Free parliamentary vote on Brexit preferable to referendum

THE New Year begins with the British parliament in gridlock over Brexit. With fewer than 90 days until the UK leaves the European Union on March 29, this impasse is bad both for democracy and the economy.

The way out could be a free vote for MPs on both sides of the House. Indeed Liam Fox, a medical doctor who has become a popular and respected International Trade Secretary, indicated that the Cabinet is seriously considering the possibility. A free vote would kick divisive party politics into touch. It would allow the Cabinet, Conservative, Labour, Liberal, Scottish Nationalist and Northern Ireland MPs to vote with their own consciences. The Brexit decision would thus become Parliament’s national cause towards the best way forward for the British people.

The first free vote would be on Prime Minister Theresa May’s Withdrawal Agreement. The biggest opposition on both sides of the House is on the so-called “backstop” to ensure that the border between Ireland and Northern Ireland remains open. The backstop, an effective insurance policy, would come into effect if Britain’s intended free trade agreement with the EU takes longer than expected. The backstop keeps the UK within the EU’s customs union so that there are no hindrances on the Irish border. MPs have threatened to reject Mrs May’s agreement as they fear that the UK would be locked into the customs union in perpetuity. Under those circumstances, Dr Fox’s trade department would not be allowed to negotiate independent trade deals with North and South America, Asia, Australasia, Africa and elsewhere. Mrs May is attempting to get concessions from the EU. If she succeeds, she may persuade Conservative and moderate Labour MPs to vote for her deal.

Dr Fox favours Mrs May’s compromise agreement and her political declaration that outlines the post-Brexit relationship with the EU. He fears that if MPs do not accept her deal, there would be a 50-50 chance of no Brexit. That would be a betrayal of the majority who voted to leave the EU, and would shatter the trust between parliament and the people.

If MPs decide not to accept Mrs May’s agreement, there could still be a free vote on several other alternatives. A combined European Economic Area (EEA) and European Free Trade Association (EFTA), the so-called “Norway option”, has been mooted. In terms of this accord, the UK would have a free trade deal with the EU. But it would still be part of the single market – i.e. be subject to the EU’s free capital, goods and services trade and movement of people. But freedom of labour would counter the 2016 referendum decision to curb EU immigration. Moreover, a UK deal would have to be accepted by Norway and other EFTA nations. The UK would also have to stay in the EU customs union to keep the Irish border open. Some Labour and Liberal MPs would vote for the deal, but Conservative and Labour Brexit proponents may be against it.

Despite the Brexit mess, the sterling-dollar rate is still 6% above the late 2016 lows, albeit 14% below levels just before the June 2016 referendum. If there is no deal, the Bank of England would probably cut rates and pump money into the system. The result would be pound weakness and a possible test of the 2016 nadir. A May deal or referendum announcement would likely precipitate a sterling rally.

The vast majority of MPs, with the exception of Tory Brexiteers, would vote against “no deal” as they fear an economic crash. Brexitiers say that a “clean break” under World Trade Organisation terms provides opportunities. To prevent a crash out, there could be an agreed adjustment period and in return the EU would receive a financial settlement. If all options fail, MPs could vote for a second referendum. But there are several problems including lengthy implementation delays, possible unacceptable questions and continued divisions in society.

© Copyright Neil Behrmann

This editorial was first published in The Business Times, Singapore
Neil Behrmannis London correspondent of The Business Times. Jack of Diamonds his thriller on global diamond mining and smuggling, has recently been published. It is the sequel to the thriller, Trader Jack, The Story of Jack Miner.

See reviews of both books on: https://www.amazon.co.uk/Neil-Behrmann/e/B005HA9E3M

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