Brexit Betting: Was this latest humiliation Theresa May's last stand?

UK Prime Minister Theresa May
The crisis around Theresa May's leadership have hit a new peak

Brexit is deadlocked and the turmoil in UK politics is escalating after another resounding defeat for Theresa May's Brexit deal. Paul Krishnamurty analyses what happens next...

"When analysing Theresa May's exit date over the last year, this moment has been paramount...when she is seen, unarguably, to have failed and becomes no longer useful to any faction of her party."

Back Theresa May Exit Date to be Apr-Jun 2019 @ 4.216/5

For a strange, brief moment yesterday, amid predictable hype of a last minute gamechanger in Theresa May's Brexit negotiations, a serious gamble on Theresa May's EU Withdrawal Agreement passing gained momentum.

As it turned out, the PM's late dash was in vain, and very little had changed. She fared better than the first vote, but was still handed the third biggest defeat in parliamentary history, by a margin of 149.

Brexit on verge of stalling ahead of key votes

What next? Parliament will attempt again to take control of the Brexit pass over the next few days. First, there will be a free vote on a motion to block No Deal - rated 95% likely to pass on Betfair's market at odds of 1.041/25.

A more competitive heat involves How Many MPs will Vote Aye. 400 or more is trading around 1.75/7. I took 3.02/1 earlier and will be going in again if it returns above 2.01/1. Given that May has granted a free vote to her MPs, I doubt there will be 250 on the other side.

Then, on Thursday, MPs will vote on another motion to extend Article 50. As it stands the government are prepared to ask the EU to extend until May 24th - allowing the UK to avoid participating in the European Elections.

New Brexit date revolves around Euro elections

The Brexit betting now centres around that latter date - leaving on 29/03/19 is now rated merely 14% likely at 7.26/1. April-June is hot favourite in our tri-monthly market at 2.68/5.

In this highly uncertain situation, those odds are plenty short enough. MPs could well pass amendments extending the extension date or even kicking it into the long grass. Or not. Everything is still in the mix, including outcomes that had been widely written off.

Beyond these imminent motions, the next big question involves those Euro elections. As ever, everything is changeable and we are guessing about whom to believe - the Mirror or the Tory chairman?

If we do participate, literally all bets are off. Never mind the ramifications of a much longer Brexit process, those elections would be incredibly divisive, potentially transforming the party system. Never mind TIG, Nigel Farage's Brexit Party are waiting in the wings.

If not, as explained last week, No Deal becomes likelier than ever, albeit slightly delayed. The cliff edge will merely move forward a few weeks, but without an escape route. Staying in, without representation in the EU Parliament, is simply not political reality.

Therefore, MPs will need to do more to prevent No Deal and merely call for a longer A50 extension or a toxic revocation. To get the EU to agree, they will need to signal a clear new direction. Either a general election or a second referendum. Although there is an alternative cross-party deal to be done, the least that would require is a different PM.

The PM will struggle to survive many more weeks

The Conservative Party is more divided than ever this morning. Last night really felt like the end of May. Shorn of all authority and credibility - exacerbated by losing her voice - the PM was unable to marshall much support beyond the government payroll. We have, of course, said that before and she remains safe from a direct leadership challenge until December.

When analysing her exit date over the last year, this moment has been paramount in my mind. The moment when she is seen, unarguably, to have failed and becomes no longer useful to any faction of her party.

I think her exit is imminent and expect a market move to that effect. 8.27/1 is available about Jan-Mar 2019 but the next band, Apr-Jun, is preferred at 4.216/5. That covers several weeks of inevitably constant speculation and even allows her to stay in post for a short transition while the party picks a new leader.

All eyes are on the Cabinet, who hold her fate in their hands. Either they move against her, or parliament could do so via a No Confidence vote.

Tory backbencher Charles Walker said he would back one to spark a general election. His point that a PM losing control of parliament to backbenchers is untenable is a good one, and this is a useful threat.

If that were to materialise - a 2019 General Election is available to back at 2.588/5 - virtually no Tory wants May to lead it. The Sunday Times report that several leadership campaigns are ready to go.

My instinct remains that an election is likelier than a second referendum in 2019 - that too is shortening again, into 3.211/5. Whereas the latter would be an existential threat to the Tory party, the former would produce a big majority if the latest Kantar poll is to believed.

Whether the Tories can sustain a 10% lead once the reality of any extension - let alone a lengthy one and Euro elections - hits home with Brexit voters is highly questionable. Nevertheless, if MPs successfully amend the A50 extension vote, both could quickly become inevitable. If so, one way or another, the question will end being thrown back to the people.

Bet on UK politics here

Theresa May Exit Date
UK to leave EU by 29/03/2019?
Brexit Date
No Deal Motion To Pass?
How Many MPs Will Vote Aye On No Deal Motion?
EU Referendum before 2020?
Year of Next Election

Follow Paul on Twitter and check out his website, Political Gambler.

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