Brexit – What Happens Next?

NOTE: This post was written at 5am on Friday morning, before Cameron announced his resignation.

Once again the polls were wrong, and the UK has voted to leave the EU. Obviously, the ramifications of this decision are enormous both in the short and long term. The immediate question is What Happens Next? There are several significant issues that need to be discussed.

Legal and Constitutional Issues

Firstly, the referendum has no direct legal effect. The UK will not leave the EU on Friday or Saturday or any time soon. Legally, the referendum is purely advisory, and in theory, the government and Parliament could ignore the result of the referendum and choose to do nothing.  However, neither the government or Parliament will do that, and this vote for Brexit will result in Brexit. The reason for this legal vacuum is to allow room for manoeuvre to establish the mechanics of the negotiations required to leave the EU. The only immediate impact is that the renegotiated terms of membership that Cameron managed to secure will not come into effect.

The mechanism for a Member State of the EU to leave is provided for by Article 50 of the Treaty on the European Union. This states, at Art 50 (2) that “A Member State which decides to withdraw shall notify the European Council of its intention”. There is then a two-year period for negotiations although this could be extended by agreement. The next European Council meeting will be held on 28th/29th June. The draft agenda provides for a discussion of the “Outcome of the UK referendum”, but provides no details as to the nature of that discussion. Art 50 is clear that it is up to the exiting Member State to invoke the procedure and start the clock ticking for the negotiations.

Before the referendum, David Cameron indicted that he would be invoke Art 50 quickly, stating

“If the British people vote to leave, there is only one way to bring that about, namely to trigger Article 50 of the Treaties and begin the process of exit, and the British people would rightly expect that to start straight away” [House of Commons, Hansard, 22nd February 2016, Col 24].

Yet, it would be extremely unwise to invoke the Art 50 procedure immediately. Instead, it would be better for the government to pause for a short time, establish a negotiating position and select lead negotiators before invoking Art 50. In turn, such a pause raises the question, persistent throughout the campaign, as to whether there could be a second attempt to renegotiate Britain’s terms of membership either before or instead of invoking Art 50. On Wednesday, Jean-Claude Juncker stated that “out is out” which appears to close down any such opportunity. In order for an orderly exit, the renegotiation should be concluded before any legal or constitutional changes are made in the UK, such as the repealing the European Communities Act 1972, which gives effect to EU law within the UK. Other possibilities such as using Art. 48 to agree a bilateral treaty between the EU and the UK are fanciful and not in Britain’s interest.

Another interesting feature is that the result shows that MPs with 2/3’s of all MPs supporting remain, the House of Commons is substantially out of line with the views of the electorate. This raises the question regarding the conduct of the negotiations and the role of Parliament in scrutinising the proposals and government’s stance. The default constitutional position for international treaties is that it would be up to the government to negotiate the terms of exit with no formal role for Parliament whilst negotiations of the terms of exit are ongoing. This is likely to be unsatisfactory for many MPs, particularly those supporting Brexit, and either votes within Parliament on the renegotiation will be promised as a result of political necessity, or legislation will be introduced securing parliamentary scrutiny over any treaty setting out the terms of Brexit. This may build upon the process outlined under the Constitutional Reform and Governance Act 2010, which grants Parliament a limited power of veto over an international treaty.

Political Considerations – Cameron’s Position

The political implications of Brexit are likely to be dramatic. Despite Cameron’s intentions to remain as Prime Minister, and to “implement the will of the British people”, it seems very difficult to reach any other conclusion than Cameron announcing his intention to resign very soon. This is because the referendum result can only be interpreted as a rejection of a fundamental aspect of Cameron’s economic, domestic and foreign policy. Furthermore, it is a specific rejection of Cameron’s terms of renegotiation, and consequently there will be a lack of confidence in Cameron’s ability to negotiate robust terms of exit. Yet, it must be emphasised that Cameron will be unlikely to leave Downing Street almost immediately, as the outgoing Prime Minister can only tender his resignation once it is clear they can advise the Queen as to who she will appoint in their place (Cabinet Manual, Para 2.10). Usually, this will require a leadership election which will take around 2/3 months. Consequently, any odds that Cameron will move out of Downing Street by the end of June (currently 3/1 with William Hill) are very poor value indeed.

Should Cameron decline to indicate his intention to resign or set out a timescale for his future, the long-stop position is a leadership contest triggered by Conservative backbench MPs through the 1922 Committee. To trigger a leadership contest, there needs to be fifty letters of no confidence in the Prime Minister lodged with the Graham Brady, the Chairman of the 1922 Committee. The number of letters currently lodged is apparently three, with letters from Philip Holborne, Nadine Dorris and Bill Cash already under lock and key with Mr Brady. Overnight, a letter signed by 84 MPs pro-Brexit Conservative MPs was published supporting Cameron whatever the result of the referendum. Whilst this may shore up the Prime Minster’s position for now, it is unlikely to alter the fundamental dynamics in the long term, given that the Prime Minister has indicated his intention not to seek a third term.

An Early General Election?

Watching the BBC, a question of depressing regularity is the whether there should be an early or ‘snap’ general election. Indeed, earlier this week, Jeremy Corbyn stated that Labour was ready for a ‘snap’ general election. This is not going to happen. Under the Fixed-term Parliaments Act 2011, the date of the next general election is 7th May 2020. It can be earlier, only if 66% of MPs vote for an early election, or the government loses a vote of no confidence and no alternative government is found within fourteen days. Neither of those possibilities are likely. A further possibility is that Parliament could repeal the 2011 Act, but this is also unlikely. The issue of an early General Election will be discussed in a later post.