Brexit deadlock: Going through the motions

Two came close to gaining a majority, both proposing a stronger relationship with the European Union than May’s deal offers. The option that came closest, known as the “deal plus customs union,” would allow MPs to back the prime minister’s withdrawal agreement in exchange for a commitment for the United Kingdom to remain in a customs union with the European Union. This arrangement would give the country a closer trading relationship with the European Union and reduce the need for some (but not all) checks at the Irish border, which would go some way to removing the need for “the backstop” designed to prevent a hard border between Northern Ireland and the Republic of Ireland.

However, leaving the customs union has always been one of May’s “red lines”—an issue not up for debate—as still being part of a permanent customs union with the European Union would stop the United Kingdom making its own independent trade deals with other countries (such as the United States).

Still, the vote was a close call and only lost by eight votes (with 264 for versus 272 against).

“A messy and disorderly exit would not just be deeply irresponsible—it would be a flagrant dereliction of duty. …We in business must make it clear that our elected representatives cannot keep chasing rainbows.”

Adam Marshall, Director General, British Chambers of Commerce

The chance of a second referendum came a surprise second—in fact, more MPs voted for the idea of another referendum than voted for May’s deal the two times it had been put to Parliament.

Defeated by just 27 votes (268 for, 295 against), this option would have required the public to agree to any Brexit deal through a “confirmatory referendum.” However, given the simplicity of the original referendum—a “yes/no” vote to leave the European Union (without any explanation as to how that could be achieved or what Brexit would look like on paper)—MPs would make the ultimate decision as to how the question on the ballot paper would be phrased. And given the lack of consensus on Brexit generally in the Commons, agreement on the text might take a long time.

Labour’s “alternative plan” to remain in a customs union and have a “close alignment” with the single market, whereby the United Kingdom could “influence” future EU trade talks without being actively involved in them, was also kiboshed (237 for, 307 against). Besides the obvious reluctance of Conservative MPs to back a motion proposed by the opposition party, Labour’s plan might have also stumbled over uncertainty surrounding the nature of any such “close alignment,” as EU law does not currently allow non-EU members to have a formal say or veto in its trade talks. Labour, however, insists that the European Union has shown “flexibility” in the past, and its proposal cannot be ruled out until the party has had a chance to negotiate formally.

Another proposition to retain strong ties with the European Union and the benefits of the single market was also rejected (188 for, 283 against). Known as “Common market 2.0” or “Norway plus,” this option would involve the United Kingdom joining Norway, Iceland, Switzerland, and Liechtenstein as part of the European Free Trade Association (EFTA).

But while the country would enjoy the advantages of frictionless, tariff-less trade, it would mean that the United Kingdom would need to pay into the EU budget and follow many of the EU’s rules and regulations (without having a say in how they are drafted), as well as retain freedom of movement (the right of EU citizens to live and work in the United Kingdom and vice-versa)—abandoning another of May’s “red lines.” Under the plan, the United Kingdom would also remain in a customs union until an alternative plan to avoid a hard border in Ireland was found—a situation that would hardly appease Northern Ireland’s Democratic Unionist Party (DUP), upon whose support May relies.

The remaining four motions were roundly defeated. A motion calling to revoke Article 50—the legal mechanism that triggered the two-year countdown for Brexit to take place (and which has been extended by two weeks at least)—lost by 109 votes (184 for, 293 against), while another to prevent a “no-deal” Brexit from happening was trounced by 240 votes (160 for, 400 against). As such, a “no deal” scenario remains the default legal position if an alternative plan is not put forward and/or the European Union does not extend Brexit negotiations further.

A motion to implement a sort of “standstill agreement,” whereby the United Kingdom leaves the European Union without a deal but each honours a reciprocal agreement to recognise each other’s rules and regulations for up to two years, lost (422 votes to 139), while an option that would allow the United Kingdom to participate in the single market and EFTA but leave the customs union and thereby have the freedom to sign its own trade deals was rejected by a margin of 312 MPs (65 for, 377 against).

So, what happens next? As often is the case with Brexit, no one in authority is sure. Several MPs had thought the three options that had enjoyed the most support—deal plus customs union; a confirmatory referendum; and Labour’s alternative Brexit plan—would be up for debate again on Monday, with the voting system possibly changing so MPs would be asked to vote in order of preference.

However, Thursday’s announcement by the government that MPs will be asked to vote again on part of May’s Brexit deal on Friday (29 March—the day Brexit was supposed to happen) has put another spanner in the works.

Rather than being a third “meaningful” vote, MPs will be asked to vote on the withdrawal agreement on the Irish “backstop,” EU divorce bill, and citizens’ rights—but they will not vote on the U.K.’s future relationship with the European Union. Opposition parties say the government is effectively trying to split the vote in half by trying to separate the parts of the Withdrawal Agreement that might gain a parliamentary majority away from those areas that have proved more contentious. EU leaders, however, might welcome the tactic as a way of moving forward.

U.K. business groups have become exasperated with Westminster over the past week. Adam Marshall, director general of the British Chambers of Commerce, slammed MPs when he told an audience Thursday that “we are frustrated. We are angry. You have let British business down. You have focused on soundbites, not substance. Tactics, not strategy. Politics, not prosperity. Listening without hearing.”

He added: “A messy and disorderly exit would not just be deeply irresponsible – it would be a flagrant dereliction of duty…we in business must make it clear that our elected representatives cannot keep chasing rainbows.”

Last week, on 21 March, the heads of the U.K.’s biggest business lobby and workers’ rights groups—the Confederation of British Industry (CBI) and the Trades Union Congress (TUC)—urged the prime minister to change her Brexit approach, saying the country is “facing a national emergency” and that the “decisions of recent days have caused the risk of no deal to soar.”

They added that “avoiding no deal is paramount,” “securing an extension has become essential,” and that the “current ‘deal or no deal’ must not be the only choice. A Plan B must be found.”

The latest quarterly CBI/PwC financial services survey of 84 firms, published on 25 March, found optimism about the overall business situation in the financial services sector has plunged sharply, falling at the quickest pace since December 2008. The report says optimism has now been flat or falling for over three years—basically, since the period in the run-up to the Brexit referendum.