Q: An emergency budget?
I’ve got an important job to do. I respect the decision of the referendum. The result will have an impact on public finances, but we will have to wait until we have a new prime minister.
He dodges another question about whether he will resign.
Third challenge:
Long-term trading relationship with European neighbours: I am completely focused on bring stability and certainty. We start from a position of hard-won strength.
Second challenge:
Uncertainty: we should only trigger article 50 when a plan is in place. Some firms are pausing their decisions to invest and hire people. The delay in triggering article 50 will help.
“We are open for business”, Osborne said.
Osborne said there are three challenges:
Volatility: contingency plans have been put in place. “Swap lines” have been put in place. Mark Carney’s statement on Friday was part of the plan. The governor and I have been in regular touch or the weekend.
It will not be plain sailing in the days ahead, Osborne admits.
Thank goodness we fixed the roof, while we could, Osborne said. Leaving the EU was not the outcome that I wanted or campaigned for, but now that democracy has spoken we must act on that result. I will fully respect that result.
The economy will have to adjust.
“Britain is ready to confront whatever the future holds for us,” Osborne insists.
The chancellor is about to stand up at the Treasury in London in his attempt to reassure the markets.
Japan’s stock market put on a show of resilience, writes Justin McCurry from Tokyo:
The Nikkei 225 rose more than 2% by early afternoon as prime minister Shinzo Abe held an emergency meeting early on Monday and instructed the Bank of Japan to do all it could to stabilise financial markets.
“Uncertainty and risk concerns remain in financial markets. It is important to continue to try to stabilise markets,” Kyodo News quoted Abe as saying at the meeting, held just before the Nikkei opened.
China – whose markets largely rode out the start to the week – warned that its companies might want to “wait and see” what the impact is of the Brexit vote before they invest in the country.
The pound, which suffered record falls against the dollar in the aftermath of the EU referendum result, continued to drop on Monday. Sterling fell 2.4% to US$1.3388, still some distance from the 31-year low of $US1.3228 it reached on Friday.
Tokyo’s Nikkei 225 had risen more than 2% – or more than 300 points – by early afternoon, rebounding at least temporarily from Friday’s 7.9% loss, its biggest since the 2008 global financial crisis.
The Shanghai Composite gained 0.6% to reach 2,870.92 in early morning trading, and Sydney’s S&P ASX200 added 0.5% to 5,136.80.
Other markets in the region fell, however, days after a worldwide plunge wiped out $2.1tn of value from global markets.
Hong Kong’s Hang Seng shed 0.7% to 20,112.35 and Seoul’s Kospi lost 0.1% to 1,923.13. Benchmarks in Singapore, the Philippines and Indonesia also fell.
You can follow George Osborne’s speech – due to start in about 15 minutes’ time – here, of course, but also keep an eye on tweets from our political editor, Heather Stewart, who’s at the Treasury this morning:
On my way to Treasury to hear reassuring words from George Osborne, the man who warned us Brexit would unleash economic catastrophe.
— Heather Stewart (@GuardianHeather) June 27, 2016
Happy Monday and with the aftermath of last week’s vote to leave the EU showing no signs of tiring, welcome to another day of Brexit liveblogging.
The morning briefing rounds up what you need to know to start the day, before the live blog takes you through it all happening, along with all the extras we didn’t expect. Do come and chat in the comments below or find me on Twitter @Claire_Phipps.
It’s an early morning for the chancellor, George Osborne, who breaks his post-vote (mostly) silence to issue a dawn statement intended to calm the markets and set out his plans to stabilise the economy and the surrounding jitters. Don’t bank on hearing mention of that £30bn black hole budget this morning. Instead, a Treasury spokesman said:
The chancellor will make a statement to provide reassurance about financial and economic stability in light of the referendum result and the actions that he and the rest of the government will be taking to protect the national interest over the coming period.
The City might be hoping for a large dollop of reassurance on its breakfast muesli, with news that some firms are preparing to leave the UK amid uncertainty over the post-Brexit financial landscape. The Guardian reports this morning:
A survey by the Institute of Directors (IoD), which found that the majority of businesses believed Brexit was bad for them, comes amid fears that investors will wipe billions more pounds off share values on Monday morning, and signs that the pound, which hit a 30-year low on Friday, was coming under further pressure from trading in Asia. Sterling was down more than 1% as the Asian markets opened late on Sunday.
The IoD said a quarter of the members polled in a survey were putting hiring plans on hold, while 5% said they were set to make workers redundant. Nearly two-thirds of those polled said the outcome of the referendum was negative for their business. One in five respondents, out of a poll of more than 1,000 business leaders, were considering moving some of their operations outside of the UK.
The European Central Bank’s annual summit begins in Portugal today, but it’s now thought the Bank of England governor, Mark Carney, might skip it, due to worries about expected turmoil in the markets today.
Officials in Japan and China have already issued warnings today as the pound continued to fall and Asian markets struggled to recoup heavy losses.
Ahead of the start of a two-day Brussels summit tomorrow – to which David Cameron is still invited but which he will leave early to allow the 27 other leaders to talk about him without him having to pretend he can’t hear them – the European council president, Donald Tusk, today meets Angela Merkel, François Hollande and Matteo Renzi, and the US secretary of state, John Kerry, heads Europe-wards too. The likely agenda? Can EU leaders push Britain into the process of negotiating its exit by refusing informal talks ahead of the official triggering of article 50? What if the UK never gets round to triggering article 50? Will Iceland boot England out of Europe quicker than expected?
The Times front page today reports that Osborne’s purdah has also been spent mulling whether to back Boris Johnson to succeed Cameron as prime minister, as the Vote Leave frontman – and home secretary Theresa May – look set to launch bids for the keys to No 10 this week.
But an ally of the chancellor told the Guardian:
No he hasn’t made any decisions at all – he has been totally focused over the last 72 hours on talking to counterparts and investors across the world to try to ensure a period of stability.
Johnson, it seems, has spent at least some of those 72 hours penning what is presumably his first draft at a prime ministerial manifesto for his regular Telegraph column (so handy and time-saving to be able to multitask!). Those who voted to remain aren’t a bad lot, he declares:
They are our neighbours, brothers and sisters who did what they passionately believe was right … We who are part of this narrow majority must do everything we can to reassure the remainers. We must reach out, we must heal, we must build bridges – because it is clear that some have feelings of dismay, and of loss, and confusion.
Dismay, loss and confusion: not a bad summing-up of where Labour finds itself on Monday morning, reeling from 11 shadow cabinet resignations – and one sacking – over the weekend, and with the threat of more to follow today. Here’s the latest standings on who’s in and who’s out. Make sure your F5 button is working today.
An embattled Jeremy Corbyn will hold talks today with Tom Watson – still scraping the mud off his Glastonbury wellies – after the deputy leader pointedly omitted to back Corbyn yesterday. Watson issued a statement saying he was “deeply disappointed” by the sacking of Hilary Benn and “equally saddened” by the resignations that followed:
The nation needs an effective opposition, particularly as the current leadership of the country is so lamentable. It’s very clear to me that we are heading for an early general election and the Labour party must be ready to form a government. There’s much work to do.
Pressure on the Labour leader has grown, with the latest voice to chime in belonging to Phil Wilson, who chaired the Labour In For Britain parliamentary group. Writing in the Guardian, Wilson says:
It was clear last summer that Jeremy was only ever partially interested in keeping Britain in Europe and an honourable leader would bear the responsibility for the failure to persuade Labour voters to vote remain.
Corbyn has made it clear that there will be no Jexit for him (sorry, I didn’t start that one):
I was elected by hundreds of thousands of Labour party members and supporters with an overwhelming mandate for a different kind of politics.
I regret there have been resignations today from my shadow cabinet. But I am not going to betray the trust of those who voted for me – or the millions of supporters across the country who need Labour to represent them. Those who want to change Labour’s leadership will have to stand in a democratic election, in which I will be a candidate.
Corbyn said he would announce a new top team “over the next 24 hours” – but many observers expect more resignation letters to come fluttering on to his mat before then. He also has a meeting of the parliamentary Labour party to look forward to at 6pm.
Confusion is abounding elsewhere too. For example, here’s prominent Brexit campaigner Iain Duncan Smith in front of a Vote Leave bus linking the £350m in EU “savings” to more money for the NHS:
And yet here too is Iain Duncan Smith telling the BBC on Sunday:
I never said that during the course of the election … What we actually said was a significant amount of it would go to the NHS. It’s essentially down to the government, but I believe that is what was pledged and that’s what should happen. There was talk about it going to the NHS, but there are other bits and pieces like agriculture, which is part of the process. That is the divide up. It was never the total.
It’s not the only pledge that leave campaigners have inched back from since Thursday. Perhaps some things really are politics as usual.
You should also know:
Bagehot in the Economist says “a vacuum yawns wide” at the top of British politics:
Mr Cameron has said nothing since Friday morning. George Osborne, the chancellor of the exchequer, has been silent … The prime minister’s loyalist allies in Westminster and in the media are largely mute.
Apart from ashen-faced, mumbled statements from the Vote Leave headquarters on Friday, Boris Johnson and Michael Gove have also ducked the limelight … Neither seems to have the foggiest as to what should happen next. Today Mr Gove’s wife committed to Facebook the hope that ‘clever people’ might offer to ‘lend their advice and expertise’. And Mr Johnson’s sister, Rachel, tweeted: ‘Everyone keeps saying “we are where we are” but nobody seems to have the slightest clue where that is.’
In Politico, Tom McTague and Alex Spence rate the chances of the six different ways Britain might just stay in the EU:
Could the UK negotiate ‘associate status’, outside the EU but with devolved powers for Scotland to maintain free movement and other EU benefits? … The ‘associate’ option, which would be decried as a sell out by hardline Brexiters, would see the future prime minister try to keep Britain in the EU single market, accepting large tracts of EU law, but with autonomy over agriculture, fishing and trade deals …
[Nicola] Sturgeon is key to making this happen. If she can go back to Edinburgh claiming victory – protecting Scotland’s access to the single market and getting back fishing rights – the UK could be saved. But the UK as a whole would lose its seat at the EU table and be firmly more Out than In. It would be powerless, but sovereign. It is a hard sell in the long term.
And Zoe Williams – a Corbyn supporter – writes in the Guardian that it is time for Labour to move on:
I don’t agree that his time as leader has been a disaster – leave would have won the referendum regardless. It would always have turned the debate into a conversation about immigration and hammered out its racist cant, whoever opposed it. A more centrist Labour leader would have made more concessions – offered bogus and unworkable migrant caps – but the more strident voice would still have won.
Corbyn has been a one-man Occupy movement, squatting in the office of Labour leader on behalf of the people (of whom I was one) who felt the party’s high command was lifeless and intellectually spent. The point has been made, and the apparatus now has to be put to better use.
I think we’ve gone past baffling, really, so suggestions for a new title are very welcome. Anyway, here’s Sky News political editor Faisal Islam revealing that a prominent leave campaigner had told him there was no post-Brexit plan.
"It sounds like I’m making that up" - @FaisalIslam told the Leave campaign did not have a post #Brexit plan https://t.co/VY6ATlAowP
— Sky News (@SkyNews) June 26, 2016
It would be Guess Who? If you’ve got blue eyes and are wearing a hat, you could be in the shadow cabinet by tea-time.
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