UK Politics: Is a second Brexit referendum now likely?

The 2016 referendum voting slip - will Britons soon be back at the polling stations?
Join today View market

The economic reality of Brexit is starting to bite and experts are lining up to say that a second referendum is on the cards. But what do the betting odds tell us? Max Liu discusses the latest news and market moves.

"Parliament is likely to be unable to agree on whatever deal UK negotiators bring back from Brussels - this is one reason why you can get [1.79] on no Brexit by 2022."

Week by week the possibility of no Brexit increases. One month ago, British and German business leaders warned that leaving the single market would have terrible consequences for the UK.

Last week, Mayor of London Sadiq Khan said the decision to leave the EU could be reversed. This week, Professor Vernon Bogdanor, a government expert, or David Cameron's former-politics teacher if you like, said a second in-out referendum is becoming more likely by the day.

But what do the people think? If the betting markets are any guide then it's increasingly difficult to say, which probably reflects wider uncertainty about Brexit. It's [5.3] that there will be a second referendum before 2019, so on that basis bettors appear to believe that Britain is heading for the exit.

On the other hand, the UK is [1.5] to still be in the European Union by March 29 2019 - the supposed deadline for leaving, after Article 50 was triggered on the same date this year.

Bogdanor believes some British politicians suffer from an "imperial reflex" which means they overestimate Britain's importance in the world. Hard to disagree with that, when you remember the confidence with which, only a year ago, pro-Brexit politicians like David Davis and Daniel Hannan talked about Britain being able to leave the EU and get exactly what it wanted from the divorce settlement.

That seems a long time ago now and reality is starting to bight, with Bank of England governor Mark Carney this week cutting Britain's economic growth forecasts due to uncertainty about Brexit.

It's become commonplace, since June 9, to say: "The election changed everything." By this, it's implied that Theresa May failed to gain the large majority that would have made possible her "red, white and blue Brexit" and that there is now probably not a majority in Parliament for a hard Brexit, even if Labour do appear to be playing a strange game and currently going along with the Tories' version of Brexit.

Parliament is likely to be unable to agree on whatever deal UK negotiators bring back from Brussels - this is one reason why you can get [1.79] on no Brexit by 2022 in Betfair's burgeoning Brexit Date market. But even if a Brexit deal could get through Parliament, it would arguably face even more opposition in the House of Lords. The only solution then could be to give the people the final say in a second referendum. They are, after all, the ones who get themselves into this mess.

Cable says young have been "shafted" by Brexit

If the second referendum does take place then there's no saying yet what the outcome would be. As a betting event, it would potentially be even more unpredictable than the 2016 version. YouGov recently published some mind boggling polling on the matter which showed 61% of Leave voters saying they were prepared to take a financial hit to secure Brexit.

To be clear - the 61% believe serious damage to the UK economy is a price worth paying for Brexit. Put like that, it sounds remarkable. But does it actually mean these Leave voters are willing to be worse off for the sake of Brexit? Not necessarily, as only 39% said they'd be prepared to be personally poorer for Brexit.

With these figures in mind, new Liberal Democrat leader Vince Cable hit out this weekend at the elderly "Brexit martyrs" who, he believes, have made life more difficult for younger Britons. This is the type of intervention that, Cable hopes, will persuade Remain supporters to vote for the Lib Dems at the next general election.

The odds on that election happening this year have drifted to [11.0], although bettors make a 2018 election [3.45].

Join today View market
More UK Politics