The House of Commons will sit on Saturday for the first time in 37 years as the clock ticks towards Halloween, the date Britain is due to leave the European Union.
Frantic shuttle diplomacy has been conducted between London and Brussels as both sides try to put together an agreement covering the UK’s departure from the EU.
Yesterday, they said a deal had been reached, which must now be approved by Parliament.
“The initiative now lies with him”
MPs will be meeting on the day Parliament had ruled that, in the absence of a deal, Prime Minister Boris Johnson must ask Brussels for another extension to its withdrawal timetable. All 27 other countries must agree, otherwise Britain leaves on 31 October with no agreement.
This morning, writing on the influential Conservative Home website, Andrew Gimson stated: “Boris Johnson has confounded his critics. They said he could not get a deal, and he has got one. We do not yet know whether he will get the deal ratified by Parliament, but the initiative now lies with him.”
On the stock market, the blue-chip FTSE 100 index was down 0.34% at 7,157.91, while the FTSE 250, which has a more domestic focus, was 0.16% higher at 20,253.48.
Companies in the FTSE 100 index earn about 70% of their revenues abroad, which means not only that they are insulated to a considerable extent from any UK economic problems but that a weaker pound can inflate their profits, as foreign-currency earnings are translated into a devalued sterling.
Trade UK 100 - UK100 CFD
For that reason, the correlation between the performance of the FTSE 100 and the ups and downs of the Brexit negotiations has been less pronounced than may have been expected. In the middle of this week, as talks seemed to be encountering some heavy going, the index stood at about 7,203, higher than now, when agreement has been reached.
Its 12-monthly high was seen on 29 July, when it touched 7,686.01 and its low point during the period was 27 December 2018, at 6,584.68. A year ago, on 16 October 2018, it traded at 7,059.40, meaning relatively little net change over the 12 months.
Sterling volatility against the dollar
The FTSE 250 index has fared overall rather better than may have been forecast, given its member-companies are more vulnerable to Brexit-related turmoil than those of the international FTSE 100.
In the middle of this week, the FTSE 250 traded at about 20,047 while a year earlier, on 16 October 2018, it stood at 19,149.87. But is plunged to a deep 12-monthly low point of 17,090.47 on 27 December while 13 September this year saw a high point of 20,195.75.
Meanwhile, sterling has, perhaps surprisingly, faced a stormier time in relation to the dollar than to the euro. Some may have expected its dollar value to reflect the talk of fruitful post-Brexit trade deals, but over the course of the past 12 months, there has been greater volatility than against the single currency.
Against the euro, the pound was higher midweek than a year ago, trading at €1.1564 against €1.1404 on 17 October 2018. Its low point for the 12-month period was, as with the dollar, on 9 August at €1.0737 and the high point was, again, on 13 March, at $1.1763.
Should Parliament reject the deal, the provisions of the law demanding an extension would come into effect. Mr Johnson and his Cabinet colleagues do not want another extension, and there have been suggestions he may comply with the law while simultaneously asking the EU not to grant his request. This, in turn, has prompted accusations that the Prime Minister would actually be breaking the law were he to behave in this way.
First weekend sitting since Falklands campaign
Britain’s constitutional crisis dates back to the June 2016 referendum result in which the UK voted to leave the EU. Most MPs favoured remaining in the bloc, despite an election in 2017 in which most of them said they would respect the referendum.
Mr Johnson heads a minority Government, meaning that, while his Conservatives are the largest single party, they do not have a majority over the other MPs put together, making them vulnerable to being outvoted. In the resulting political turbulence, some MPs have formed what has seemed like an alternative government, passing measures such as the extension law, against the opposition of the Cabinet.
It has even been suggested that a government of national unity could be formed, displacing the Tory administration and headed either by Labour Party leader Jeremy Corbyn or another senior politician. Mr Johnson has called for a general election, but sufficient opposition MPs have formed a blocking minority that, under the law, prevents him from doing so.
Britain’s unwritten constitution makes all this possible, because it contains no clear division between the legislature on the one hand and the executive on the other. The intervention of the Supreme Court, established relatively recently, in the Brexit process has increased calls for constitutional reform involving a clear division of responsibilities.
Parliament last met on a Saturday in April 1982, in the wake of Argentina’s invasion of the Falkland Islands, a British territory in the South Atlantic. Then Prime Minister Margaret Thatcher announced the UK would send a military task force to liberate the islands, which duly took place.