The government will seek to overturn the defeat inflicted on its Brexit bill by the House of Lords, sources say.
Peers defied ministers when they voted by 358 to 256 to guarantee the rights of EU nationals living in the UK after Brexit. The government said it was “disappointed” at the first defeat for its draft legislation. MPs will have the chance to remove the Lords’ amendment when the bill returns to the House of Commons. Before then, next Tuesday, the Lords will consider backing other possible amendments to the bill, which authorises Theresa May to trigger Brexit. Government sources said the bill should simply be about invoking Article 50 of the Lisbon Treaty, beginning formal negotiations. The vote came after a heated debate in the Lords where the government was accused of treating EU citizens like “bargaining chips”.
Ministers attempted to stave off defeat, saying the issue was a priority for the government but should be tackled as part of a deal that also protected UK expats overseas. The amendment backed by the Lords requires the government to introduce proposals within three months of Article 50 to ensure EU citizens in the UK have the same residence rights after Brexit.
The Department for Exiting the EU said: “We are disappointed the Lords have chosen to amend a bill that the Commons passed without amendment. “The bill has a straightforward purpose – to enact the referendum result and allow the government to get on with the negotiations.” The government said its position had “repeatedly been made clear”, saying it wanted to guarantee the rights of EU citizens and British nationals “as early as we can”.
Parliament must vote on whether the government can start the Brexit process, the Supreme Court has ruled.
The judgement means Theresa May cannot begin talks with the EU until MPs and peers give their backing – although this is expected to happen in time for the government’s 31 March deadline. But the court ruled the Scottish Parliament and Welsh and Northern Ireland assemblies did not need a say. The government will make a statement to MPs later on Tuesday.
During the Supreme Court hearing, campaigners argued that denying the UK Parliament a vote was undemocratic. But the government said it already had the powers to trigger Article 50 of the Lisbon Treaty – getting talks under way – without the need for consulting MPs and peers. Reading out the ruling, Supreme Court President Lord Neuberger said: “By a majority of eight to three, the Supreme Court today rules that the Government cannot trigger Article 50 without an Act of Parliament authorising it to do so.” Attorney General Jeremy Wright said the government was “disappointed” but would “comply” and do “all that is necessary” to implement the court’s judgement.
Gina Miller, one of the campaigners who brought the case against the government, said Brexit was “the most divisive issue of a generation”, but added that her victory was “not about politics, but process”. Labour leader Jeremy Corbyn said: “Labour respects the result of the referendum and the will of the British people and will not frustrate the process for invoking Article 50.” Article 50 will begin exit talks with the EU, which are expected to last up to two years. The case against the government was brought by Ms Miller, an investment manager, and hairdresser Deir Tozetti Dos Santos. The Supreme Court’s judgement backs that given by the High Court last year, against which the government appealed.
HSBC will move staff responsible for generating around a fifth of its UK-based trading revenue to Paris following Britain’s exit from the European Union, Chief Executive Stuart Gulliver said on Wednesday.
“We’re not moving this year and maybe not even next year,” Gulliver said in an interview on the sidelines of the annual meeting of the World Economic Forum in Davos. “We will move in about two years time when Brexit becomes effective,” Gulliver added. HSBC, Europe’s biggest bank, has all the licenses it needs for such a move, Gulliver said, and would only need to set up a so-called intermediate holding company in France, a move that should take only a matter of months. HSBC’s global banking and markets division that houses those trading jobs made profits of $384 million in the UK in 2015, according to a company filing.
Gulliver has been among the more outspoken global bank chief executives about the impact of the Brexit vote, saying in the immediate aftermath of the referendum last June that the bank could move around 1,000 roles to Paris. Britain’s financial services sector has said it will accelerate plans to move some business overseas after Prime Minister Theresa May said on Tuesday the country will quit the European Union’s single market. Banks had initially hoped Britain could retain the access to Europe’s single market that allows them to trade and sell all financial products from London, meaning they would not have to move staff, but such a deal now looks unlikely. Financial firms instead have shifted to pushing for a transitional period in case it proves difficult to negotiate a favorable deal or if talks are protracted and go beyond the two-year time frame for divorce talks.
HSBC shares were up 1 percent by 0821 GMT, against a 0.8 percent fall in the broader European banks index.
Basically what will move out of London and what will stay? Mr Flint says the issue is around wholesale banking: “This is most at risk because of passporting.” He notes HSBC has a large bank in France which it could divert activity to and adds that the financial industry has a clear view of what it wants but the political situation may make this more difficult.
The pound has fallen below $1.20 amid reports Theresa May will set Britain on course for a “hard Brexit” in a major speech.
Ahead of the address – in which the Prime Minister is expected to signal that Britain is prepared to quit the European Union’s single market – sterling slid to its lowest level against the dollar since October’s “flash crash” in Asian trade. It also fell to a two-month low versus the euro. But the currency edged up slightly, back above $1.20, after it emerged that Donald Trump had told The Times he hoped a new US-UK trade deal could be negotiated “quickly” after Brexit. The pound is 20% down on the dollar since last June’s referendum – a level not regularly seen since the mid-1980s.
While a weaker sterling makes UK goods more competitive abroad, it means imports are more expensive. Analysts said the latest sterling fall reflected market jitters over the Brexit negotiations and the prospect of Britain crashing out of the European trading bloc. Several Sunday newspapers reported that Mrs May will say the UK is prepared to leave the single market, customs union and European Court of Justice in her speech at Lancaster House on Tuesday. Her red lines for the negotiations will reportedly be an end to free movement from the EU and freedom to strike new trade deals around the world – neither of which are thought to be achievable within the single market.
Downing Street described the reports as “speculation” but the approach appeared to be backed up by Chancellor Philip Hammond – who warned the UK could slash business taxes if it is denied access to European markets after Brexit. In an interview with the German Welt am Sonntag newspaper, Mr Hammond said: “If we have no access to the European market, if we are closed off, if Britain were to leave the European Union without an agreement on market access, then we could suffer from economic damage at least in the short-term. “In this case, we could be forced to change our economic model and we will have to change our model to regain competitiveness. And you can be sure we will do whatever we have to do. “The British people are not going to lie down and say, too bad, we’ve been wounded. We will change our model, and we will come back, and we will be competitively engaged.”
Kathleen Brooks, an analyst at City Index, said reports of the UK leaving the single market had been “like kryptonite” to traders. She wrote: “The FX market has spoken, and, as of Sunday night, it is not confident that Theresa May can deliver the necessary clarity and confidence when she lays out her Brexit plans.” Sean Callow, a senior currency strategist at Westpac Bank in Sydney, told Bloomberg: “It is difficult to make the case for the pound to avoid testing – probably breaking – the ‘flash crash’ lows in coming weeks.” The flash crash on 7 October saw the pound fall below $1.19 – its lowest post-referendum level – before recovering. A report published last week said the crash, during Asian trading, was caused by a range of factors, including the time of day.