Race For UK Prime Minister Heats Up As Brexit Plans Differ

The U.K.'s ruling Conservative Party takes the next step toward selecting the nation's new prime minister on Tuesday after the leadership candidates outlined different ways to manage withdrawal from the European Union.

All 330 Tory members of Parliament will be balloted on the five contenders vying to succeed David Cameron, with the one receiving the fewest votes dropping out of the race when the results are announced at about 7 p.m. in London.

While Home Secretary Theresa May has secured the most public endorsements from colleagues and is the bookmakers' favorite, Energy Minister Andrea Leadsom on Monday topped one survey of party members and won the backing of former London Mayor Boris Johnson. Grassroots Conservatives will pick the leader once the field has been whittled down to two.

Less than two weeks since the public voted to quit the EU, all five aspirants have focused on when Britain should trigger Article 50 of the Lisbon Treaty -- the formal start of two years of negotiations with the EU -- and what level of single-market access Britain should seek. They also touched on how much control the U.K. will have on migration and the fate of citizens of other EU members who are already in the country.

The candidates must appeal to party lawmakers and activists, many of whom want a full and rapid departure from the EU, while avoiding too many promises they'll struggle to keep. The party plans to announce a new leader by Sept. 9.

"The new PM will not only be under pressure from Brussels to move ahead relatively soon," Carsten Nickel, deputy director of research at Teneo Intelligence, said in a report to clients. "Put differently, the current government's hesitation to invoke Article 50 should not be seen as a position that is shared throughout the Conservative Party."

May would get 63 percent support from party members, according to a survey of Conservatives by YouGov for the Times, well ahead of pro-Brexit Leadsom, who would get 31 percent. But a Conservative Home survey of 1,214 party members showed Leadsom enjoying 38 percent backing versus 37 percent for May, who sided with staying in the EU. Conservative Home said its survey relied on members actively responding and May would probably have done better in a random poll.

International Development Secretary Justine Greening became the latest cabinet minister to voice support for May on Tuesday, praising her "formidable track record and experience serving the nation."

Leadsom got a boost from Johnson's support, announced days after he dropped out of contention following the decision of Justice Secretary Michael Gove to run.
 "Andrea Leadsom offers the zap, the drive, and the determination essential for the next leader of this country," Johnson said in a statement on his Facebook page. "Above all she possesses the qualities needed to bring together Leavers and Remainers."

Last to outline how she would engage in talks with the EU, Leadsom said on Monday that she intended "to keep negotiation as short as possible" as "neither we nor our European friends need prolonged uncertainty."

Former Defense Secretary Liam Fox was more specific. "I would like to see us leaving the EU on January 1, 2019," he told reporters. "That means we will have to activate the Article 50 process by the end of this year."

Their Cabinet-level rivals for the post -- May, Gove and Work and Pensions Secretary Stephen Crabb -- have all urged caution, saying the U.K. needs time to establish its negotiating position and to hold preliminary talks with other European countries.

There's also significant disagreement over the EU single market, and whether retaining at least a degree of access would also mean keeping freedom of movement for EU citizens.

"We need to retain as much of that access as we possibly can, thus minimizing any damage to our economy from leaving the European Union," Foreign Secretary Philip Hammond, who is backing May, told the BBC. He said that effort would be damaged by blocking immigration from the EU.

That kind of compromise would be seen as "backsliding," Nigel Farage said on Monday after resigning as leader of the U.K. Independence Party. He described the single market as a "big business protectionist cartel."

"I will watch the renegotiation process in Brussels like a hawk," Farage said. "We need a prime minister who recognizes that we've got the trump cards."

Aside from the topic of Europe, May said she would commit to replacing the Trident nuclear deterrent system and urged a parliamentary vote this month. Meantime, Crabb said he would approve a new runway at Heathrow Airport if he becomes prime minister.

Leadsom, Gove and Fox, the three pro-Brexit candidates, have sought to undermine May by saying it would be better if the next prime minister supported leaving the EU. May, who last week said "Brexit means Brexit" as she launched her own bid, reluctantly backed "Remain" during the referendum, delivering only one major speech.

Setting out her differences with May, Leadsom said she's committed to "guaranteeing the rights" of EU citizens who already live and work in Britain and ruled out using them as "bargaining chips in our negotiations." May said on Sunday that negotiators will need "to look at" their status, along with that of Britons living abroad, while signaling she wants to "guarantee a position."

Crabb sided with Leadsom's position in an interview with the BBC on Tuesday.

"The idea that we will be at some kind of Checkpoint Charlie scenario where we're arguing over trading people living in each other's countries, that's not going to happen," Crabb said, referring to the Cold War-era crossing point in the Berlin Wall.

© 2016 Bloomberg L.P.

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