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Brexit live: Osborne tries to calm markets as Labour coup continues
Brexit live: Osborne tries to calm markets as Labour coup continues
(35 minutes later)
8.34am BST
08:34
Graeme Wearden
It looks like Osborne has managed to calm the markets, a bit. The FTSE 100 is down just 20 points right now (-0.37%).
There’s more here on our business live blog.
8.32am BST
08:32
New shadow cabinet
Jeremy Corbyn has replaced 10 of the shadow ministers who resigned (or were sacked in Hilary Benn’s case).
The reshuffle involves moving Emily Thornberry from shadow defence minister to shadow foreign secretary, and replacing her with the new MP for Norwich South Clive Lewis.
Diane Abbott is also promoted to shadow health secretary.
Here’s the full list:
8.25am BST
08:25
Back to Osborne. Here’s the full text of his response to questions about whether there will an emergency Brexit budget as he had threatened.
There will have be action to deal with the impact on the public finances, but of course it is perfectly sensible to wait until we have a new prime minister. Of course the economy is going to adjust, and there will be an impact on the public finances, that’s what I said before the referendum, I don’t resile from anything I said before the referendum. And I said there would have to be action, actually as it happens in the autumn, to address that. I think it is perfectly sensible to wait until we have new prime minister before we address that.
And asked whether he could serve in a government committed to leaving the EU, Osborne said: “It is my country right or wrong. And intend to fulfil my responsibilities to the country.”
8.12am BST
08:12
The shadow housing housing minister, Roberta Blackman-Woods, is threatening to resign if Corbyn doesn’t step down.
“It is time for another leadership election. It is time for him to go”, she told BBC Newcastle.
3/3 The City of Durham MP added that she will resign from the frontbench today if Mr Corbyn does not step down as leader.
Updated
at 8.21am BST
8.08am BST
08:08
Ian Murray, until yesterday the shadow Scottish secretary, has been explaining his resignation from Jeremy Corbyn’s cabinet on BBC Radio Scotland’s Good Morning Scotland programme.
Insisting that there was “no choreography” to Sunday’s slew of resignations – a delegation was planning to see Corbyn this morning but that was superseded by Hilary Benn’s sacking – Murray said that “I don’t think that Jeremy had his heart and soul in the campaign.
“We haven’t reached out to traditional Labour voters, we haven’t taken on some of the concerns that people had about immigration that were wrong, the campaign was lacklustre and the response since has not been robust enough.”
He asked Labour party members who supported Corbyn in the last leadership election to understand the current political crisis was “bigger than one person, bigger than the Labour party”.
“We’re talking to too narrow a group of people in a comfort zone that means we are not a credible party of government.”
Updated
at 8.22am BST
8.06am BST
08:06
Another few minutes goes by and Corbyn is hit by another resignation in his junior ranks. This time it’s Stephen Kinnock as parliamentary private secretary to Angela Eagle.
It is with regret that this morning I have resigned as a PPS pic.twitter.com/0KFG1bhRaD
Updated
at 8.22am BST
7.57am BST
7.57am BST
07:57
07:57
Corbyn hit by more resignations
Corbyn hit by more resignations
There have further resignations in the junior levels of Labour’s front bench team.
There have further resignations in the junior levels of Labour’s frontbench team.
Toby Perkins has resigned as shadow armed forces minister saying that the Labour Party “needs a change at the top”.
Toby Perkins has resigned as shadow armed forces minister, saying that the Labour party “needs a change at the top”.
Diana Johnson has resigned as a shadow foreign minister and Anna Turley as shadow minister for civil society.
Diana Johnson has resigned as a shadow foreign minister and Anna Turley as shadow minister for civil society.
#Breaking Toby Perkins resigns as shadow armed forces minister, saying Labour "needs a change at the top" pic.twitter.com/D7LBys35pX
#Breaking Toby Perkins resigns as shadow armed forces minister, saying Labour "needs a change at the top" pic.twitter.com/D7LBys35pX
Updated
Updated
at 7.59am BST
at 8.23am BST
7.53am BST
7.53am BST
07:53
07:53
Osborne closed his statement by signalling that he intends to play an “active part” in the debate about Britain’s role in Europe after the referendum. He also suggested he’ll make a statement on whether he plans to run for PM in the coming days.
Osborne closed his statement by signalling that he intends to play an “active part” in the debate about Britain’s role in Europe after the referendum. He also suggested he’ll make a statement on whether he plans to run for PM in the coming days.
He said:
He said:
The third and final challenge I spoke of, was that of ensuring, that Britain was able to agree a long-term economic relationship with the rest of the Europe, that provided the best possible terms of trade in goods and services. Together my colleagues in the government in the Conservative party and in parliament, will have to determine what those terms should be, and will have to negotiate with our European friends and allies to agree them. I intend to play an active part in that debate, for I want this great trading nation of ours to put in place the strongest possible economic links with our European neighbours ...
The third and final challenge I spoke of, was that of ensuring, that Britain was able to agree a long-term economic relationship with the rest of the Europe, that provided the best possible terms of trade in goods and services. Together my colleagues in the government in the Conservative party and in parliament, will have to determine what those terms should be, and will have to negotiate with our European friends and allies to agree them. I intend to play an active part in that debate, for I want this great trading nation of ours to put in place the strongest possible economic links with our European neighbours ...
I do not want Britain to turn its back on Europe or on the rest of the world. We must bring unity of spirit and purpose and condemn hatred and division wherever we see it. Britain is an open and tolerant country and I will fight with everything have to keep it so. Today I am completely focused on the task in hand as chancellor of the exchequer to bring stability and reassurance. There have been questions about the future of the Conservative party and I will address my role within that in the coming days. The British people have given us their instructions, there is much to do to make it work. We start from a position of hard-won strength, and whatever the undoubted challenges my colleagues and I are determined to do the best for Britain.
I do not want Britain to turn its back on Europe or on the rest of the world. We must bring unity of spirit and purpose and condemn hatred and division wherever we see it. Britain is an open and tolerant country and I will fight with everything have to keep it so. Today I am completely focused on the task in hand as chancellor of the exchequer to bring stability and reassurance. There have been questions about the future of the Conservative party and I will address my role within that in the coming days. The British people have given us their instructions, there is much to do to make it work. We start from a position of hard-won strength, and whatever the undoubted challenges my colleagues and I are determined to do the best for Britain.
7.40am BST
7.40am BST
07:40
07:40
The general message from Osborne’s statement was that he warned there would be problems, but by playing for time we can cope.
The general message from Osborne’s statement was that he warned there would be problems, but by playing for time we can cope.
Here’s a key passage from the statement:
Here’s a key passage from the statement:
As a result of Thursday’s decision, some firms are continuing to pause their decision to invest or to hire people. As I said before the referendum this will have an impact on the economy and the public finances, and there will need to be action to address that. Given the delay in triggering article 50 and the prime minister’s decision to hand over to a successor, it is sensible, that decisions on what that action should consist of, wait for the OBR [Office for Budget Responsibility] to assess the economy in the autumn, and for the new prime to be in place. But no one should doubt are resolve to maintain the fiscal stability we have delivered for this country. The British economy is fundamentally strong, we are highly competitive and we are open for business.
As a result of Thursday’s decision, some firms are continuing to pause their decision to invest or to hire people. As I said before the referendum this will have an impact on the economy and the public finances, and there will need to be action to address that. Given the delay in triggering article 50 and the prime minister’s decision to hand over to a successor, it is sensible, that decisions on what that action should consist of, wait for the OBR [Office for Budget Responsibility] to assess the economy in the autumn, and for the new prime minister to be in place. But no one should doubt our resolve to maintain the fiscal stability we have delivered for this country. The British economy is fundamentally strong, we are highly competitive and we are open for business.
Updated
Updated
at 7.42am BST
at 8.24am BST
7.36am BST
7.36am BST
07:36
07:36
Graeme Wearden
Graeme Wearden
The pound has recovered some of its early losses following Osborne’s statement, but is still down against the US dollar.
The pound has recovered some of its early losses following Osborne’s statement, but is still down against the US dollar. It is now trading around $1.345, a fall of 1.7% this morning.
It is now trading around $1.345, a fall of 1.7% this morning.
Sterling had fallen to $1.339 before the chancellor spoke, down from $1.36 on Friday night.
It had fallen to $1.339 before the chancellor spoke, down from $1.36 on Friday night.
Updated
at 8.25am BST
7.30am BST
7.30am BST
07:30
07:30
Here’s some instant reaction to Osborne’s statement:
Here’s some instant reaction to Osborne’s statement:
Shorter Osborne: look I said this was going to hurt, I was right. Financial system is sound but this is still going to hurt.
Shorter Osborne: look I said this was going to hurt, I was right. Financial system is sound but this is still going to hurt.
Osborne's upbeat 7am statement one of his better performances: first officer arrives on bridge of SS Titanic while Boris pleads with iceberg
Osborne's upbeat 7am statement one of his better performances: first officer arrives on bridge of SS Titanic while Boris pleads with iceberg
My translation of Osborne's statement: "I'm off to be Foreign Secretary. One of my colleagues who backed Leave can have my job. Good luck."
My translation of Osborne's statement: "I'm off to be Foreign Secretary. One of my colleagues who backed Leave can have my job. Good luck."
7.27am BST
7.27am BST
07:27
07:27
Osborne: The fundamentals are strong, we have dealt with the immediate impact because of the contingency plan. Britain is open for business. And with that he’s back off to work.
Osborne: the fundamentals are strong, we have dealt with the immediate impact because of the contingency plan. Britain is open for business. And with that he’s back off to work.
Updated
at 8.25am BST
7.25am BST
7.25am BST
07:25
07:25
Osborne: I said there would have to be action to adjust, in the autumn as it happens.
Osborne: I said there would have to be action to adjust, in the autumn as it happens.
Q: Are we at the start of a recession? I made predictions and warnings, but all will require adjustment. I will make very hard to mitigate the impact.
Q: Are we at the start of a recession? I made predictions and warnings, but all will require adjustment. I will make very hard to mitigate the impact.
On his future. It is my country right and wrong and I intend to fulfil my duty to the country.
On his future. It is my country right and wrong and I intend to fulfil my duty to the country.
7.22am BST
07:22
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.
7.20am BST
07:20
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.
Updated
at 7.22am BST
7.19am BST
07:19
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.
Updated
at 7.22am BST
7.17am BST
07:17
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.
7.14am BST
07:14
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.
Updated
at 7.22am BST
7.13am BST
07:13
“Britain is ready to confront whatever the future holds for us,” Osborne insists.
7.05am BST
07:05
George Osborne's breaks his silence with attempt to reassure the markets
The chancellor is about to stand up at the Treasury in London in his attempt to reassure the markets.
Updated
at 7.23am BST
7.04am BST
07:04
Justin McCurry
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.
6.45am BST
06:45
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.
Updated
at 7.23am BST
6.27am BST
06:27
Morning briefing
Claire Phipps
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.
The big picture
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:
Diary
Read these
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.
Baffling claim of the day
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
If today were a board game...
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.
And another thing
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