Facing threat of Brexit delay, May renews efforts for deal change

Prime Minister Theresa May faces a growing threat that she will be forced to delay Brexit to avoid leaving the European Union without an agreement, a no-deal outcome described as “unacceptable” by one of the bloc’s leaders.

With Britain’s Brexit crisis going down to the wire, May is struggling to get the kind of changes from the EU she says she needs to get her divorce deal through a divided parliament and smooth the country’s biggest policy shift in more than 40 years.

In Egypt’s Sharm el-Sheikh for an EU/Arab League summit, she met the bloc’s leaders to try to win support for her efforts to make her deal more attractive to parliament, where frustrated lawmakers are gearing up to try to wrest control of Brexit from the government.

Dutch Prime Minister Mark Rutte told the BBC: “We are sleep walking into a no-deal scenario. It’s unacceptable and your best friends have to warn you. Wake up. This is real. Come to a conclusion and close the deal.”

The deadlock in parliament has also raised the prospect of Britain having to delay Brexit beyond March 29, something May is reluctant to do but which one official indicated could be an option if lawmakers refuse to pass her deal.

The official said ministers were “considering what to do if parliament makes that decision”, when asked about a possible extension.

Tobias Ellwood, a defence minister, also told BBC radio: “If we cannot get this deal across the line, we are facing the prospect of having to extend.”

May has said repeatedly that any delay would simply postpone a decision on how Britain leaves the EU, something she argues parliament needs to address by March 12, when she has promised to bring back a vote on the divorce settlement.

While sterling rallied on the suggestion of a delay, May has to tread carefully, with eurosceptics poised to leap on anything they see as an attempt to thwart Brexit.

“I think it would be disastrous if we had a delay,” said Bernard Jenkin, a Conservative pro-Brexit lawmaker. “I think that faith in our politics – what faith is left in it – would evaporate.”


May’s decision to push back a vote on her deal into March has prompted lawmakers to step up attempts to stop a no-deal Brexit, a scenario many businesses say could damage the world’s fifth largest economy.

Several of their plans would involve extending Article 50, which triggered the two-year Brexit negotiating period, delaying Britain’s departure beyond March 29.

The EU has said it will consider an extension, but only if Britain can offer evidence that a delay would break the deadlock in parliament, which voted down the deal last month in the biggest government defeat in modern British history.

May met German Chancellor Angela Merkel, Rutte and European Commission President Jean-Claude Juncker on Monday.

Juncker described their meeting as “good, constructive” and Irish Prime Minister Leo Varadkar expressed optimism that “on the 29th of March, we’ll either have a deal or an extension”.

A UK government official said: “What you’re getting from European leaders … is a genuine shared determination to get this over the line.”

But the EU has so far rebuffed May’s attempts to reopen the withdrawal agreement.

The European Commission said on Monday it was the EU’s assumption that Britain would leave as planned on March 29.

Commission spokeswoman Mina Andreeva said Britain’s Brexit Secretary Stephen Barclay and Attorney General Geoffrey Cox will hold talks on Tuesday with the EU’s chief negotiator Michel Barnier.

She said “good progress was being made” on the EU-UK political declaration on future ties and on “alternative arrangements” and “possible additional guarantees” on the Irish backstop, an insurance policy to prevent the return of a hard border between the British province of Northern Ireland and EU-member Ireland.

“They agreed on the need to conclude this work in time before the European Council (of March 21),” Andreeva said.

Lawmakers in May’s Conservative Party and those in the main opposition Labour Party are stepping up efforts to try to ensure May cannot take Britain out of the EU without a deal at a vote which is due on Wednesday on the government’s next steps.

Yvette Cooper, a Labour lawmaker, has called on parliament to back her bid to seek to force the government to hand power to parliament if no deal has been approved by March 13 and to offer lawmakers the option of requesting an extension.

But there is another, perhaps more attractive, proposal to the government, from two Conservatives, which would delay Brexit to May 23, the start of the European Parliament elections, if lawmakers have not approved a deal by March 12.

A government official said the proposal could be considered “helpful”.


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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell