Prepare for no-deal Brexit?

Philip Hammond refuses to prepare for possibility

Business Insider

Philip Hammond refuses to fund preparations for a no-deal Brexit

LONDON - Philip Hammond has said that it would be irresponsible for the UK government to start spending money on planning for a "no-deal" Brexit and that it is the government's "duty" to reach a deal with the European Union.

In an article for the Times newspaper, the Chancellor said that he will not be announcing measures to get ready for no-deal in the budget next month, in a move that will likely anger those in favour of a hard Brexit in the cabinet.

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Theresa May attempts her best poker face with the 'No Deal' threat - but the EU27 have called her bluff

By Daniel J. McLaughlin

No deal, we were told by Theresa May, is better than a bad deal when it comes to Brexit. This remark in a speech from January was not necessarily a warning to Britons, it was more of a threat to the EU leaders: Britain is prepared to crash out of the European Union, if they cannot negotiate a reasonable deal. This was tough talk in tough times, and her rhetoric was meant to strengthen Britain's position in the negotiations.

The Brexit no-deal threat has failed to pay off, with Politico arguing that it has "fallen flat" among the EU27, with no indication that they are feeling the fear of a British departure. It was meant to imply that the negative consequences of this particular situation would hit the EU27 as hard as Britain, but the threat is clearly not working.

The Prime Minister tried yet again to reaffirm this threat, but in a more subdued manner than earlier this year. She told MPs that the UK can operate as an "independent trading nation" after Brexit, even if no trade deal is reached with Brussels. Mrs May said "real and tangible progress" had been made in the talks, but Britain must be prepared to "every eventuality", one of which, though not directly mentioned, is the prospect of a no deal.

The fifth round of negotiations have begun in Brussels, with both sides hoping to iron out technical issues before EU leaders meet on October 19. During the summit, the leaders will decide if enough progress has been made in the talks to move on to discussions about post-Brexit relations with the UK.

However, there are doubts whether the government is serious about their No Deal threat. BBC Newsnight's Chris Cook calls the government's Brexit strategy on this scenarios "slightly baffling", and he is sceptical on whether they are actually preparing for the possibility. The government, he argues, is "not behaving like it is really preparing for No Deal - and the EU27 can surely see it". He adds that unless the government starts allocating resources for a clean exit in March 2019 that it can control, "no-one will seriously believe they're considering it".

The New Statesman's Stephen Bush argues that there are two ways to assess the Prime Minister's no deal plans. Firstly, to determine that it is "plainly ridiculous" – "you can't adequately plan for no deal any more than I can adequately prepare to bungee jump off the Grand Canyon with no rope". The second way is to discover that the truth about planning for no deal is that it is not intended to actually plan for no deal.

Mrs May is not just playing to the EU when she announces that the government is planning for no deal, she is playing to her own MPs and the opposition, too. Bush calls this approach "the spoonful of sugar intended to make the medicine go down"; the medicine being the continued jurisdiction of the European Court of Justice during the Brexit transitional period. The Prime Minister is also hoping that it will leave the Commons with an ultimatum: it's my way or the highway. In other words, they will be split between the government's Brexit deal or a catastrophic no deal exit, and they will be forced to opt for the former to avoid disaster.

The prospect of a No Deal was intended to be Britain's trump card during the Brexit negotiations with the EU, but their hand lacks value without conviction. Theresa May has not got her poker face quite right when she threatens the EU27 with the possibility of a No Deal, and they have called her bluff; and ironically, this may be the case if the Brexit negotiations continue to hit stumbling blocks – the biggest of which approaches on October 19 in the shape of the EU summit.

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