Brexit Bulletin: The Plotters Are Back

(Bloomberg) -- Today in Brexit: Conservative rebels trying to block no-deal are having another go.

What’s Happening?

Can members of Parliament stop a prime minister pulling the U.K. out of the European Union without a deal? That’s probably the single most important question now facing businesses and citizens as Tory party members pick the country’s new leader.

Dominic Grieve, a veteran anti-Brexit rebel and former attorney general, is preparing to have another go this week after his last attempt failed. There’s a bill on Northern Ireland heading to the House of Commons on Monday – Grieve plans to amend it so that Parliament will have to be sitting in October and, therefore, can’t be suspended by a prime minister trying to push no-deal through without MPs’ consent. 

Front-runner Boris Johnson has said he doesn’t want to suspend Parliament but he’s left the option on the table. He says the U.K. must wield the credible threat of walking away without a deal in order to persuade the EU to rewrite the unpopular divorce agreement.

There are more than 30 Conservative MPs who want to block a chaotic exit, according to former minister Sam Gyimah. They count some heavyweights among them: Prime Minister Theresa May has hinted she could join the rebels to prevent the economic and political chaos of a messy divorce, as has Chancellor of the Exchequer Philip Hammond. The Labour Party is also trying to stop it.

Justice Minister David Gauke, who suggested at the weekend he would quit before Boris Johnson could fire him, is also preparing for life as rebellious backbencher. And he reckons they will win – he told the BBC they have a “speaker who is perhaps prepared to be innovative,” on their side, a “clear majority in Parliament that is against no deal,” and the fact the 2016 referendum “wasn’t sold on the basis of a no-deal Brexit.” 

“So with all those facts I think parliament will find a way through.”

Today’s Must-Reads

• There’s no clear evidence that Boris Johnson is better at winning votes than Jeremy Hunt,  The Times says.
• Facing economic disaster, Irish business stands firm on Brexit, writes Dara Doyle.
• U.K. to probe leak of envoy’s memos calling Trump ‘inept’.

Brexit in Brief

Get On With It | Shadow Chancellor John McDonnell said the party should hurry up and define its Brexit policy in favor of remaining in the EU. “We haven’t been able to get the deal we wanted so I would vote remain, I would want to campaign for remain,” he told the BBC. “We need to decide early and get on with it.” He wants a clear policy in place before the next general election.

Not Bluffing | Johnson insisted in an interview with the Sunday Telegraph that he’s not bluffing when he says he’s ready to walk away without a deal. “No ... Honestly. Come on. We’ve got to show a bit more gumption about this,” he was quoted as saying. “They have to look deep into our eyes and think, ‘my God, these Brits actually are going to leave. And they're going to leave on those terms.’”

Revoke or No-Deal | A poll for the Independent suggested the public would prefer to cancel Brexit altogether rather than opt for a chaotic exit. The paper said 43% of those surveyed would prefer to revoke the decision, compared with 38% who backed no-deal. It also showed that 41% supported the idea of another referendum to break the impasse.

Javid Backs Johnson | Home Secretary Sajid Javid came out for Johnson, saying he was “better placed” than Hunt “to deliver what we need to do at this critical time.” The Times reported that he’s positioning himself to be Johnson’s chancellor and the pair discussed the post on Wednesday. Javid will make a speech this week about preparing for no-deal, including an emergency budget, the paper said.  

BOE in a Bind | Traders are increasingly pricing in a U.K. interest-rate cut as the prospect of a disorderly departure from the European Union increases. The problem for the Bank of England is that those market expectations are plugged into its projections, but the bank can’t assume a no-deal Brexit scenario because that’s not the government’s stated policy (yet.)

Johnson Ahead | As Tory grassroots members started voting in the leadership postal ballot, Johnson cemented his lead over Hunt. A YouGov poll published in the Times indicated Johnson is backed by 74% of Conservative Party members with Hunt on just 26%.

Life Goes On | Veolia Environnement SA Chief Executive Officer Antoine Frerot said the French water and waste-treatment utility expects growth in the U.K. no matter how the country leaves the EU. “We will continue to invest,” Frerot said Friday in an interview with Bloomberg Television. "We don’t see a decline in waste volumes produced by British companies and families so we don’t see a decline in the country.”

Of Brexit and Actual Divorces | U.K. divorces may not be recognized in Ireland after Brexit unless a new law is passed, according to the Irish Times. The country’s Bar Council has warned the Department of Justice that marriages could end up recognized in one jurisdiction, but not another.

On the Markets | The pound was little changed this morning at $1.2529.

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

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