The rusting of the iron lady

Twelve months ago to the day, Theresa May stood up in Lancaster House in London and outlined the nature of the future relationship she was seeking with the EU. As I wrote at the time “anyone looking for any great insight as to how the UK will be able to achieve the objectives she set out will have been disappointed. Mrs May in effect gave a wish list of what she wants for the UK, but the nature of the deal itself will depend on the compromise which can be achieved with the EU. And on that front, we will have to await the EU’s opening play to assess how realistic her goals are.“ 

One failed election campaign later, which has severely weakened the prime minister’s political clout, the UK remains deadlocked in negotiations with an EU27 which has maintained an impressively coherent stance, despite attempts by the UK to sow division. The UK has also fallen into line with EU27 demands on its three main negotiation points (the rights of EU citizens, the Irish border question and the Brexit bill). Twelve months ago, the UK government was also awaiting the Supreme Court ruling on whether parliament would be allowed a vote on the triggering of Article 50. In the event, it was – despite the government’s initial position that this was not necessary. The EU Withdrawal Bill, which is now in the process of going through parliament, has also been watered down with parliament to be given a vote on the final terms of the EU deal in yet another concession to MPs.

Indeed, looking back over the past year it is clear that the government has been forced to give way on a number of areas. Theresa May initially believed that the government could simply transcribe all EU law onto the UK statue book, and strike out those parts of the legislation it did not like, before agreeing an exit deal with the EU without any parliamentary oversight. She also told us in September 2016 that she would not give a “running commentary” on Brexit negotiations. But thanks to a rearguard action by many MPs, parliament now has a chance to scrutinise the Brexit deal whilst the House of Commons Library has published on the state of negotiations after each round of Brexit talks. This, of course, is precisely what should happen. After all, one of the key Brexit selling points was that the UK parliament should oversee UK laws (though strangely enough, the likes of the Daily Mail always kicked up huge objections any time the government’s authoritarian Brexit approach was challenged). 

With numerous pro-Leave campaigners expressing regrets about how issues have been handled since the referendum, most notably the surprise suggestion by Nigel Farage that he would not necessarily be opposed to a second plebiscite, it does make you wonder how events will unfold over the next twelve months. As I noted last week, a second referendum is unlikely anytime soon. However, it is likely that a compromise agreement will be reached which postpones the final exit decision until end-2020, thus giving industry – including the so-far neglected financial services sector – more time to prepare for an uncertain future. 

The government itself is in a precarious position, and survives in office only with the support of a confidence and supply agreement with the Democratic Unionists. In more normal times, it is hard to imagine Theresa May holding onto her position since she has proved, as The Economist wrote last week, to be anything but a safe pair of hands whilst “her biggest problem is more fundamental: she doesn’t have any ideas.” But she maintains the support of the Conservative party because she is the least divisive candidate in a party which is split down the middle on Brexit and which is paranoid that a change of leader would open the door to the opposition Labour party. The gossip regarding May’s survival chances continues to swirl and I have no idea whether she will still be in office in a year’s time. But over the next twelve months, we can look forward to the crossing of more red lines as the process of aligning the “will of the people” with the needs of the economy continues.