuse an extension as they do not want to be in a position where they are blamed for No Deal. Whatever happens we are likely to have an extension, so we are not likely to face No Deal in nine days’ time,” adding, “The Prime Minister needs to set out a timetable for her own departure” in order to convince many MPs to vote for the deal.

Separately, Open Europe’s Aarti Shankar told BBC News yesterday that the question of what happens if the deal is voted down remains open-ended, explaining, “If MPs don’t pass the deal next week, what is it that happens next? The Prime Minister has tried to use this ambiguity to her advantage in order to ensure that Labour MPs can back the deal if they are afraid of No Deal and Eurosceptic MPs can back the deal if they are afraid of a long extension.”

Source: The Guardian The Financial Times BBC Sky News Open Europe Sound Cloud Open Europe YouTube Open Europe YouTube

The Telegraph: Chairman of 1922 Committee tells Theresa May Tory MPs want her to quit

The Telegraph reports this morning that the Chairman of the 1922 Committee of Conservative backbenchers, Sir Graham Brady, has told Theresa May that Conservative MPs want her to resign as Prime Minister over Brexit. Brady visited Downing Street on Monday after he was “bombarded with text messages” from colleagues urging him to confront the Prime Minister.

Separately, Chief Secretary to the Treasury Liz Truss said yesterday that she views a No Deal Brexit as preferable to a long extension to Article 50.

This comes as a cross-party group of MPs led by Conservative MP Oliver Letwin and Labour MP Yvette Cooper yesterday put forward an amendment to the Government’s motion setting out ways forward for the UK’s withdrawal, which would allow Parliament to vote on a series of alternative Brexit options next week.

Source: The Telegraph The Guardian Politico London Playbook

New report: International students who stay in UK contribute £3.2 billion to economy

A new report by the Higher Education Policy Institute (HEPI) and Kaplan International Pathways (Kaplan) has found that international students who enter and remain in the UK labour market after graduation make “sizeable economic contributions” to the UK economy. Using data from London Economics, the study found that students from the 2016/17 cohort had contributed £3.2 billion to the UK economy in tax and National Insurance Payments. Of this, graduates from other EU countries contribute £1.2 billion. The report also found that rather than displacing domestic graduates from opportunities, international graduates play a “key role” in reducing labour market gaps.

This comes as Linda Cowan, Vice President of Kaplan, said the UK needs “to reinstate attractive and competitive post-study work rights for all international students,” while HEPI Director Nick Hillman said the Migration Advisory Committee (MAC) should change its advice to the Government on post-work study rights.

Source: HEPI Times Higher Education

TUC and CBI: the UK is facing a “national emergency”

In an open letter to Prime Minister Theresa May, General Secretary of the Trade Union Congress(TUC), Frances O’Grady and Director General of the Confederate for British Industry(CBI) , Carolyn Fairbairn, warned that the UK is facing a “national emergency,” and made three suggestions for a plan B. The letter said, “Together we represent millions of workers and tens of thousands of businesses. It is on their behalf that we are writing to you to ask you to change your Brexit approach,” adding, “Our country is facing a national emergency. Decisions of recent days have caused the risk of no deal to soar. Firms and communities across the UK are not ready for this outcome. The shock to our economy would be felt by generations to come.”

Source: The Guardian

Ministry of Defence prepares Whitehall bunker for No Deal scenario

The Ministry of Defence (MoD) has prepared an operations room in a bunker in Whitehall as part of their preparations for No Deal Brexit. If necessary, the bunker will be used to coordinate efforts in the event of No Deal Brexit. An MoD spokesperson said the ministry is “always willing to support wider government planning for any scenario,” adding, “We have committed to holding 3,500 troops at readiness to aid contingency plans. We will consider any requests from other government departments if they feel defence capability could contribute to their no-deal planning.”

Source: BBC

Bank of England keeps interest rates at 0.75%

The Bank of England Monetary Policy Committee yesterday voted unanimously to keep interest rates at 0.75%. During the MPC’s meeting on Wednesday, the Committee expressed the view that shifting expectations regarding the UK’s departure from the EU has generated volatility in UK asset prices, damaging business confidence and short-term investment, but that employment growth was strong. CPI inflation reached 1.9% in February. The MPC reaffirmed that its monetary policy response to Brexit would not be automatic and could head in either direction.

Meanwhile, Barclays’ chairman John McFarlane said yesterday, “In the event of a No Deal situation, this would hurt the EU very significantly if that was the case, and that would quickly resolve into some form of arrangement… On 30th of March, whatever happens, the European capital market will be in London.” This comes as Policy Chair at the City of London Corporation said, “It’s imperative we avoid a No Deal Brexit,” adding, “An extension would be welcome and let’s hope our EU partners agree to that. But it would only be a sticking plaster unless the deep underlying issues are resolved and we actually make progress.”

Source: Bank of England Reuters

Any Brexit likely to cause economic losses for UK and EU, German study warns

German think tank Bertelsmann Stiftung released a study yesterday suggesting that all Brexit outcomes would entail an economic hit for both the UK and EU. A “hard” Brexit, defined as leaving without a deal, would lead to the highest economic losses for both the UK and EU, with the UK facing a €57.3 billion annual hit, versus €40.4 billion for the EU 27. The largest individual cost for any member state would be faced by Germany, projected to lose €9.5 billion, followed by France at €8 billion. According to the economist Dominic Ponattu, one of the study’s authors, “regions affected the most are typically those that have strong industry, for example the automotive industry in countries like Germany”.

The study found that a “softer” Brexit, with closer economic integration between the UK and the EU would be considerably less damaging, however. The UK economy would face losses of around €32 billion a year, whilst the EU 27 would lose around €22 billion. Furthermore, the study found that some non-EU countries could gain from Brexit.

Source: Politico EU Deutsche Welle Euronews

EU leaders to discuss "reciprocity" in public procurement

EU leaders will today discuss proposals to create a new law enforcing “reciprocity for public procurement with third countries.” A number of EU nations have expressed frustration that their businesses have been excluded from bidding for projects in China, while Chinese companies are able to bid for public contracts in their own countries. The new law would make it more difficult for businesses in third countries, especially China, to win public contracts in the EU.

Source: Politico EU