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Bill Diviney, senior economist at ABN AMRO, suggests that the UK Prime Minister May made a last-ditch attempt to sell her Brexit deal to MPs today, outlining new bill that combines elements where the government was prepared to compromise with the opposition Labour Party until recent talks broke down, with the offer of a vote on a second referendum.

Key Quotes

“The condition for such a referendum is that the deal passes the first stage of voting, and it is as yet unclear whether the vote will be a ‘free’ one (i.e. without party leaders ‘whipping’ the vote in a particular direction; a free vote would make it more likely a referendum is approved).”

“Alongside the referendum pledge, the new bill contains pledges on maintaining worker and environmental rights at a minimum in line with EU rules, and it also offers the option of a permanent customs union – a key Labour demand – by giving parliament a say in the government’s negotiating goals for the post-withdrawal trade deal.”

“It is unclear just how many MPs will be won over by these new elements to the bill, and some of the right flank of the Conservative Party who voted in favour last time are now either unlikely to do so this time (eg. Boris Johnson) or have already confirmed that they won’t (David Davis, Jacob Rees-Mogg). PM May is clearly banking on the new elements of the bill to win over enough Labour and other opposition MPs to offset any losses on the Conservative side.”

“In the last vote, 30 MPs would have needed to switch votes to get the deal passed. On balance, we think the chances are a little higher the deal passes, but the coming days will be crucial in determining whether the parliamentary arithmetic moves in May’s favour. In light of the considerable political flux in the UK, we are currently reviewing our Brexit scenarios.”