Brexit Bulletin: Drawing a Line

Charlotte Ryan

02 Jul 2019, 01:55 PM IST

(Bloomberg) -- Today in Brexit: The two candidates for the Tory party leadership are diverging on suspending Parliament and what to do about the Brexit bill.

What’s Happening?

As the contest to become the next U.K. prime minister enters its final days, Jeremy Hunt is drawing a dividing line with Boris Johnson on the prospect of suspending Parliament to push through a no-deal Brexit.

Hunt said he would not go down that road, helping him win the support of William Hague. The former party leader praised Hunt’s “focus and drive” and said he was the better placed of the two candidates to serve as Prime Minister.

“We voted to leave the EU because we wanted to restore parliamentary democracy. You cannot, in that situation, force through a no-deal Brexit by closing down Parliament,” Hunt told Sky News on Monday evening. “The British people would not accept that, including many people who voted for Brexit.”

Johnson, who is still the front-runner in the contest, has so far refused to rule out suspending Parliament if lawmakers oppose a no-deal Brexit. Last week, he said it would be “a folly” to take no deal off the table, a position which could prove more popular with Conservative party members. A poll of party members showed 59% want the new prime minister to be prepared to leave the bloc without a deal if negotiations collapse.

Today’s Must-Reads

No one realized it at the time, but Boris Johnson’s stint in Brussels for the Daily Telegraph may have helped pave the way for Brexit, writes the FT.
Both candidates in the Tory leadership race have pledged extra spending, but, the Guardian asks, do their plans add up?
Johnson could halve the size of cabinet if he’s elected, The Telegraph reports.

Brexit in Brief

New Deal | Jeremy Hunt told Sky News that German chancellor Angela Merkel has vowed to “look at’’ his plan to strike a new Brexit deal if he becomes prime minister. The foreign secretary told presenter Kay Burley he was confident a new withdrawal agreement could be drawn up by September.

No to Amendments | House of Commons Speaker John Bercow has blocked an attempt to stop a no-deal Brexit by cutting off money from the government. He told Parliament he hadn’t selected any amendments to what are known as “estimates” votes – legislation which approves funding to government departments.

No Money Left | U.K. Chancellor Philip Hammond has urged the candidates in the Tory leadership race to “be honest” about their spending plans as the proposals “greatly exceed” the Treasury’s available funds. Hammond, who has made similar pleas before, said the money available would be needed to support the U.K. economy in the case of a no-deal Brexit.

Factory Pain | A downturn in U.K. manufacturing worsened in June, as a gauge for the industry dropped to the lowest level since February 2013. IHS Markit’s Purchasing Managers Index for the sector showed a back-to-back contraction for the first time in more than six years in data Monday.

On the Markets | There is a “significant” chance of no-deal Brexit, said Rabobank’s head of currency strategy Jane Foley in a Bloomberg Television interview. A pickup in inflation expectations could see the Bank of England forced to hike rates in this scenario, she said.

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To contact the editor responsible for this story: Neil Callanan at ncallanan@bloomberg.net, Leila Taha