Brexit: Changed rules, changed scenario risks – Nordea Markets
Morten Lund, analyst at Nordea Markets, suggests that for the UK PM May, reaching a majority looks far-fetched as on Tuesday 15 January, the House of Commons will finally vote on May’s Brexit deal.
“If the vote fails, the tail risk scenarios could gain momentum, as the Parliament recently has changed the rules. The House of Commons will go to the ballots on the eve of 15 January (20.00 CET time) to decide the fate of Theresa May’s Brexit deal – a vote, that looks destined to fail. Thus, the “MP vote mathematics” does not seem to have changed noticeably since December when the prime minister was forced to postpone the vote in the Commons (and afterwards faced a no-confidence vote in the Conservative Party).”
“Consequently, we expect another defeat to the Government on Tuesday. This also seems to be the consensus in the House of Commons, which therefore has spent more time during the second Brexit debate to discuss “what comes next” instead of the actual deal at hand. Most controversially, the Speaker of the House broke procedural convention and allowed a vote on the future time table. The vote, which the House approved, means that if May’s deal fails, the Government shall within three sitting days (not calendar days) table a motion that “considers the process of exiting the EU”.”
“In other words, the Government must present a “plan B” to the Parliament on the next steps no later than Monday 21 January. Earlier the Government had 21 calendar days to make a statement, followed by another seven sitting days to table a motion.”