LONDON — The British pound lost ground on Wednesday after Members of Parliament voted to extend the Brexit deadline by “at least” three months to June 30 in what has been a week of high drama over how, when — and whether — Britain should leave the European Union.
The pound slipped to $1.32 from $1.33 following a series of votes in the early evening, the most important of which dealt with extending the March 29 Brexit deadline. MPs voted 412 to 202 in favor of a delay and it is now up to Prime Minister Theresa May to ask EU leaders for more time.
All 27 states in the EU must agree to an extension, but European leaders have already made it clear that they want the delay to be short, sweet and packaged up with a Parliament-endorsed deal that will see Britain exit the EU in an orderly fashion.
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If MPs approve May’s Brexit deal — the same deal they rejected twice already — by March 20, the extension will last three months until June 30. If that deal is not approved, then Britain will have to renegotiate with the EU to buy more time.
May herself has said that if her deal is not passed, Britain will be at the mercy of the EU and an extension will need to be much longer than three months, which would cause even more insecurity and confusion among businesses, consumers and the general public.
The EU could well seek a delay to Brexit until 2021, according to some media reports. May has said that “a short, technical extension” is only likely to be on offer if Britain has a deal in place.
With regard to an extension, French president Emmanuel Macron has already said that Britain would need to justify why it needs the extra time. He also reiterated that the EU would not renegotiate May’s withdrawal agreement.
If parliamentarians do not vote for May’s deal by March 20, she will then give them the chance to vote on how they want to proceed with Brexit. That could mean yet another vote on a second referendum.
In addition, if May’s Brexit plan is rejected for a third time, the country will have to take part in European Parliament elections, which are set for late May.
Thursday’s Brexit delay vote was the last in a three-day marathon of ballot-casting as MPs tried to seek a consensus on Britain’s exit from the EU. The voting started on Tuesday when MPs shot down May’s Brexit withdrawal agreement for the second time.
They still couldn’t swallow the “backstop” compromise on the Irish border, which would see the EU ultimately deciding Britain’s role in the single market if a future trade deal between the EU and Britain fails to materialize.
Then, on Wednesday evening, MPs torpedoed a “no-deal Brexit,” a decision that came as a relief to many and a disappointment to others who would argue that a “no-deal” exit was the last bargaining chip that Britain held in its negotiations with the EU.