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February 08, 2016


Brexit discussion to get a lot more complicated

The British polling on the EU referendum are very hard to read - for reasons we will explain below. Here is the latest YouGov poll, as published in the The Times newspaper, which shows that the draft agreement between Donald Tusk and David Cameron appears to widen the gap in favour of the No Camp, which, according to this poll, is now leading 45 to 36. What is notable is that the Leave camp, which had steadily lost support until last year, is now almost back to the strongest days in 2011-2013. Here is the chart: 

According to YouGov, only 22% of those questioned said the deal between Tusk and Cameron was a good deal, while 56% said the changes didn't not go far enough. And 54% say the changes to benefits for EU migrants will make no real difference to immigration levels from Europe. This is remarkably similar to the comments in Britain's conservative media, so one may wonder to which extent these negative views constitute a reflection of media reporting.

Polls like this will make it harder for Cameron to reach an agreement in Brussels later this month. The draft agreement still has a few empty parts in, and no doubt both Cameron and other leaders will try to rephrase bits of it. We noted last week that the Bank of England wants some of the proposals on financial services sector flashed out in greater detail. For a good analysis of everything that is wrong with the joint declaration see Andrew Duff's comment. The bottom line is that there are so many open strands that the Council may end up agreeing only to a subset of Cameron's demands. In view of the polling above, that would increase the probability of a pro-Brexit vote. On the banking union, Duff points out that separation of the single rule book into two will require important secondary legislation, which will, of course, have to include the European Parliament, which is not a direct part of this agreement. He is also wondering about the practicality about Britain's right to delay any euro-related legislation that is against its own interest. How would that work in a crisis, he asks?

And finally, we have this from Comres, a research consultancy that prides itself for getting the British elections polling right last year. Comres believe that most of the Brexit polls, like the one we cited above, are dead wrong for the same reason that they failed to predict the Conservative victory at the last election. The issue is online polling vs telephone polling. The latter give a much more precise result, but are more expensive. Their own recent telephone polls show 56% in favour of Remain and 35% in favour of Leave. These figures are almost identical to the numbers of their previous poll from September. Comres noted that Ipsos Mori, the only other polls to use telephone interviews, also reports double-digit leads for Remain.

Our other stories

We also have stories on: the difficulties faced by the Greek pension reform; the continued anti-euro stance of the FN; the Commission's approval of Portugal's budget; Ángel Ubide's criticism of German influence in EU crisis policies; the BIS' worries about emerging market deleveraging; confusion on interpreting negative rates; doubts whether France will decide to strip terrorists of nationality; the German defence of the €500 bill; and Wolfgang Münchau's scenario of populist governments appointing activist central bankers.

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