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Interel Insights

Interel Insights

INTEREL INSIGHTS

Post-Election Analysis

1 JUNE 2017 Making sense of the chaos

style, and vowed to listen and react ac- of the House of Commons, whilst her As we take stock of last week's cordingly. Indeed, she has already re- predecessor has re- shock General Election result placed her two chiefs of staff Nick Tim- placed Liz Truss as Justice Secretary. and the pieces fall into place, othy and Fiona Hill with outgoing MP She has been moved to Chief Secretary Interel has provided an analysis Gavin Barwell, and is alleged to have of the Treasury in what is being seen of events over the last few days promised Cabinet colleagues a more by some as a demotion and by other and look at what is likely to collegiate, rather than presidential a sideways move. is pro- unfold in the coming days and style of leadership. Conservative back- moted to Secretary for Work and Pen- weeks. benchers will now expect this Theresa sions, whilst his predecessor Damian May to be the one leading to country, Green becomes First Secretary of State not the who led the party at the , a role said to be to a minority result. not dissimilar from the one 1922 Committee had as Deputy Prime Minister dur- Reshuffle ing the coalition, in an effort to move Number 10 towards a more inclusive Theresa May’s political future was de- style of leadership than it has exhibited pendent on her performance at the Rumours of a major reshuffle dissipat- in the last 12 months. 1922 Committee meeting on Monday ed almost as soon as the exit poll hit night. This is the influential committee the airwaves. Moving any big players DUP negotiations representing Conservative backbench down or out would have risked unset- MPs. tling the delicate equilibrium keeping By all accounts she hit exactly the the Prime Minister in place. The Democratic Unionist Party is the right tone to win back enough support None of the previous Cabinet Min- kingmaker in this hung parliament. from her party and dissuade critics isters have been removed, but there Theresa May has been in negotiations from forcing her out in the immediate have been a few changes. The divi- with the DUP since last Friday, but no future. Contrition, humility and a deter- sive , known to have an agreement has been reached yet. Em- mination to get “out of this mess” may uneasy relationship with Theresa May, barrassingly, Number 10 were forced have given her some time to prove her has been brought back as the new En- to retract an erroneous statement that leadership. vironment, Food and Rural Affairs Sec- a deal had been done on Saturday She is said to have acknowledged retary. One time leadership challenger evening. Mrs May met DUP leader criticism of herself, and her leadership has become Leader Arlene Foster on Tuesday and it is be-

2 lieved a deal is close to being finalised. to form a new power sharing Execu- staunchly Eurosceptic MP, as a Minis- The DUP are now saying that any an- tive may force another snap election in ter in the Department for Exiting the nouncement will be delayed due to the Northern Ireland, which no side wants, EU. This was an indication, as reiter- very tragic events of Wednesday morn- or a return to direct rule, which is re- ated by David Davis this week, that the ing of a fatal tower block fire in West garded by nationalists and the Irish Government does not intend to alter London, but Downing Street are brief- Government as illegitimate. The con- its approach to Brexit with regards to ing that any talk of delay is not coming tinued stalemate will have to come to membership of the Single Market or from them, which may point to further an end and will require careful negoti- Customs Union. Baker has spoken of potential problems to come. ation, which is currently underway. a “clean exit” in terms of minimising A confidence and supply relation- Another dynamic to these nega- disruption, but a real Brexit controlling ship is the most likely outcome, which tions is the relationship with the Scot- laws, money, borders and trade at UK means the DUP would back the Gov- tish Conservatives and their leader, level. ernment on an issue-by-issue basis Ruth Davidson. The DUP is the political With Brexit negotiations due to start rather than any formal coalition or home for devout Protestant Christians, on Monday, the DUP deal not yet fi- taking a seat in the cabinet. Crucially, many of whom oppose gay marriage nalised, and May’s authority in serious this would require support for the Gov- and abortion. This is very much at odds doubt, she will need a strong poker ernment’s budget. with the views of Ruth Davidson, who is face to get through these initial stages. The DUP is in a strong position to a firm supporter of LGBT rights. Cru- bring home the bacon for Northern cially without the 12 new Scottish MPs, Queens Speech and Ireland, including increased funding which were secured due to the strong Parliamentary Business for Stormont and increases in health national appeal and campaign run by and education spending, although this Davidson, May would not have been is at odds with the Conservative man- able to form a minority government. This week saw the start of the process ifesto. What is perhaps more signifi- Davidson has sought assurances that of MPs being sworn into the House cant is the consequences for Brexit and any deal with the DUP would protect of Commons and John Bercow was power sharing between the Northern LGBT rights. re-elected as Speaker of the Com- Irish parties. mons, allowing Theresa May to hum- The DUP will want a softer Brexit to Impact on Brexit bly quip that at least someone got a maintain, as far as possible, current landslide. cross border arrangements with the The next big event will be the Republic of Ireland. Former First Min- Stripped of her authority, Mrs May is Queen’s Speech, which is given at ister Arlene Foster has said this is a red now caught between the Brexiteers the State Opening of Parliament and line for negotiations. who will plot against her if she softens marks the beginning of a new Parlia- In addition, Sinn Féin, the DUP and her approach, and the pro-Europeans mentary year. It was due to take place other parties are in a renewed effort to who have renewed hope for just that. on Monday 19th June. However, it is restore the devolved assembly in Stor- This is further bolstered by the need to now going to be delayed due to the mont. The Irish and UK Governments do a deal with the DUP and the elec- hold up in negotiations between the have previously been brokers in these tion result, which it could be argued, Conservatives and the DUP. negotiations as neutral parties. How- removed the mandate for a hard Brex- This speech will set out the Govern- ever, the UK Government’s impartiality it. ment’s legislative agenda for this Par- may be jeopardised if they are to rely An indication of her intentions was liament, which may now hinge on what on DUP support in Westminster. Failure the appointment of , the the DUP has agreed to back.

3 Given the fragility of May’s majority results, Jeremy Corbyn seems to have Another election and the DUP agreement, the Conserv- vanquished much of the criticism that ative manifesto may well be stripped has haunted him throughout his lead- to its bare bones and any contentious ership. Most in the Labour Party seem Another election in the next 12 months measures are likely to be abandoned content now to get fully behind him would mean a fifth national vote in five to avoid defeat in Parliament. and it is rumoured that heavy hitters years. But with turnout slightly up from We may see core DUP manifesto Ed Miliband and could 2015, political fatigue does not seem commitments be included, such as the return to the frontbenches. to have taken root just yet. abolition of short haul Air Passenger A question remains over whether this If another election is called, it would Duty for Northern Ireland, and May popularity wave that Corbyn current- likely be out of necessity, not oppor- could use the DUP deal as a conven- ly rides may have already hit its crest. tunism as it was this time. If the Con- ient way to drop unpopular policies Corbyn, unlike May, is a campaigner. servative deal with the DUP collaps- such as the plan to scrap the triple lock He has been at his best when he has es or legislation can no longer move on pensions, the “dementia tax”, and been in campaign mode; both during through the Commons, the chamber means testing winter fuel payments. the two leadership elections and in this may become effectively defunct. Like- These could be replaced with a pledge General Election (although interesting- wise, if a bill emerges which threatens to launch a consultation on the future ly not so during the EU Referendum to radically undermine the Govern- of social care instead. We are also un- campaign). As Leader of Her Majesty’s ment’s position on Brexit, the Prime likely to see the removal of the ban on Opposition, Corbyn has struggled to Minister might think it obligatory to grammar schools, which had caused portray himself as a Prime Minister in get a renewed mandate on the issue. unease even in the Conservative party. waiting, and statesmanship is an art An election could also be forced by a A large proportion of the Queen’s he seems yet to have mastered. He will , which could Speech will be to legislate for Brex- find it easier growing into the role if his happen at any time. it, including the Great Repeal Bill. It party can unify around divisive issues, Labour would be up for the chal- is also understood that alongside this none more so than Brexit. lenge. However, the Conservatives, there will be several other bills on top- Having had a difficult campaign, scarred by the last campaign, are ics which could include immigration, Tim Farron has resigned from the post currently in no fit state to fight an- tax, agriculture, trade and customs re- he held for two years as Leader of the other election, and would be nervous gimes, fisheries, data protection and Liberal Democrats. Despite increasing about losing. The most significant sanctions. All of which provide oppor- their seats in Parliament from 9 to 12, strain would be on the smaller parties. tunities for MPs and Peers to shape the this fell far short of Lib Dem hopes The SNP, Lib Dems, Greens and UKIP direction of Brexit. and crucially was nowhere near early don’t have the same financial backing With no formal majority, and re- predictions. Mr Farron had a dreadful as the larger parties and struggled to newed tensions in the Conservative start to the campaign, finding himself cut through in an election which saw Party over the shape of Brexit, Mrs May dogged by questions about his views a shift back to two party politics. They faces an almighty challenge to oversee on LGBT rights, and unable to get all saw a decreased vote share in last one of the largest constitutional and break through on any other political Thursday’s election and they may find legislative projects ever undertaken in issues until later in the campaign. The it even harder to raise enough funds UK history. party will now choose a new leader, to maintain the kind of campaign in- with Jo Swinson and , who frastructure needed to compete with Labour and Lib Dems both retook their seats in this election the Conservatives and Labour. Anoth- having lost out in 2015, favourites for er election within 12 months could be the job. one fought almost entirely between the The Labour Party is a remarkably hap- two parties, possibly leading to some py place at the minute, something it A different dynamics in the results. has not been for the last two years. Af- ter a surprisingly good set of election

4 For more information, contact George McGregor, UK Managing Partner

+44 (0) 207 592 3800 [email protected]

www.interelgroup.com

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