Pound Tumbles As Theresa May Faces Leadership Challenge Over Brexit Chaos

It might be a modest exaggeration it to say that Theresa May’s position as Prime Minister is doomed, but that is the general direction as the newsflow for the British PM remains overwhelmingly bad. Scandals aside, May seems to be falling into the growing gulf between Conservative MPs who are pushing more strongly for a “hard” Brexit as negotiations with the EU founder and those who are increasingly alarmed at the prospect, making them more desperate to ensure a softer Brexit.

After Theresa May delivered her “disastrous” conference speech in Manchester on 5 October 2017, there was press speculation that between 30-35 MPs in her party were prepared to sign a letter supporting a no confidence vote in the Prime Minister. Since then, we’ve seen the resignation of two of her ministers due to different scandals, continued party infighting and lack of progress on Brexit negotiations. And, according to articles in the weekend press, this number of party rebels has risen to forty, leaving her eight short of facing a potential leadership challenge if she lost a no confidence vote. From Sky News:

Forty Conservative MPs are reportedly prepared to sign a letter of no confidence in Theresa May, amid claims she is being held "hostage" by two members of her top team. The disclosure in the Sunday Times will pile the pressure on the Prime Minister as she enters a crucial period in the Brexit negotiations and comes as she attempts to steady the ship following the resignations of two Cabinet ministers. The total is eight short of the number needed to trigger a leadership contest under Conservative Party rules. There was a mixed reaction to the news from prominent Tory MPs. "I have not heard this", one told Sky News, while another said the 40 figure "doesn't sound right". But others said it was "around that number" and it "probably is (accurate)".

A report in the Independent quoted a “senior Tory MP” who told the newspaper.

“Patience is wearing very thin and in some cases, it has snapped.”

Compounding May’s woes, a “secret” letter from two of her most senior (and controversial) ministers seeming to instruct her on how to pursue a “hard” Brexit was published in the press. The letter is titled “EU Exit – Next Steps” and ironically marked “For your and Gavin’s eyes only”, which refers to May’s Chief of Staff, Gavin Barwell. The letter is being characterised as a “soft coup” attempt by the ministers, whose falling out after the Brexit referendum paved the way for May to become prime minister. According to The Independent.

A secret letter from Boris Johnson and Michael Gove giving Theresa May instructions on how to orchestrate a hard Brexit has emerged. The memo demands the Prime Minister, who looks increasingly fragile following the departure of two of her Cabinet ministers in as many weeks, "underline her resolve" for leaving the European Union, according to The Mail on Sunday. The letter also sets out a date for transition arrangements between the EU and UK to end of 30 June 2021, the newspaper said. Mr Johnson and Mr Gove are also said to have urged the Prime Minister to ensure members of her top team fall behind their Brexit plans by "clarifying their minds" and called for them to "internalise the logic".

The leaked letter appears to make a thinly veiled attack on Chancellor Philip Hammond, who backed remain and wants a softer Brexit, for lacking the "sufficient energy" in preparing to the UK's future outside the bloc. A senior Government source told the Mail the Foreign Secretary and Environment Secretary had conducted a "soft coup" and described Ms May as "their Downing Street hostage".

It states: "Your approach is governed by sensible pragmatism. That does not in any way dilute our ambition to be a fully independent self-governing country by the time of the next election. If we are to counter those who wish to frustrate that end, there are ways of underlining your resolve. We are profoundly worried that in some parts of Government the current preparations are not proceeding with anything like sufficient energy. We have heard it argued by some that we cannot start preparations on the basis of 'No Deal' because that would undermine our obligation of 'sincere co-operation' with the EU. If taken seriously, that would leave us over a barrel in 2021. We all want you to push your agenda forward with confidence and have your Government articulate the following..." The letter suggests both men have set aside their differences following last year's Tory leadership contest, when Mr Johnson dramatically ruled himself out of the race after Michael Gove’s shock entry into the contest.

Sensing an opportunity to capitalize on May’s increasingly weak position within her own party, the opposition Labour Party offered to work with the Prime Minster to achieve a softer Brexit. From Bloomberg.

The U.K. Labour Party accused Theresa May of lacking the support within her Conservative Party to deliver a Brexit that will protect jobs, offering her a cross-party deal that will only add to pressure on the embattled prime minister. Keir Starmer, the party’s Brexit spokesman, wrote to May on Monday telling her there was a “sensible majority” in Parliament to secure a two-year transition deal for after Brexit. That would allow Britain to stay inside the European Union’s single market and customs union after 2019 while it completes trade talks with the bloc. He said the opposition to such an arrangement came from Conservatives. “Over recent weeks, it has become increasingly clear that you alone do not have the authority to deliver a transitional deal with Europe and to take the necessary steps to protect jobs and the economy,” Starmer wrote in the letter, which was released by his office. May is unlikely to welcome Labour’s offer, which highlights the fragility of her position.

To make matters worse, the debate on Brexit legislation – a.k.a. the EU Withdrawal Bill – kicks off again in Parliament tomorrow. The debating process will be agonizingly slow, taking eight days to discuss hundreds of proposed amendments, many from May’s own party who are trying to maintain close links with the EU.

The threat to May’s leadership has trickled down through to the markets, and seen Sterling fall by as much as 1.0%, below 1.3070 against the dollar, in early trade, sliding the most in a week on concern May’s authority was at risk from a potential leadership challenge with only a fortnight before the government needs to show “sufficient progress” on Brexit.

According to Bloomberg, which cited to traders in London, leveraged accounts were aggressively selling the pound. The yield on 10-year U.K. government bonds fell 2bps to 1.32%. The FTSE 100 rose marginally as Sterling assets were re-priced. 

Aside from May suddenly offering a sweetened deal to the EU – and she must be tempted – we would be surprised if the number of Conservative MPs prepared to sign a declaration of no confidence isn’t closing in on the critical threshold of forty-eight by the end of the debate.


east of eden Gaius Frakkin'… Mon, 11/13/2017 - 07:49 Permalink

Well, it just isn't that simple. Everything, from banking regulations to trade regulations are tied up in the EU. Leave and they will simply block your trade goods, your currency will collapse, banks will go bust because nobody will be able to pay their debts and you would have not only chaos, but very likely civil war.Do you people even fucking THINK?

In reply to by Gaius Frakkin'…

French Bloke DetectiveStern Mon, 11/13/2017 - 18:47 Permalink

May is a traitor to the Britsih people. She allowed the terrorists who did the Manchester bombing to live in Britain (as well as all the rest) whilst recuiting their families to try to take out Gadaffi in Libya (which failed). All terrorists in UK were on the watch list and none prevented from doing what they did. She has lots of blood on her hands. She should be gone. And replaced by who exactly? Boris would sink the tories in no time at all. Maybe that's the next step in the zio plan...

In reply to by DetectiveStern

EddieLomax elegance Mon, 11/13/2017 - 07:45 Permalink

Johnson and Grove are right, the EU wants to have the UK over a barrel at the end, Theresa May will be Tspira's 2.0.The only way to succeed here is to play along with their ridiculous demands and make some credible but impossible for them to fulfil demands in return.  Such as a payment for the EU assets that the UK has funded over the years.In the meantime get busy with New Zealand, Australia, Canada, Norway, USA, etc signing trade deals.  Keep them under wraps until the brexit day looms and then release them one a week after brexit - hit the market hard and every bit of bad news will be smothered by good stuff.A USA-UK trade deal would be huge too, the Germans and French would see their UK car markeshare stolen by the USA.  That way the USA can export its recession, meanwhile the EU has a doubly hard recession and has to find another 10 billion pounds to plug the gap from the UK leaving without even its usual 5% increase of budget.Perfect.

In reply to by elegance

adamas Mon, 11/13/2017 - 06:34 Permalink

Theresa May is an utter disaster. She was a remainer who suddenly became PM because we voted BREXIT and Cameron quit. She should have declined the job because the next PM should have been a committed leaver so they could have acted and spoken with integrity. She's a socialist to boot.

GreatUncle Mon, 11/13/2017 - 06:41 Permalink

Hard BREXIT,if you choose any other path like selling out the population as economic serfs gets the politicians hung...trying to keep the UK in and ruled by an EU commission when parliament only rubber stamps EU decisions then says there is nothing they can do because the EU commission says so same result.Now pick your poison UK parliament ... either way YOUR FUCKING INTENT IS NOW KNOWN AS TO HOW YOU WOULD TREAT A SUBSTANTIAL SECTION OF THE POPULATION.Nope UK enemy parliament all enemy combatants and all who work for them in whatever position ... You might want to consider allowing the population to be armed because I just see globalist liberal BREMAIN as the enemy who seek to enslave the population. Now fuck off while you can still breathe ...

GreatUncle GreatUncle Mon, 11/13/2017 - 06:55 Permalink

For those UK politicians not realising their duty with the UK consititution ... asswipes.1.) Parliament is sovereign and the highest sovereign. (you should not be trying to make the EU a higher sovereign than yourself)2.) No parliament is allowed to bind a future one. (Any agreement, treaty previous or current parliament makes it only bound for the term of that parliament alone)My only thought now is it possible to create a "Free British Parliament"?Using the same British citizens who are all part sovereign if they can stand in parliament?If so then it will be a way to challenge and clear out the obvious criminality would it not.

In reply to by GreatUncle

EddieLomax GreatUncle Mon, 11/13/2017 - 07:51 Permalink

Technically the sovereign is the only "sovereign" force in the UK.  All UK bills must be approved by the Queen, in effect parliament only advises the Queen.Its a great system since the Monarchy can never be wrong, instead the parliament must be wrong and the people should choose a new one to advise the queen.Meanwhile all power and authority in the UK derives from the queen.  So the judiciary takes its power directly from the Queen (in a court of law in the UK the judge sits in the place of the Queen), this is a vital part of British freedom.  The Yanks freedom relies on a scrap of paper (declaration of independence), British on the crown, both work in giving a fundamental liberty that has so far stopped outright despotism and long may they continue to.

In reply to by GreatUncle

brushhog Mon, 11/13/2017 - 06:49 Permalink

Meanwhile, as they drag their feet 150k new muslim migrants are flooding England every month. By the time anything happens, the left will have the votes to squash any limitations on immigration and/or terror. Brexit was a valiant last gasp.

OverTheHedge brushhog Mon, 11/13/2017 - 08:02 Permalink

And then the action will not involve ballots, but bullets. Hyperbole, but if you remove people's ability to make changes peaceably, then they will make those changes anyway. All you need is to convince the 18-25 year old that their lives would be oh so much better, and let the mayhem ensue. No job, no prospects and no way out will make for a very good incentive to clear out the dead wood. Just make sure you are not on the list as "dead wood".

In reply to by brushhog

Everybodys All… Mon, 11/13/2017 - 06:51 Permalink

Imo she is obviously trying to run the clock out with the hope that the people of the UK will decide that Brexit is not for them after all. Can it be any clearer that has been the plan all along?  The UK is no closer to Brexit than they were when the vote occurred.

adonisdemilo Mon, 11/13/2017 - 07:23 Permalink

Obvious to me that there are traitors in the British Government who would prefer that Drunker Junker were head of state instead of Queen Elizabeth.OFF WITH THEIR HEADS. (it worked OK in the past)

overmedicatedu… Mon, 11/13/2017 - 07:44 Permalink

pols all look incompetent and fools.in every western .gov : it is very hard to comply with the elite demands and what the pols tell the people..makes for divided government and rediculous policy mismash to  try meet both goals..the art of .gov is to make ave people think simple policy is sooo complex, when the complex part is fitting in all the lies to comply with the elite demands..some pols are better at it than others..think bill clinton

mog Mon, 11/13/2017 - 08:16 Permalink

Britain voted Brexit in the biggest turn out in its history.We expect to leave in 2019 at the end of the Article 50 date.Nothing was said about transition periods in the run up.Out 2019 or May and the neo libs who have hijacked the British conservative party will answer in the ballot box.

Captain Nemo d… Mon, 11/13/2017 - 08:22 Permalink

Nice. Keep changing leaders so that in the end no one person can be held responsible for any !@#$ and everyone has someone else to blame. Sometimes division of responsibility makes it easier to mess things up.