PM Theresa May Resigns – Now What?

Friday, May 24, 2019 - 10:45am

What Happened and Why Now?

This morning, UK Prime Minister Theresa May announced her intention to resign as leader of the Conservative Party on June 7. On June 10, a campaign to replace her as party leader—and Prime Minister—will begin. She will continue on as caretaker Prime Minister until her successor is chosen.

May had soldiered on for months in the face of escalating threats to her premiership and declining influence both within her own party and the broader UK Parliament. This week, she finally ran out of room to maneuver.

At issue, as ever, was Brexit. After failing to get her negotiated Withdrawal Agreement through Parliament 3 times, the final straw was the overwhelmingly negative response to her proposed “new Brexit deal” earlier this week.

May had been planning to introduce the implementing legislation (known as the “Withdrawal Agreement Bill”) for the Brexit deal today. That legislation would have been amendable to try to find a cross-party majority in Parliament. May proposed several revisions to the agreement, which lost her the support of even more members of the Conservative Party, and her Cabinet.

The proposed compromises included:

  • a commitment to match or exceed EU rules on workers’ rights and the environment;
  • a temporary customs union lasting at least until the next scheduled UK general election (2022);
  • a promise to hold a “confirmatory” second referendum if the legislation had passed.


These provisions were a bridge too far for many Conservative MPs. Andrea Leadsom, the Brexiteer Leader of the House of Commons, quit the Cabinet—becoming the 36th minister to resign under May’s leadership. Sensing the weakness of the PM’s position, Labour leadership also declined to support the compromises—sealing the fate of the legislation before it had even been introduced.

With no possibility to get her agreement through the Parliament, the writing was on the wall for May’s time as Prime Minister.

What’s Next?

Theresa May will continue as leader for the next several weeks, until her successor is decided by Conservative MPs and then the members of the party nationwide. So, she will still be in place to host President Trump during his state visit June 3-5. The Tories aim to complete the leadership contest by the beginning of August.

Whoever emerges as the victor will face the same set of structural challenges that have beset May: a fractured country, an equally divided parliament, and – crucially – an EU27 whose red lines are well established and whose attitude is only likely to harden in the coming months.

There’s a belief, at least in London, that the next UK leader may be able to negotiate changes to the terms of the Withdrawal Agreement and/or Political Declaration on the terms of future trade. Brussels has already rejected this idea. Things like the Irish backstop provisions are non-negotiable from the EU perspective. What may indeed be possible is revising the Political Declaration more towards a CETA-style FTA. However, that would be a significantly more disruptive Brexit than the current Withdrawal Agreement’s baseline.

Early polls of Conservative Party members and the betting markets name former Foreign Minister Boris Johnson as the favorite to become the next Prime Minister. He will be countered by up to a dozen other sitting Tory MPs, including current Foreign Minister Jeremy Hunt, Home Secretary Sajid Javid, and former Brexit Secretary Dominic Raab. All of the contenders support leaving the EU, with some (like Raab) committing to pursuing a no deal exit.

Given the positioning of the candidates to become the next PM, it’s fair to say that the likelihood of a “no deal” Brexit has increased significantly. The UK is also much more likely to need to request another extension to the Article 50 negotiating period beyond October 31 to give the new leader time to try to negotiate changes. It’s far less certain that the EU will grant them such an extension.

For their part, the Labour Party continues to call for a general election, rather than a second referendum, in an attempt to wrest power away from the Conservatives. However, given the current state of the Conservative Party in the polls, and the fact that 2/3 of the House of Commons would have to support a new election, a general election is unlikely at this point.

Timeline:

  • Sunday, May 26 – European Parliament election results announced: the Conservative Party is likely to have been decimated, and could finish in a distant 4th or 5th place, well behind the Brexit Party, Labour, the Liberal Democrats, and even the Green Party.
  • June 3-5 – President Donald Trump visits the UK for a State Visit including meetings with Queen Elizabeth II and PM May
  • June 7 – Theresa May steps down as leader of the Conservative Party
  • June 10 – Conservative Party leadership election begins
  • By August 1 – the winner of the leadership election will become Prime Minister
  • October 31 – the date the UK is currently scheduled to leave the EU with or without an agreement