Theresa May, U.K. prime minister, departs number 10 Downing Street in London, U.K. (Photographer: Simon Dawson/Bloomberg)

May Loses Control Over Brexit Endgame in War With Parliament

(Bloomberg) -- U.K. Prime Minister Theresa May is locked in a power struggle with the British Parliament that looks set to determine the final shape of Brexit.

May lost three key votes on a day of drama in the House of Commons on Tuesday, highlighting the weakness of her position as she tries to ratify the deal she’s struck with the European Union.

May Loses Control Over Brexit Endgame in War With Parliament

The result is that Parliament now has the potential to decide on Britain’s “plan B” if -- as expected -- it rejects May’s divorce agreement with the EU in the biggest vote of all next week.

That’s not what the premier wanted. It raises the possibility that members of Parliament could seek to pursue a softer withdrawal -- including potentially staying in the bloc’s single market -- or even attempt to stop Brexit entirely. One option that could gather momentum over the weeks ahead is for a second referendum to allow the public to overturn the decision of the first.

“No longer must the will of Parliament -- reflecting the will of the people -- be diminished,” Tory lawmaker Dominic Grieve said after engineering one of May’s defeats Tuesday. “Parliament must now take back control and then give the final decision back to the public because, in the end, only the people can sort this out.”

But according to Leader of the House of Commons Andrea Leadsom, the crucial vote didn’t rule out a no-deal Brexit.

“It basically says Parliament, where we know there is no majority for one outcome or another, will have more say over this,” she told BBC Radio on Wednesday.

May Loses Control Over Brexit Endgame in War With Parliament

Long Odds

On Dec. 11, Parliament will vote finally on whether to accept or reject the 585-page withdrawal agreement that May and the EU reached in November. Few officials in May’s government believe they have much chance of winning, with some Tories predicting a heavy defeat.

If they’re right, the U.K. will be on course to crash out of the EU with no deal, an outcome which the Bank of England and the Treasury warned last week would cause immediate and severe damage to the British economy. According to the BOE analysis, house prices could be hit by 30 percent and the pound could fall by as much as 25 percent after a no-deal Brexit.

While the EU is clear it won’t renegotiate the divorce terms, the bloc has always said it will consider a much softer Brexit if the U.K. drops it’s red lines.

The European Commission says Britain can keep full single market membership if it agrees to keep the bloc’s free migration rules and abide by the rule of the EU’s top court. May has ruled out both of these conditions -- but others in Parliament take a different view.

The signs are not good for May’s plan. Labour leader Jeremy Corbyn said the official opposition, which he leads, will oppose her deal next week. Critics from all sides of the House lined up to raise objections to the deal.

May Loses Control Over Brexit Endgame in War With Parliament

One of those was former Conservative Chief Whip Mark Harper, who said he would end 13 years of loyalty to the government and vote against the deal. He urged May to go back to Brussels before the vote next week and try to change the text on the Northern Irish backstop in order to appease Brexiteers.

“If the Prime Minister listened to the views of Conservative colleagues, she would know that her deal isn’t going to be voted through next week and it needs to be changed,” he told BBC Radio on Wednesday.

May Loses Control Over Brexit Endgame in War With Parliament

Key Votes Lost

Even Northern Ireland’s Democratic Unionist Party, which has a formal role propping up May’s minority Tory government, isn’t backing her.

On a day of fast moving developments on Brexit:

  • An advisory opinion from the EU’s top court indicated that the U.K. can unilaterally decide to reverse Brexit
  • May lost two House of Commons votes forcing her to publish secret government legal advice on her Brexit deal. After being found in contempt of Parliament -- an unprecedented charge against a government -- May promised she would release the legal file Wednesday. It will be released at about 11:30 a.m., Leadsom said
  • The premier then lost a third big vote that could prove even more significant: it gives Parliament the power to shape the final Brexit settlement if, as expected, May fails to get her deal approved in the Dec. 11 vote. The pound pared earlier losses.

Speaking shortly after the defeats, May put on a brave face, and appealed to her colleagues to back her “compromise” plan or risk betraying voters who chose to leave the EU in the referendum of 2016.

Central Figure

“I do not say that this deal is perfect -- it was never going to be,” May told the Commons. “We should not let the search for the perfect Brexit prevent a good Brexit that delivers for the British people.”

The government’s frustration focused on the central figure of Commons Speaker John Bercow. He made the ruling to allow Tuesday’s damaging votes to take place.

May Loses Control Over Brexit Endgame in War With Parliament

According to people familiar with the matter, May’s cabinet ministers expressed their private anger at Bercow’s handling of Brexit during a meeting earlier Tuesday, with some of those present voicing harsh words about the Speaker. Bercow’s office didn’t immediately respond to a request for comment.

Thanks to May’s defeats Tuesday, it would be the Speaker again who would decide how Parliament can shape the plan B if the premier fails to get her overall Brexit deal through the Commons next week.

©2018 Bloomberg L.P.