This paper discusses the way that Parliament scrutinises the Government's proposals for taxation, set out in the annual Budget statement. It looks at how this procedure may be affected by the timing of a General Election, and the decision in 2017 to move the Budget from the Spring to the Autumn. It also provides some suggestions for further reading.
Documents to download
Brexit delayed again: until 31 October 2019? (469 KB, PDF)
EU leaders at the European Council meeting on 10 April 2019 agreed to extend the Article 50 period in order to delay Brexit for a second time.
The first Article 50 extension
The first extension of Article 50 was agreed on 21 March and provided for an extension until 22 May if the UK-EU Withdrawal Agreement (WA) had been approved by the House of Commons by the original Brexit date of 29 March. Alternatively, it provided for an extension of Article 50 until 12 April if the WA was not approved, by which point the European Council expected the UK to “indicate a way forward”. The WA was rejected for a third time by the House of Commons on 29 March.
On 2 April, the Prime Minister proposed talks with the Leader of the Opposition to agree a deal enabling the UK to leave the EU by 22 May. This would involve approval of the WA and an agreed approach to the future UK-EU relationship. If an agreed approach is not possible, the Government would seek to agree with the Opposition on a number of options to be put to the House of Commons and the Government would be ready to “abide” by the decision of the House. The plan envisaged that the WA would be approved and legislation to implement it would be passed by Parliament by 22 May in order to avoid UK participation in the European Parliament (EP) elections. Mrs May said the plan would require a further extension of Article 50. The Labour party leader agreed to talks and these are ongoing.
After votes enabling non-government MPs to control the agenda of the House of Commons on specific days, the Cooper bill obliging the Government to seek another Article 50 extension passed its various Commons stages in one day on 3 April. It took longer to get through the House of Lords, but eventually received Royal Assent on 8 April.
On 5 April, the Prime Minister wrote to the President of the European Council Donald Tusk seeking a further extension of Article 50 until 29 June. She said she accepted the EU’s view that if the UK were still a Member State on 23 May, it would be required to take part in the EP elections. She said that while it was beginning preparations for the poll the Government wanted to agree a timetable for ratification of the WA before the election date in order to cancel participation. Mrs May referred to the ongoing talks with the Labour party to agree a unified approach and the alternative plan of putting different options to the House of Commons.
The European Council agrees a second extension
Prior to the European Council meeting on 10 April, President Tusk proposed a flexible extension of up to a year, which could be ended early if both the UK and EU had ratified the WA. This would avoid a series of short extensions and emergency summits. At the meeting itself, the majority of EU leaders supported this idea but it was opposed by French President Macron. He expressed concerns about the UK blocking EU decisions and progress on his reform agenda, and proposed a short extension until 22 May instead.
The European Council eventually agreed on an extension until 31 October, with the possibility of the UK leaving earlier if the WA is ratified (on the first day of the month after ratification). The European Council Conclusions also included a provision for UK withdrawal on 1 June if it does not hold EP elections, and referred to a review of progress at the European Council meeting on 20-21 June 2019. The Conclusions and the European Council Decision formalising them included reference to the UK commitment to act in a constructive and responsible manner during the extension period in accordance with the duty of “sincere cooperation” and noted that the UK would remain a Member State “with full rights and obligations”, and that it has the right to revoke its Article 50 notification at any time.
The principle of ‘sincere co-operation’ is set out in Article 4(3) of the Treaty on European Union (TEU) which states that the EU and its Member States shall “in full mutual respect, assist each other in carrying out tasks which flow from the Treaties”, and that they shall ensure fulfilment of obligations arising from the Treaties, facilitate the achievement of the EU’s objectives and refrain from any measure which could jeopardise them. Member States have previously been taken to the Court of Justice of the EU (CJEU) for not ‘sincerely cooperating’.
The European Council Conclusions and Decision also refer to an expectation that the UK fulfil its obligation of ‘sincere co-operation’ “in a manner that reflects its situation as a withdrawing Member State”. They state that the UK should “refrain from any measure which could jeopardise the attainment of the Union’s objectives, in particular when participating in the decision-making processes of the Union”.
There is however no legal obligation on the UK as a “withdrawing Member State” to behave in a certain way beyond its normal Treaty obligations, including ‘sincere co-operation”. This wording should therefore be read as a non-legal request that the UK behave ‘nicely’ in light of its impending departure, as well as a legal reminder that it is obliged to cooperate with EU processes as long as it remains a Member State.
The European Council Conclusions also include a reference to the other 27 EU Member States (the EU27) holding meetings without the UK to discuss matters related to the situation in the EU after Brexit. This would be in addition to meetings held under Article 50 TEU to discuss the Brexit process. These are likely to be ‘informal’ meetings where decisions are not taken.
Transition and the future UK-EU relationship
Unless the relevant dates in the WA are amended, a longer Article 50 extension will reduce the duration of the transition/implementation period provided for by the WA. The WA transition period lasts until the end of December 2020, with a possibility of a further extension of one or two years. A UK-EU agreement to further extend the transition would need to be reached by 1 July 2020, eight months after the possible Brexit date of 31 October.
This shortened transition period would also mean less time to negotiate a future agreement governing UK-EU relations, given that the EU has reiterated that these negotiations cannot start until the UK actually leaves the EU.
The European Council Conclusions state that should the UK’s position “evolve”, it might “reconsider” the Political Declaration setting out the framework for the future UK-EU relationship “in accordance with the positions and principles stated in its guidelines and statements, including as regards the territorial scope of the future relationship”. The wording on territorial scope is likely to be a reference to a future EU-UK agreement not applying to Gibraltar without Spain’s consent.
European Parliament elections
On 8 April, the Government made the Order enabling the holding of the EP elections. The deadline for delivery of nomination papers and lists of candidates is 25 April for most UK constituencies. If the UK reaches agreement to leave the EU before 23 May and “exit day” as defined by the EU (Withdrawal) Act 2018 is amended to reflect this agreement, then the legislation allowing EP elections to happen will be repealed and UK participation in the elections will be cancelled.
If UK MEPs are elected on 23 May, they will not take up their seats if both the UK and EU ratify the WA and the UK then leaves the EU prior to 2 July when the new EP sits for the first time.
UK participation in the EP elections means that the envisaged reallocation of UK MEPs may be deferred. EU legislation reallocates 27 of the UK’s MEPs to 14 other Member States. This reallocation will still take place when the UK leaves the EU, meaning that MEPs for these reallocated seats will be ‘elected’ but will remain in limbo – unable to take up their seats until the UK and its MEPs leave.
Practical difficulties in ratifying WA prior to EP election
UK ratification would require House of Commons approval of the WA and the passage in Parliament of the EU (Withdrawal Agreement) Bill by 22 May. There are 17 sitting days from 23 April (when the House of Commons returns from Easter recess) and 22 May, although there could be additional sitting days if the Commons sits on Fridays and possibly even weekends.
EU ratification also requires EP consent. If the UK ratifies the WA in May or June, there could be logistical difficulties in holding the EP consent vote for the WA given that it is not scheduled to sit again until 2 July, and this could delay the date of withdrawal from the EU. However, EU law provides that the outgoing EP remains in office until the new one sits for the first time, and the EP’s rules of procedures allow it to be recalled on an exceptional basis.
Election of Commission President
If UK MEPs do take up their seats, they could potentially only be MEPs for a short period before leaving. The presence of UK MEPs will have an impact on the formation of (and funding allocations) for political groups in the EP, and the election of the EP President.
If there are UK MEPs over the summer, this could also influence the selection process for the next European Commission President. The European Commission President is elected by the European Parliament, following a proposal by the European Council which agrees a candidate by qualified majority, taking into account the results of the EP elections. The presence of UK MEPs will most likely benefit the (currently) second-largest political group in the European Parliament, the Progressive Alliance of Socialists and Democrats. The Labour party belongs to this group. The largest EP group is the European People’s Party. The Conservative party left this group in 2009.
Nomination of UK Commissioner
The term of office of the European Commission expires on 31 October. Once a Commission President is elected, Member States need to put forward their nominations for Commissioners. Nominations face European Parliament hearings in September and then the EP votes to confirm the composition of the Commission in October. It is possible that the UK may still be required to nominate a Commissioner even though it is scheduled to leave the EU by 31 October at the latest. The European Council could agree that the UK does not need to nominate a Commissioner.
The two Article 50 extensions have required that Statutory Instruments be laid by the Government to change “exit day” as defined by the EU (Withdrawal) Act 2018. This can be done under the Act to align it with any new exit date agreed with the EU. Following a Government amendment introduced during the passage of the Cooper Bill, the eventual Act (the European Union (Withdrawal) Act 2019), amended the European Union (Withdrawal) Act 2018 so that any regulations that change “exit day” will no longer require approval by both Houses under the draft affirmative procedure. Instead, the Government may make regulations subject only to annulment by either House. This procedure was followed on 11 April for the extension agreed the previous day.
Documents to download
Brexit delayed again: until 31 October 2019? (469 KB, PDF)
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