Brexit Bulletin: What’s Changed in 10 Years

  • Bank of England raises interest rates for first time since 2007
  • May under further pressure over choice of new defense secretary
Ex-U.K. Deputy PM Clegg Calls for Brexit to be Stopped

Sign up to receive the Brexit Bulletin in your inbox, and follow @Brexit on Twitter.

How things have changed in Britain over the past 10 years.

In July 2007,  Tony Blair, the U.K.’s  most pro-European Union prime minister in a generation, had just stepped aside. The iPhone had just come out—the original iPhone. A ban on smoking in pubs, restaurants and other public spaces entered into force that month. And, until Thursday, it was the last time the Bank of England had raised interest rates.

A decade on, as Blair sits outside mainstream politics and lobbies against Britain’s departure from the European Union, the bank’s governor, Mark Carney, underscored the impact of Brexit on the U.K. economy as the bank raised interest rates for the first time in a decade. In fact, he tied the next interest-rate shift to the success of the negotiations, saying Britain’s withdrawal was the main risk to the country’s economic outlook.

Tony Blair leaves Downing Street in 2007.
Photographer: Daniel Berehulak/Getty Images

Compared with the landslide he won when he entered office, Blair’s 65-seat majority at the time he stood down in 2007 was considered fairly slim. What May would give for that now.

As it is, she’s leading a minority government propped up by Northern Ireland’s Democratic Unionist Party.

On Thursday, Gavin Williamson, who as chief whip did much of the leg work sealing the DUP deal for May after the general election, was parachuted in as defense secretary, replacing Michael Fallon, who quit earlier this week amid the sexual harassment scandal enveloping Westminster.

Williamson’s appointment won’t change the delicate Brexit balance within the cabinet—he backed Remain in last year’s referendum—but it has raised fresh questions about May’s judgment. The appointment of an inexperienced May loyalist was met with anger from lawmakers in her own party, who warned that she wouldn’t survive any further attempts to topple her, the Times reports.  The repercussions for the EU negotiations are obvious.

The U.K. lurches from crisis to crisis, was how Bloomberg described it on Thursday. It’s hardly ideal with Brexit talks due to resume in Brussels next week and with a crunch summit of EU leaders in just six weeks’ time.

Brexit Latest

For Our Eyes Only | The U.K. government is preparing to show a panel of lawmakers secret papers detailing the economic impact of Brexit but wants to keep the information out of the public gaze. Theresa May’s team is working on how to disclose the documents after Parliament passed a motion calling on the government to release internal research.

Under the Influence | Britain’s elections regulator is looking at whether Russia tried to use social media to illegally sway the Brexit referendum campaign. The regulator wants Facebook and Twitter to reveal who paid for advertising.

Berlin’s Bill | Brexit could end up costing Germany an extra 5 billion euros in EU budget contributions, according to the newspaper Bild. The newspaper quotes the country’s court of auditors as saying the German government could be forced to increase its payments from 14.3 billion if the U.K. refuses to pay its share of liabilities.

Car Lending | Volkswagen is preparing to apply for a U.K. banking license so it can carry on providing finance to motorists after Britain leaves the EU, the Financial Times reports.

Carry on Working | Brexit Secretary David Davis said he has spoken to the European Parliament’s Guy Verhofstadt about creating “associate citizenship” that could allow visa-free working rights to British nationals in the EU after Brexit.

Their Man in Brussels | France named Philippe Leglise-Costa, currently head of the country’s European affairs directorate, as the country’s new ambassador to the EU. He was former President Francois Hollande’s European affairs adviser between 2012 and 2017. Starting Nov. 20, he’ll be one of France’s key diplomats overseeing its stance during Brexit talks.

Staying Relevant | Mayor of London Sadiq Khan has announced a new program of investment days for London startups, as he tries to maintain the U.K.’s position as a European hub for young tech companies.

And Finally...

Depressed by the apparent stalemate in the Brexit negotiations?

Cheer yourself up with a photo of European Commission President Jean-Claude Juncker, taken on Thursday as he got an honorary degree in Portugal.

Juncker, who plays a crucial role in the Brexit negotiations and met May for dinner last month before the EU summit, picked up the award at Coimbra University.

European Commission president Jean Claude Juncker is awarded an honorary degree during a ceremony at the Sala dos Capelos at Coimbra University in Coimbra this week.
Photographer: Bruno Pires/AFP via Getty Images

For more on Brexit follow Bloomberg on Twitter, Facebook and Instagram

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE