Breakthrough in U.K. Party Talks Unlikely Today: Brexit Update

(Bloomberg) --

The government and opposition Labour Party are set for a crunch meeting on Tuesday that could define the course of Brexit. If the two sides fail to agree a compromise, the chances of another referendum or even an emergency general election will rise.

Key Developments:

  • Cabinet minister David Lidington says EU elections will go ahead
  • Government talks with Labour to resume at 4 p.m.
  • If negotiations fail, the next step would be a series of votes in Parliament seeking a consensus for an alternative
  • Tory activists to meet June 15 to debate petition to replace May

Breakthrough in Cross-Party Talks Unlikely Today (4:40 p.m.)

The continuation of cross-party Brexit negotiations will be decided on a meeting-by-meeting basis, according to a person familiar with the talks. If the talks between Theresa May’s government and the opposition Labour Party go on into next week, it will be a sign there is a realistic chance of success, the person said.

There is unlikely to be a positive breakthrough in talks today after both parties were buffeted by the backwash from bad election results last week, the person said.

Breakthrough in U.K. Party Talks Unlikely Today: Brexit Update

May to Step Down After Brexit, Slack Reiterates (4:10 p.m.)

May is under pressure from Tory activists and backbench MPs (see 7:20 a.m.) to name a resignation date. But her spokesman, James Slack, said only that the prime minister planned to step down after Brexit was delivered -- restating her previous position. May is determined to get Brexit over the line, he said.

Slack also confirmed Lidington’s statement (see 3:20 p.m.) that European elections will definitely go ahead.

“The PM deeply regrets we haven’t left the European Union on time, the consequence of that is we will have to take part in European elections,” he said. “She understands many members of the public will feel great frustration with this.”

Lidington Says EU Elections Will Go Ahead (3:20 p.m.)

David Lidington, May’s de facto deputy, said government efforts to find a way forward on Brexit will not be concluded in time to avoid taking part in the European Parliament elections this month. The aim is now to conclude Brexit before elected MEPs take their seats on July 2, he said. And he “certainly” wants the issue resolved by the time Britain’s Parliament breaks up for the summer recess, which is usually mid-July.

Breakthrough in U.K. Party Talks Unlikely Today: Brexit Update

“We very much hoped that we would be able to get our exit sorted and have the treaty concluded so that those elections did not have to take place,” Lidington told the BBC. “But legally, they do have to take place -- unless our withdrawal has been given legal effect -- so those will now go ahead.”

Two Peers Quit May’s Government (2 p.m.)

May’s office has announced the resignation of Trade Minister Rona Fairhead, a member of the House of Lords, due to personal reasons. A second member of the upper chamber, Zahida Manzoor quit as a government whip, also for personal reasons.

While there’s no hint of discontent, the resignations are symptomatic of the churn in Theresa May’s administration. More than 30 ministers have quit or been fired since the general election almost two years ago.

Brexit Talks to Resume at 4 p.m. (12:30 p.m.)

Government talks with the opposition Labour Party are set to resume at 4 p.m., Theresa May’s spokesman, James Slack, told reporters in London. The aim is to secure a Brexit solution that will garner a “stable” majority in Parliament, he said, a comment that indicates the government is looking for Labour to support the Withdrawal Agreement Bill at every stage of its passage through the House of Commons.

Slack also said it’s becoming more likely each day that passes that the U.K. will have to take part in European Parliament elections. He said Cabinet discussed Brexit for an hour on Tuesday morning, and May reiterated that the results of last week’s local elections showed the public wants both major parties to get on with delivering the U.K.’s departure from the EU.

Tories Plan June 15 Debate on Replacing May (9:15 a.m.)

Conservative activists have been invited to an emergency meeting in London June 15 to debate whether the party should choose another leader. Andrew Sharpe, chairman of the Conservative National Convention, set the date in a letter to members, which also set out the petition he received from 65 local Conservative association chairmen calling for Theresa May to resign.

A debate and vote on May’s leadership will be the only item on the agenda at the meeting, according to Sharpe’s letter, which was posted on the ConservativeHome website. While it’s not legally binding, it would -- if passed -- add to pressure on the prime minister to name her resignation date.

Hunt Hints at Customs Union Compromise (7:30 a.m.)

Foreign Secretary Jeremy Hunt said he doesn’t “personally” favor a customs union with the European Union as a “long-term” outcome, but compromise will be needed on all sides.

Hunt told BBC Radio 4 his view is that the U.K. economy is too big for a customs union to work long-term. The key word here may be long-term: one of the proposals in talks is for a temporary customs union.

Why is May Meeting Brady? (7:20 a.m.)

Education Secretary Damian Hinds downplayed May’s scheduled meeting on Tuesday with Graham Brady, chairman of the so-called 1922 Committee of rank-and-file Conservative members of Parliament. According to media reports, Brady is planning to tell May to set a date for her departure.

“The prime minister has already been clear and straightforward about what she will do; that she will see through this first phase of Brexit,” Hinds told the BBC. “I don’t think you should read too much into the fact the prime minister is meeting the chairman of the 1922 Committee; that’s what happens as a matter of course.”

Breakthrough in U.K. Party Talks Unlikely Today: Brexit Update


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