Brexit Bulletin: More Talks as Business Walks

(Bloomberg) -- Today in Brexit: As Nissan scraps its U.K. investment plan, ministers recycle old ideas to try to make Brexit work.

There are 53 days to go until Brexit day, investment is fleeing the U.K., and Prime Minister Theresa May has a new idea: Set up a “working group” to find a silver-bullet solution that has escaped negotiators for the past two years.

The backdrop to the talk-shop is Nissan’s decision to pull a plan to build a new SUV in Sunderland—the city that voted overwhelmingly for Brexit even though it had the most to lose. Nissan was offered secret pledges by the government after the referendum; the decision suggests it thinks those pledges are no longer good enough.

But the carmaker’s decision doesn’t seem to have injected much urgency into the business of finding a Brexit deal that can get through Parliament. There’s still no date for May to return to Brussels to renegotiate the most toxic part of her deal –  the so-called Irish backstop. That’s probably because there isn’t a clear plan yet for what to seek. 

Chief Secretary to the Treasury Liz Truss had more bad news for businesses trying to plan or citizens wondering whether to stockpile beans: “It’s inevitable that in these types of negotiations things do get decided close to the last minute.”

So on Monday May will launch a new government working group that aims to unite the pro- and anti-Brexit factions of her bitterly divided party. Home Secretary Sajid Javid set out the plan on the BBC on Sunday. Brexit Secretary Steve Barclay has been tasked with inventing the impossible—finding an “an alternative arrangement” to the Irish backstop. That usually means high-tech solutions that would make a hard border unnecessary.

In case that fails, Attorney General Geoffrey Cox is looking at whether there can be “a hard time limit” or an exit mechanism. It’s worth remembering that all three of these proposals have already been rejected by the EU.

So far there’s no sign of Brussels budging. Sabine Weyand, the EU’s deputy chief negotiator, indulged in a spot of trolling on Twitter yesterday, making it clear the bloc still thinks “alternative arrangements” are nothing much more than magical thinking.

Today’s Must-Reads

  • Even a minor legal change to May’s deal will give her a chance to put together a coalition to get it through Parliament, argues James Forsyth in the Spectator. “She isn’t certain to be successful—but she has a chance.”
  • legal pile-up could delay Brexit: Here’s the list of legislation that still needs to be dealt with.

Brexit in Brief

When Are We Actually Leaving? | The taboo is officially broken. Chancellor of the Exchequer Philip Hammond on Friday raised the prospect of a delay to Brexit, following up on comments from Foreign Secretary Jeremy Hunt. Trade Secretary Liam Fox also dropped  a hint on Sunday. So far, the idea is that a deal would be reached and then an extension granted just to tidy up the legislative paperwork. But the narrative could change. ITV’s Robert Peston reckons there will be a walkout of ministers before the next big vote in Parliament on Feb. 14 if May hasn’t made clear she’ll seek a delay by then.

Election Speculation | The Mail on Sunday reports that May’s aides have considered the possibility of  a June election, while the Sunday Times says Cabinet Secretary Mark Sedwill is trying to push May to hold one. Polls show the Tories ahead—but not as far ahead as they were last time May called a June ballot. Home Secretary Sajid Javid knocked down the idea (which doesn’t mean it won’t happen.) 

Look Who Else is Moving | Global affairs and lifestyle magazine Monocle is moving printing to Germany to avoid disruption from a potential no-deal Brexit. It produces 155,000 copies of its monthly publication in Cornwall, and exports about 80 percent of them. “There just isn’t much of a plan in this country,” editor-in-chief and chairman Tyler Brule said in a phone interview. 

Left on Standby | British Airways is refusing to offer pilots and other staff a new three-year salary package, offering a one-year deal instead as Brexit adds to the uncertain outlook for the industry.

On the Markets | The Bank of England will keep interest rates unchanged at 0.75 percent this week, according to a Bloomberg survey, while lowering its growth and inflation forecasts for 2019. Brexit will dominate Governor Mark Carney’s press conference after Thursday’s rate decision. The pound was unchanged in early trade on Monday at $1.3076.

Brexit Bulletin: More Talks as Business Walks

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