Anti-Brexit protesters congregated outside Parliament as the government was defeated on two key parts of legislation by members of the unelected House of Lords. REUTERS/Hannah McKay
Anti-Brexit protesters congregated outside Parliament as the government was defeated on two key parts of legislation by members of the unelected House of Lords. REUTERS/Hannah McKay
Anti-Brexit protesters congregated outside Parliament as the government was defeated on two key parts of legislation by members of the unelected House of Lords. REUTERS/Hannah McKay
Anti-Brexit protesters congregated outside Parliament as the government was defeated on two key parts of legislation by members of the unelected House of Lords. REUTERS/Hannah McKay

May suffers 13th defeat on Brexit legislation in the UK Parliament


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Britain’s upper house of Parliament inflicted another embarrassing defeat on Prime Minister Theresa May’s government on Tuesday, challenging her plan to leave the European Union’s single market after Brexit.

Mrs May, who has struggled to unite the government behind her vision of Brexit, has said Britain will also leave the EU single market and customs union after it quits the bloc next March.

That stance has widened divisions not only within her own Conservative Party but also across both houses of parliament.

By a vote of 245 to 218, the unelected upper chamber, the House of Lords, supported an amendment to her Brexit blueprint, the EU withdrawal bill, requiring ministers to negotiate continued membership of the European Economic Area, meaning that it would remain in the single market.

“The time has come over Brexit, really, for economic reality and common sense to prevail over political dogma and wishful thinking,” said Peter Mandelson, a member of the House of Lords from the main opposition Labour Party, who backed the amendment.

His comments drew criticism from pro-Brexit peers, including Conservative member Michael Forsyth who described the amendment as part of an attempt by “a number of people in this house who wish to reverse the decision of the British people”. Those proposing the amendment deny the charge.

This is the 13th time in recent weeks that the government has been defeated in the House of Lords on the draft legislation that will formally terminate Britain’s EU membership.

The votes can be overturned by the more powerful lower house, the House of Commons, where Mrs May’s Conservative party has a slim majority with the support of a small Northern Irish party, but could embolden lawmakers who hope to derail her plans to forge a new relationship with the EU.

The defeat was also damaging for the Labour leader Jeremy Corbyn after members of his party in the upper house defied orders to abstain from the vote and instead backed a cross-party alliance in support of the amendment.

While Mr Corbyn has changed his position to support Britain’s membership of a customs union with the EU, he remains opposed to remaining in the single market.

Earlier, opposition parties in the Lords and rebels in the Conservative Party inflicted another defeat on the government, voting to strip out the fixed timing for Britain to leave the EU at 11pm on March 29 next year.

The government has already set the clock ticking in a two-year exit process hampered by her gamble on a snap election last June which cost her party its majority in parliament. It also remains unclear what the final divorce deal will look like.

Some lawmakers criticised the government’s plan to impose a specific date for Britain leaving the EU, saying it would create significant difficulties if negotiations with Brussels went down to the wire.

The upper house of parliament also voted on Tuesday in favour of an amendment whereby Britain would continue to participate in EU agencies after leaving the bloc.

After the Lords, the bill will return to the House of Commons. Both houses have to agree on the final wording of the bill before it can become law.

This is the penultimate session for the bill in the upper chamber during the report stage, where members have already voted in favour of amendments including to compel ministers to seek a form of customs union with the EU.

Mrs May’s slim majority in the House of Commons is likely to be severely tested in the next few weeks when she is expected to urge her divided party to reject the proposed changes.

Lawmakers will have to decide later this year whether to back the government or reject the law — with the risk that Britain could crash out of the EU in 2019 with no deal in place.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Syria v Australia
2018 World Cup qualifying: Asia fourth round play-off first leg
Venue: Hang Jebat Stadium (Malacca, Malayisa)
Kick-off: Thursday, 4.30pm (UAE)
Watch: beIN Sports HD

* Second leg in Australia scheduled for October 10