Postponed vote on Brexit deal yet another blow for UK retail

In what seems like the metaphorical cherry on top of a year of uncertainty for UK retail, Theresa May cancelled Parliament’s vote on her EU Withdrawal Agreement on Monday, just a day before it was set to go ahead. The Prime Minister is holding talks with Dutch PM Mark Rutte and Germany's Angela Merkel today in the hopes of saving her Brexit deal.

Speaking in the House of Commons on Monday, the Prime Minister said that despite MPs offering “broad support for many key aspects of the deal” - a point that was met by laughter from the opposition - she had made the decision to postpone the crucial vote due to continued “deep and widespread concern” over the Northern Ireland backstop.

May said that she believed by addressing these concerns in the next few days she would still be able to get the deal through by “looking closely at new ways of empowering the House of Commons to ensure that any provision for a backstop has democratic legitimacy".

May postpones Brexit deal vote over Northern Ireland backstop concerns

The news - quite unsurprisingly - didn’t go down too well in Parliament. Commenting on the news in a Facebook page, Jeremy Corbyn said: “The Government has decided Theresa May's Brexit deal is so disastrous that it has taken the desperate step of delaying its own vote at the eleventh hour.

“We have known for at least two weeks that Theresa May’s worst of all worlds deal was going to be rejected by Parliament because it is damaging for Britain. Instead, she ploughed ahead when she should have gone back to Brussels to renegotiate or called an election so the public could elect a new government that could do so.

“We don't have a functioning government,” he added.

Commons speaker David Bercow didn’t mince his words either, describing May’s last-minute decision to postpone the vote - despite “no fewer than 164 colleagues [taking] the trouble to contribute” - as “deeply discourteous.”

European Council President Donald Tusk said the 27 remaining EU countries would not "renegotiate" the deal.

Unwelcome news for UK retail

The news comes as yet another blow for UK retail. The country has been struggling with continued uncertainty surrounding the UK’s exit of the European Union, and this extension has only added to concern. As more time passes without May’s Brexit deal being agreed, the likelihood of a hard Brexit continues to mount.

Last month, a survey conducted by Retail Economics and Squire Patton Boggs found that more than a third of UK retailers aren’t fully prepared for the potential outcome of a no-deal Brexit.

“With just over three months to go until the UK leaves the EU, any delay to a future agreement is particularly concerning,” BRC chief executive Helen Dickinson said in a statement.

“Retailers urgently need certainty about what our future trading relationship with our neighbours on the continent will be.

“A no-deal outcome would harm consumers, resulting in higher prices and less choice on the shelves. We call on Parliament to urgently find a workable proposal to avoid a catastrophic no-deal Brexit. Time is running out.”

UK retail footfall has declined in every month of 2018 according to retail intelligence company Springboard, with the rate of decline increasing in magnitude in each month since August.

Earlier this month, the Bank of England estimated that a no-deal Brexit could drive up UK shop prices by as much as 10 per cent.

So what now?

Well, Theresa May is now looking to make changes to her deal to ensure it is passed in the House of Commons as pressure continues to grow with the increasing likelihood of a no-deal Brexit. When that will be, no one is sure. While May often cited a 21 January deadline for coming back to the Commons with a deal, the House of Commons announced during a Monday evening #AskTheCommons Q&A session on Twitter that the latest date for the government to reach a deal would be 28 March.

According to a Sky News analysis, before the scheduled Brexit deal vote, 184 MPs were expected to vote for Mrs May’s deal, while 395 are expected to vote against it. The figures show only one Labour MP would have supported the deal.

Photo credit: Pexels, Dominika Gregušová