Government loses finance vote for first time in 40 years as no-deal fears grow
Theresa May is facing opposition from all sides over her deal to leave the EU
Senior Conservatives vowed last night to fight a guerrilla campaign to stop a “disastrous” no-deal Brexit after inflicting the first Commons defeat on a government finance bill in more than 40 years.
Twenty Tory MPs, including seven former cabinet ministers, broke a three-line whip to restrict the Treasury’s powers to prepare for leaving the European Union without a deal in March.
The rebels, who included the former defence secretary Sir Michael Fallon and the former Cabinet Office minister Sir Oliver Letwin, warned that they would continue to sabotage all no-deal Brexit legislation until Theresa May ruled out the option.
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“I want to make it abundantly clear that a majority in this house will not allow a no-deal exit to occur at the end of March,” Sir Oliver told MPs.
Significantly, the Tory rebellion brought together the supporters of a second referendum and former Remainers who now back Mrs May’s deal or a Norway-style soft Brexit.
They said that they would amend all government Brexit legislation until March to try to make a no-deal departure from the EU impossible. “I will vote on any motion, on any amendment, on any piece of legislation, proposed by whomsoever in this house, to ensure that we leave the EU on 29 March with a deal or not at all,” the former minister Nick Boles said.
The amendment, which would deny the Treasury powers to change taxes without parliamentary approval after a chaotic departure from the EU, was passed by a majority of seven.
It is the first time since May 1978 that a government has lost a vote on a finance bill. On that occasion James Callaghan’s Labour government lost three votes in three days, including Conservative amendments to reduce the basic rate of income tax and to raise the threshold for the higher rate.
Brexiteers accused ministers of deliberately allowing the vote on a “trivial amendment” to “advertise weakness” and pressurise them to support Mrs May’s deal. Jacob Rees-Mogg warned that his group of Leave-backing MPs intended to continue to oppose the withdrawal agreement.
MPs restart the debate on Mrs May’s Brexit divorce deal again this afternoon, with a vote scheduled for Tuesday. The prime minister acknowledged for the first time in cabinet yesterday that she may lose this vote and pledged to “move quickly” in the event of defeat.
Other cabinet ministers called for the government to rule out a no-deal. One source said that Amber Rudd, the work and pensions secretary, had told Mrs May: “History will take a dim view of a cabinet that presses ahead with no-deal. We have to face the world in which we find it, not as we wish it to be and we have to deal with the facts as we find them.” Sajid Javid, the home secretary, also opposed a no-deal Brexit.
Sir Oliver, who was in charge of emergency preparedness under David Cameron, said that he would vote against the government until no-deal was taken off the table, warning that anyone who claimed that such a departure would be smooth was “deluded”.
The defeat came after Mrs May met a cross-party group of MPs who wrote to her this week calling for her to rule out a no-deal. Senior sources in London and Brussels said that they expected Mrs May to return to the EU if she lost the vote next week and appeal for more concessions.