In any ‘normal’ week at Westminster the chancellor’s spring statement would be main stage, last night and again today, the Commons hurtled into unknown political territory with a series of Brexit related votes, firstly last night’s second heavy defeat of the government’s withdrawal plan and then parliament’s turn this evening and tomorrow to narrow down a course for Brexit, now just two weeks away.
First, and not unexpectedly, today’s spring statement was a scaled back affair. With no Brexit arrangement agreed, chancellor of the exchequer, Philip Hammond was straitjacketed. Instead he was forced to push back big decisions to the spending review, to be launched before the summer recess and report back at the November budget. Today’s statement largely focused on infrastructure spending to boost the economy. Though the chancellor admitted that he has only limited room for manoeuvre given the need to control inflation and that the economy is near its productive capacity.
There were a few big announcements – on the environment, the NHS, free sanitary products in schools, and £100m for police overtime to tackle knife crime – but these were either politically necessary or to provide a good news story for the media. Normally chancellors use this statement to create a broader narrative, to paint a picture of a stable and visionary government – but this statement had none of that. The chancellor has warned a no-deal Brexit would mean ‘significant disruption’ with higher unemployment, lower wages and higher prices. The treasury has also built in £26.6bn headroom into forecast against fiscal targets – that’s significantly up from £15.4bn in the Autumn budget. This afternoon’s statement did what it needed to do and little more. This makes the November budget, or an emergency one before it, even more important.
The prime minister had been due to open this afternoon’s no-deal Brexit debate but No10 has confirmed that, owing to the PM’s ailing voice, Michael Gove will take her place. The PM, with fast fading voice said at PMQs earlier that she would vote for the motion in her name and grant MPs a free vote on taking no deal off the table. It is unlikely the Commons will vote for no-deal but if it does, the default position to leave on 29 March remains and we can expect the government to ramp up no deal planning. The PM or one of her ministers will update the House on next steps after the result at around 1930 tonight.
Another seismic day lies ahead tomorrow when MPs vote on an extension to Article 50, to delay Brexit past 29 March. If this happens, the prime minister will have to ask the EU for permission to extend – and all 27 other EU countries will have to unanimously agree – but on what terms? For how long? How much will the UK’s financial contributions be? Will a second referendum be part of the conditions?
The EU’s chief negotiator, Michel Barnier, told senior MEPs this morning that there is no clear majority yet among the member states for any extension at all. He also said the current impasse ‘can only be solved in the UK.’ It’s not yet clear what practical purpose an extension of Article 50 would serve if negotiations are not being re-opened.
POLITICO polling has consistently shown that Britain is divided roughly into thirds when picking between the main Brexit outcomes: a deal; no-deal; or no Brexit – and today’s polling shows the country remains at odds – 35 percent support further negotiations with the EU in some form (whether on the current deal, a softer form of Brexit, or with a new PM at the helm); 29 percent support a second referendum; and 25 percent support a no-deal outcome.
We are very much in unprecedented territory – with all options from no deal, prime minister’s deal, a snap general election to a second referendum all still firmly on the table.
Scott Dodsworth is Head of Public Affairs at Hill+Knowlton Strategies.
Scott is available for press inquiries and comment. Please contact him on +44 20 7413 3807 or Scott.Dodsworth@hkstrategies.com