What happens next: plot your own Brexit

The Brexit saga is starting to resemble one of those 1980s stories where the reader could control the plot. You know the sort of thing “If Ted picks up the ring, go to page 47”. The House of Commons library has published a Brexit roadmap at https://commonslibrary.parliament.uk/parliament-and-elections/parliament/brexit-and-the-meaningful-vote-the-final-countdown/ which sets out the legislative timetable.

But that misses out the politics, and that is where the excitement (and the chaos) will lie. Let us start by assuming that Theresa May loses the vote on December 11 by a substantial margin. The next step could be a vote on confidence in the government, called by the opposition. If you think the government wins, go to 1 below. Otherwise go to 2.

  1. May carries on and asks the Commons to vote again in January. Will the vote pass a second time? It may depend on the market reaction. If the pound and equities plunge at the prospect of “no deal”, then MPs may take fright. But every broker’s note I have seen is assuming that May is defeated first time round. So the market reaction will be muted. Another possibility is that Labour abstains second time round to avoid a no deal. But chaos suits Corbyn as it will make the Tories less popular, and he has never liked the EU anyway. If you think the vote passes second time round, go to 3. If not, go to 4.
  2. A confidence vote defeat ought to mean a new election, unless Labour can cobble together a government with the help of minority parties within 14 days. Either way, go to 5.
  3. Success for May in a second round vote would cause great relief in the markets. But it would leave angry Brexiteers in her party who may try to unseat her as Conservative leader. This may also happen in response to the first round defeat. If you think she loses, go to 6
  4. A second round defeat could cause a crisis. May would have to resign. If you think this would lead to a general election, go to 5. Another possibility is that Parliament steps in and asks the EU to delay the implementation of Article 50. If you think this happens, go to 7. If you think that Parliament doesn’t manage this, go to 6.
  5. An election in such chaotic circumstances would almost certainly mean losses for the Conservatives. That would mean either a Labour majority, or a minority backed by the SNP (could also happen without an election). Scotland voted remain and the SNP argues in favour of membership of the single market and customs union. This could mean the softest Brexit possible, including the Norway option. But if you think Labour wins outright, go to 8.
  6. As the law is now written, Britain will leave the EU at the end of March whatever happens. This would be a problem for a new Conservative leader who would almost certainly be from the Leaver wing of the party. A new PM might try to renegotiate but the EU would probably refuse. This would lead to a hard Brexit, a plunge in sterling and economic disruption.
  7. The EU may be willing to allow for some extension to the withdrawal process if they thought that Britain might relent on Brexit, although the May 2018 European parliamentary elections would be a problem (Britain’s MEPs leave at that stage). The Norway option of EEA membership might just be possible, as might a referendum although that would take time to organise. If you think a referendum happens go to 9.
  8. If Corbyn has a majority, he will have no need to buy off the remainers and push through a referendum. And he may want to pursue a radical agenda without EU constraints. Expect a deal very similar to the one proposed by May.
  9. The campaign will be bitter and divisive. If Leave wins, go to 6. If Remain wins, the markets will pick up and the economy will get a boost. The big question is what effect it has on the political system

Economist columnist, opinions generally my own, typos always my fault. Author of Paper Promises, The Last Vote and The Money Machine

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