Realignment of UK politics could be here to stay

Subject New UK government agenda. Significance Prime Minister Boris Johnson’s Conservative Party won a substantial majority in the December 12 election by winning dozens of seats that traditionally had been Labour Party strongholds. While Brexit played a crucial role in appealing to first-time Conservative voters, Johnson plans significant investment beyond south-east England to boost the Conservatives’ credentials in the ‘left-behind’ regions of the United Kingdom. Impacts There will be little opposition within the Conservative Party to public-sector reforms designed to improve delivery. The legally binding pledge to leave the EU by December 2020 would increase the chances of a limited EU-UK free trade deal, at best. Poor election results for the DUP and Sinn Fein increase pressure on both parties to revive Northern Ireland's devolved government.

Subject Brexit outlook. Significance If Prime Minister Theresa May can get the Withdrawal Agreement (WA) and Political Declaration on future relations approved in Parliament this week, the United Kingdom should leave the EU on May 22. However, it remains unlikely that her deal will gain a parliamentary majority, setting up a different deadline. The United Kingdom must come up with an alternative plan by April 12 or face the prospect of crashing out of the EU with no deal. Impacts The United Kingdom could have a new prime minister within weeks; a general election cannot be ruled out. The EU will remain distracted by Brexit as it heads into a season of political change beginning with European Parliament elections in May. As a final option, May could commit to resigning to get support for the WA from Conservative Party MPs.


Significance As many as a dozen lockdown parties are now alleged to have been held at Downing Street, significantly damaging Johnson’s support among the public and his Conservative Party. His position as party leader and prime minister is gravely threatened. Impacts Johnson’s domestic troubles, coupled with rising economic concerns, increase the chance of an agreement with the EU over Northern Ireland. Disillusionment with Johnson, opposition to net-zero and culture wars open the door for Nigel Farage’s Reform Party to revive its appeal. Rising inflation threatens to undermine consumer confidence and slow the economic recovery over the coming year.


Subject The package of reforms on a new EU-UK relationship. Significance The agreement between the United Kingdom and its EU partners sets the stage for the UK referendum on EU membership, which Prime Minister David Cameron has set for June 23. Cameron said he had negotiated new terms that would allow the United Kingdom to remain in the EU. Impacts The deal bolsters the campaign to remain in the EU, but the referendum outcome is still highly uncertain. The deal will only come into effect if the outcome is for remaining, forestalling a second referendum for better terms. If the outcome is for leaving, a new relationship with the EU would have to be negotiated during a two-year transition period. It would also probably lead to a second Scottish independence referendum and UK break-up.


Subject The government's preferred timetable for the UK referendum on EU membership. Significance The EU membership referendum will be a major event in both EU and UK political and commercial life. Prime Minister David Cameron's official position is that the poll could take place any time before end-2017. He is less concerned about the likely outcome of the referendum, which he is confident will produce an 'in' result, than about achieving a margin in favour of membership that decisively settles the question and minimises the damage to the Conservative Party arising from the process. Impacts The most likely referendum date is September 15, 2016. This timetable would make the key renegotiation period the first half of 2016, when the sympathetic Dutch government chairs the EU Council. The German government would also prefer the UK referendum to be dealt with relatively quickly.


Significance For the first time, there is a sustained increase in support for Scottish independence. The main reasons include dislike of UK Prime Minister Boris Johnson and his cabinet north of the border, the UK government’s pursuit of a ‘hard’ Brexit and questions about its response to the COVID-19 pandemic. Impacts Soaring Scottish unemployment when the UK furlough schemes end would undermine London’s claim to be protecting Scottish jobs. Rising support for Scottish independence could prompt the UK government to seek a closer trade agreement with the EU. The UK government will be unable to conceal the economic impacts of Brexit under the economic fallout of COVID-19. A Scottish vote for independence would put huge pressure on the UK government to resign and call early elections.


Significance The bill establishes a new statutory regime for goods and services trade within the United Kingdom, which is essential for signing trade agreements. However, it also contains clauses on the Northern Ireland Protocol which threaten to override the legally binding EU-UK Withdrawal Agreement (WA), while giving London new powers over the devolved administrations, including on state aid. Impacts The EU is unlikely to collapse the trade talks with the United Kingdom. An EU-UK deal is still possible because the alternative would seriously threaten Prime Minister Boris Johnson’s political survival. The new bill, on top of COVID-19, will give the opposition Labour Party an opportunity to overtake the Conservatives in the polls.


Significance The opposition now has a real chance to unseat Prime Minister Viktor Orban in the 2022 elections for the first time since Fidesz’s 2010 landslide. Vast incumbent advantages and a likely spending spree fuelled by EU funds still make Orban the likelier winner, but as a political outsider, Marki-Zay may appeal beyond the opposition’s traditional base. Impacts Russia retains an interest in keeping Orban in power and Kremlin meddling in the election is possible. The United States has an interest in change and may contribute to it, for instance through sanctions, as it did in Bulgaria last summer. To avoid appearing to interfere in member state politics, the EU will postpone planned moves to withhold funding from Hungary.


Significance They are intended to set the framework for the future economic relationship between the United Kingdom and the EU. However, they have become a source of deep political division and mistrust, exacerbating concerns about the future of their political and economic relationship. Impacts A further deterioration in UK-EU trade relations would threaten to undermine peace and stability in Northern Ireland. Negative trade news is unlikely to shift opinions significantly on Brexit or support for Prime Minister Boris Johnson. UK hostility towards defence and security cooperation underpinned by EU institutional arrangements will remain strong.


Significance The summit represented an opportunity for UK Prime Minister Theresa May to discuss her Brexit plans directly with other heads of state and government rather than doing so via the European Commission’s Article 50 task force. Impacts The negative mood music from the Salzburg summit is weakening May’s position in her Conservative Party. The poor personal relationship between May and her Irish counterpart Leo Varadkar is complicating discussions on the Irish border. The unity of the EU27 could crumble once trade negotiations bring their divergent interests to the fore. The EU is maintaining its insistence that there can be no ‘hybrid model’ between Norway and Canada.


Subject Brexit and trade. Significance As both candidates for the Conservative Party leadership say they would countenance the United Kingdom leaving the EU without a deal on October 31, the likelihood of a no-deal Brexit is increasing. Impacts A no-deal Brexit would leave the legal status of UK citizens residing in the rest of the EU uncertain. It would cause the pound to depreciate, partially offsetting tariffs and the costs of customs procedures. The EU will likely insist that any future trade agreement is contingent on London fulfilling its financial obligations for leaving the bloc.


Sign in / Sign up

Export Citation Format

Share Document