Brexit Bulletin: Extension Rebellion

Brexit is 8 days away (in theory).

(Bloomberg) --

Today in Brexit: Parliament forced Boris Johnson to pause his Brexit plans, but signaled it could support his deal in the end. A delay, or even a general election, could lie ahead.

What’s happening? Fans of an Oct. 31 Brexit will probably be disappointed now that the U.K. Parliament has voted against the prime minister’s plans for rapid-fire passage of key implementing legislation. Johnson appears ready to seek a general election, but will wait for the European Union to decide on the length of any delay.

But events are now out of his hands. The government doesn’t control the levers for calling an election. That can only be secured with consent from opposition parties, a route fraught with risk. And it doesn’t control the EU response to last night’s vote. While (outgoing) EU Council President Donald Tusk said he will recommend that leaders accept a three-month delay, a French statement all but excluded that idea. Johnson’s next move will depend on what the EU decides.

Nevertheless, history was made on Tuesday. For the first time since the 2016 referendum, the House of Commons voted in favor of a specific plan for Brexit, approving a second reading of Johnson’s divorce legislation. Seventeen minutes later, MPs pulled the handbrake, voting down the government’s three-day timetable for debating the law. You can see how all the MPs voted last night in this graphic.

Brexit Bulletin: Extension Rebellion

With that vote, Johnson’s hands were tied. He immediately announced he would “pause” passage of the law. Debate will resume today on the rest of the government’s domestic agenda, with Brexit out of sight, out of mind. Speaker John Bercow said the Brexit bill is now “in limbo.

Today’s Must-Reads

Brexit in Brief

Task Force Barnier | Michel Barnier is with us for the long-haul. The EU’s current chief Brexit negotiator will head a new task force for relations with the U.K., the European Commission said. Barnier’s group “will coordinate all the Commission’s work on all strategic, operational, legal and financial issues related to Brexit,” the commission said in a statement. 

On the Markets | The pound weakened against all its major peers as Parliament made its voice heard. Sterling slid as much as 0.8% against the dollar before recovering from its intra-day low. Recent events have seen the pound settle at around $1.29, with the diminishing risk of a no-deal Brexit limiting losses from Tuesday’s votes. It traded at $1.2875 early this morning.

Brexit Bulletin: Extension Rebellion

Loyalist Fury | Northern Irish loyalists vowed to resist what they see as the economic reunification of Ireland implicit in Johnson’s Brexit deal, warning of civil disobedience on the streets of Belfast that could tipping over into violence. “You are going to have an organic explosion of anger” if Johnson’s deal is passed, said Jamie Bryson, a de facto spokesman for loyalists.

Spend Not Tax | U.K. Chancellor of the Exchequer Sajid Javid won’t unveil big giveaways in next month’s budget, the Financial Times reports, focusing instead on public spending to kick-start infrastructure projects. Moves to implement Johnson’s £8 billion ($10.3 billion) promise to cut the tax bills of high earners will be put on hold, the newspaper says.

Big Questions | Amid all the oodles of words written on Brexit each day, Telegraph sketchwriter Michael Deacon nicely articulates the madness of the process. Reporting on last night’s action in the Commons, he calls proceedings “action-packed, and yet at the same time so uneventful,” and wonders: “How can something so dramatic be so boring?”  

Want to keep up with Brexit?

You can follow us @Brexit on Twitter, and listen to Bloomberg Westminster every weekday.

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