Brexit Bulletin: Not a Dictator

(Bloomberg) -- Today in Brexit: As Boris Johnson consolidates his position as front-runner, the question of how a no-deal exit could work becomes more pressing. 

What’s Happening?

With Boris Johnson so far ahead in the leadership race that even his rivals are positioning themselves to work for him, the question Tories need to answer is how he can keep his promise to take the U.K. out of the bloc on Oct. 31.

While he says he is not aiming for a unilateral exit, he’s keeping it as an option to strengthen the country’s negotiating position. The trouble is that some of his party’s members of Parliament are working out how to stop a future prime minister leading the country out without a deal, and suspending Parliament – the only clear way of doing it – is so controversial that it would split the party. Johnson's appeal is that he's meant to unite the party.

In the leadership debate last night, the punchiest part of the discussion was about the rights and wrongs of sidelining Parliament. Home Secretary Sajid Javid (who wants to keep no-deal on the table but doesn’t articulate how he would deliver it,) led the attacks on rival Dominic Raab over his suggestion that he could suspend parliament.

"We are not selecting a dictator of our country, we are selecting a prime minister," Javid said.

Johnson didn’t show up at the debate last night. He hasn’t made clear where he stands on proroguing Parliament, saying last week he was “strongly not attracted” to the idea.

But with Parliament opposed to no-deal, it’s hard to see another way of doing it. If he did sideline lawmakers, he’d have to contend with pro-European Conservatives who are threatening to bring down the next prime minister if he went for it.

“There are number of colleagues who have gone public saying they would consider doing that, and there are a number I know of privately who say that,” Work and Pensions Secretary Amber Rudd said in a BBC interview. “Any candidate needs to factor that in as well into their strategy for the next few months.”

How committed is Johnson really to no-deal? There was a hint on Friday that his Oct. 31 pledge might not be as solid as it sounds.

He told the BBC: “We have got to be out by Oct. 31. It would be absolutely bizarre to signal at this stage that the U.K. government was willing once again to run up the white flag and delay yet again.” Could that change?

Today’s Must-Reads

• Boris Johnson’s critics say he lies, but Tories want to trust him. The biggest threat to his campaign now could be that one faction decides it’s being played, write Rob Hutton and Tim Ross.
• Theresa May will be remembered as the prime minister who couldn’t deliver Brexit. But she also failed to confront the U.K.’s “burning injustices,” writes Bloomberg Opinion.
• ICYMI: The EU’s secret plan for a catastrophic Grexit.

Brexit in Brief

Another Backer | Health Secretary Matt Hancock, a centrist modernizer who pulled out of the leadership race last week, is now backing Boris Johnson. Esther McVey, a hardline Brexit backer who made her failed leadership campaign about “blue-collar conservatism,” did too. Candidates Jeremy Hunt, Michael Gove and Dominic Raab all said they would serve in a Johnson government.

Talks with Farage | Conservative Party donors have started talks with Nigel Farage about a possible electoral pact as polls show his Brexit Party would finish ahead of the Tories in a general election, the Telegraph reports. The Conservatives would not stand against the Brexit Party in dozens of seats in any snap election, the paper says.

Macho Brexit | Rory Stewart was hailed by the Twittersphere as the star of the debate on Sunday night. His pitched himself as a listener, a “frail” human with a lot to learn, and a thinker who’s not afraid to change his mind. He accused his rivals of engaging in a competition of “machismo” with their claims to be able to succeed in Brussels where Theresa May failed. “It’s nonsense.”

Airbus Warns Again | Airbus SE, one of the most outspoken companies on Brexit, is telling European countries to prepare for a worst-case scenario so they aren’t caught flat-footed when the next deadline of Oct. 31 approaches. “We are encouraging the governments to work with each other, which they have started to do, which they have done – some of them – to prepare for a no-deal scenario,” Chief Executive Officer Guillaume Faury said Friday. The bloc says it’s already prepared for no-deal. 

Labour Fights | Several senior figures in the Labour Party will call for a clear and full commitment to a second referendum on Monday, the Guardian reports. 

London Falling | House prices in London continued to drop this month, though the downturn is showing some signs of leveling off, according to Rightmove. 

On the Markets | The pound could get some respite this week if the Bank of England sounds more hawkish. But the longer-term prospects are still grim. Sterling was unchanged in early trade on Monday.

Coming Up | Leadership candidates will take part in hustings with Westminster reporters this morning. The second round of voting is on Tuesday, followed by debate on BBC.

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

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