17 December 2018

Stuart Taylor

17 December 2018

Good morning,

Theresa May’s future might have been settled, at least in the short term, but the process of finding a solution to the Brexit impasse is proving somewhat more difficult.
 
With her withdrawal deal showing no signs of securing the required support to progress through parliament, the prime minister has come under increasing pressure this weekend to cede control over the country’s future to the Commons by granting MPs a series of votes on a range of possible options for the way forward, from the “Norway plus” model to a no-deal Brexit.
 
According to Downing Street, the PM is none too keen on offering parliamentarians a free, non-binding vote on various options, preferring instead to continue negotiating with Brussels to salvage her own withdrawal deal, thought by many to be dead in the water. However, the plan to road test alternatives has the backing of some of the biggest hitters in the cabinet, cranking up the heat on the reluctant PM.
 
Originally proposed by Damien Hinds, the education secretary, on a cabinet conference call last Monday, it has attracted the backing of fellow Remain-supporting ministers, including the chancellor Philip Hammond, business secretary Greg Clark and work and pensions secretary Amber Rudd. Andrea Leadsom, the Commons leader, Sajid Javid, the home secretary, and Gavin Williamson, the defence secretary, are all understood to support the PM’s opposition to Hinds’ plan.
 
And there’s one particular course of action that May will try to quell growing demand for when she visits the Commons later today to deliver what is becoming her weekly ministerial statement. She will once again attempt to suppress calls for a second referendum as she is expected to tell MPs not to “break faith with the British people” and that a second vote would do "irreparable damage to the integrity of our politics" and would "likely leave us no further forward".
 
The prime minister is concerned that going back to the electorate would only prove that “our democracy does not deliver”. However, with no clear way out of the current stalemate, she might be left with no option but to choose between the will of her cabinet and her country.

News

Nearly 200 countries have signed the Paris climate agreement after the rules that will govern the world’s most ambitious climate pact were agreed on Saturday. China, the EU and the US reached a compromise over a single set of rules that will govern how countries measure and report their emissions and climate targets following a fortnight of tense negotiations. (£)
 
Colin Kroll, the co-founder of the popular app HQ Trivia and video platform Vine, has died at the age of 34. He was found by police in his apartment in New York.
 
Ranil Wickremesinghe, who was deposed as Sri Lanka’s prime minister six weeks ago, has been reinstated to his position after his sacking triggered a constitutional crisis and threw the country into political chaos. President Maithripala Sirisena removed Wickremesinghe and replaced him with the controversial former president Mahinda Rajapakse, who is known for his close ties with China and presiding over a brutal campaign to end the country’s civil war. However, the Supreme Court ruled that the president’s decision last month to dissolve parliament and call fresh elections was unconstitutional. (£)
 
Cyclist Geraint Thomas has been voted BBC Sports Personality of the Year 2018. The Welshman, who became the third Briton to win the Tour de France, topped the public vote, with Formula 1 champion Lewis Hamilton second and footballer Harry Kane third.

Business & Economy

Jaguar Land Rover is to announce plans to cut around 5,000 jobs early in the new year as Britain’s largest car maker rolls out its £2.5bn cost saving plan. Back in October, JLR posted a loss of £90m for the three months to September as it suffered from sliding demand for diesel vehicles, poor sales in China and the costs associated with preparing for Britain’s departure from the EU. (£)

Energy giants SSE and npower have ditched plans to merge, blaming "challenging market conditions" and the government's price cap. The two firms had been hoping to seal the merger of their retail operations in the first quarter of next year after it was recently given the green light by the competition watchdog. (£)

Laing O’Rourke, the contractor behind projects ranging from the London 2012 Olympics site to the Scottish Parliament, is under mounting pressure over its financial situation as its banking partners delay signing off on a crucial refinancing. The company is more than two months late filing its UK accounts amid increased scrutiny from lenders and accountants, but its finance director said he was “confident” that it would secure its refinancing before it is due in April 2019. (£)
 
Asos, the online fashion retailer, has issued a profit warning for this year after heavy discounting hit its trading in November. Despite enjoying a 14% growth in sales from September to November, the company said it had seen "a significant deterioration" in November. In a conference call with industry analysts, chief executive Nick Beighton said that levels of discounting in the fashion industry were "unprecedented" at the moment and consumer confidence was “fragile”.

Markets

The week ahead

On Wednesday, the European Commission will outline contingency proposals for the financial sector in case of no-deal Brexit. The plans are expected to allow London-based clearing houses and other market operators to temporarily continue servicing EU clients after Britain exits the EU. The Commission will also rule on whether to propose an “excessive deficit procedure” for Italy after it rejected the country’s 2019 draft budget last month, finding it in breach of EU fiscal rules.
 
On the same day the US Federal Reserve is expected to lift interest rates by 25 basis points when it delivers its monetary policy decision. Fed chair Jay Powell will hold a press conference following the statement and will shed some light on the Fed’s plans next year as the outlook on monetary policy in 2019 and beyond has grown murkier.
 
The following day, the Bank of England will announce its latest interest rate decision. However, continued Brexit uncertainty means a rate increase is highly unlikely. Also on Thursday, Nike announces its latest results, with investors likely to gain a sense of the effectiveness of the controversial advertising campaign featuring American football player Colin Kaepernick.

Finals
APC Technology Group
 
AGMS
Edinburgh Dragon Trust

Int. Economic Announcements  
(10:00) Balance of Trade (EU)
(10:00) Consumer Price Index (EU)

Columns of Note

Writing in the Financial Times, Andrew Hill argues that we should stage a different sort of leadership contest, to crown a new and better way of leading. Hill says future leaders need to be resilient and adaptable, have a deep commitment to diversity and an aptitude for sharing leadership with their teams. (£)

In his column for The Sunday Times, Kevin Pringle explains why he believes higher tax for higher earners in Scotland is a deal worth doing. With the effect of the Scottish government’s income tax measures announced in the past three budgets yielding £182m more during 2019-20, Pringle says that the extra cash will really benefit public services such as the NHS, social care and education. (£)

Did you know?

Coca Cola once tried hidden ‘MagiCans’ that had spring-loaded prizes instead of juice. The promotion backfired, however, after it led to incidences of consumers accidentally drinking the chlorinated water used to make the can feel like it was filled with Coca Cola.

Parliamentary highlights

TODAY

House of Commons
Oral questions
Education (including Topical Questions)

Ministerial statement
Statement from the Prime Minister - Mrs Theresa May

House of Lords
Oral questions
Situation of Rohingya refuges and their safe return to Burma - Lord Ahmed

November 16 statement by the UN Rapporteur on extreme poverty and human rights - Baroness Lister of Burtersett

Prevention of goods entering the UK from Israeli settlements in the Occupied Palestinian Territories - Baroness Tonge

Publication of an Immigration White Paper prior to a debate on section 13 of the European Union (Withdrawal) Act 2018 - Lord Roberts of Llandudno

Scottish Parliament
No business scheduled

TOMORROW

House of Commons
Oral questions
Justice (including Topical Questions)

Ten Minute Rule Motion
European Union (Revocation of Notification of Withdrawal) - Geraint Davies

House of Lords
Oral questions
Support to the government of Nigeria in its efforts to end the violence between herders and farmers - Lord Suri

Future of transport policing in Scotland - Lord Faulkner of Worcester

Whether the Government have received any new information about the seven
allegations against Sir Edward Heath left open at the end of Operation Conifer - Lord Lexden

Effects on waiting times for NHS patients of NHS Foundation Trusts offering private healthcare services - Lord Brooke of Alverthorpe

Scottish Parliament
Ministerial Statement: Preparations for EU Exit

Ministerial Statement: The Conduct of Reviews and Inquiries

Stage 1 Debate: Damages (Investment Returns and Periodical Payments) (Scotland) Bill