Whose Default Is It Anyway?
Uncompromising remarks from Johnson’s administration, demanding that the EU make the first steps to a Withdrawal Deal compromise, are worrying markets that a no-deal Brexit is becoming increasingly likely. However, as the media is now realizing, the rising risk of a no-deal Brexit may have just as much to do with Parliament’s possible impotency to stop the scheduled Article 50 deadline on October 31―even assuming that the government is not able to prorogue Parliament.
Faced with a long summer recess that lasts to September 3, it is now unlikely that Parliament can trigger a general election before the Brexit deadline date, at least one that could avert the default position of the UK leaving the EU on October 31. Instead, if Parliament is to prevent a no-deal Brexit, it seemingly now has two options, both probably based around a confidence vote. We now expect to see a parliamentary vote of confidence on the Johnson government very soon after Parliament sits again.
We see only a 20% chance that the government would survive such a vote given the unfriendly parliamentary arithmetic and the fact that anti-Brexit Members of Parliament (MPs) will consider such a vote as a ballot on Brexit itself. If the government were to survive this vote, it is hard then see what would prevent a no-deal Brexit, save for the small possibility that the EU may then belatedly bend and allow some re-working of the existing Withdrawal Deal, probably involving some dilution of the Irish backstop.
Figure 2: Key Dates Ahead
|August 25-27: G7 Summit||G7 summit in Biarritz, France|
|September 3: Parliament returns for scheduled new session||Scheduled date for the House of Commons to return from summer recess and first date that a confidence vote can be requested, but only for the following day.|
|September 22 - October 2: Party conferences||The Labour and the Conservative Party conferences are held in consecutive weeks, with Parliament in temporary recess.|
|October 8: Parliament returns from conference Lull||The date MPs would return to Parliament after the conference break recess, 18 working days before the UK would be due to leave the EU.|
|October 17-18: Scheduled EU Summit||Potentially the final scheduled meeting for EU leaders ahead of the then-looming Article 50 deadline on October 31.|
|October 25: Possible general election||Earliest date for a general election if no-confidence vote is passed right after summer recess ends.|
|October 31: Current Article 50 deadline||Also the date when the new EU Commission President Ursula von der Leyen takes over. She could reassess the Brexit timetable/approach partly set by her predecessor Jean-Claude Juncker (who appointed Michel Barnier as European Chief Brexit Negotiator).|
Source: Continuum Economics
Johnson Loses Parliament’s Confidence
The more likely scenario is that the government loses such a confidence vote. In such an instance, the Fixed Term Parliament Act would set unprecedented events in motion: There would then be 14 days in which either the existing government regains the confidence of Parliament, or an alternative government wins in its place. If neither occurs, then an election would have to occur some 25-27 days later, i.e. no earlier than October 25. Johnson’s government probably would not regain the confidence of Parliament, as it would almost certainly have to agree to defer Brexit once again, which would destroy Johnson’s credibility and electoral value to the Conservative Party.
Uncharted Constitutional Waters
Johnson may refuse to resign, or he could suggest an election date to the Queen after October 31, meaning Brexit would go ahead. The problem here is that the Queen may ignore such advice, especially if she were made to believe that Parliament felt differently. Such resistance from Johnson could therefore raise marked and unprecedented constitutional issues, if not crises, that may undermine his main support if the monarch was drawn into the political fray. Indeed, it is possible that the Queen may decide that, under such circumstances, Johnson no longer has authority, especially if she believes that Parliament would support an alternative stopgap administration headed by a neutral figure as prime minister whose sole aim would be to extend the Brexit deadline until after a new general election. However, such a “government of national unity” would be difficult to build given existing divides and animosities in Parliament.
Alternatively, Parliament itself may try to concoct some form of procedure that would formally force a further Brexit extension: House Speaker John Bercow has already suggested that a no-deal Brexit would be impossible without the will of Parliament. Exactly how this would be achieved is unclear, as it is the government that normally controls the agenda of the House of Commons, but one possible method is “Standing Order 24,” which could be used to grant Parliament control of the government’s agenda. However, for the Speaker to use this recourse, Parliament would need to delve into previously uncharted constitutional waters.
At the same time, if the government loses a confidence vote and Johnson shows resistance to the spirit of the Fixed Term Parliament Act, the Speaker may very well believe he has both the rationale and authority to take such unprecedented action. We think this is the more likely means through which the current Brexit deadline could be extended.
What is clear is that the coming weeks, even before Parliament formally sits again, will be rife with debate about what the House of Commons can and cannot do to prevent a no-deal Brexit. Legal minds are already offering conflicting views. What does seem to be the case is that the possibility of a no-deal Brexit on October 31 has increased to as high as 50%. Moreover, the likely alternative, which would almost certainly involve a general election, may merely result in an outcome that still leaves a hard Brexit in the cards, albeit at a later date. Current opinion polls are consistent with a hung Parliament, but UK polling has become volatile this year from the surge of the Brexit Party and Liberal Democrats, as well as the recent rebound in support for the Conservative Party under Johnson.