UK's May to fight no confidence vote 'with everything I've got'
PM says new leader 'would have to delay or stop Brexit'
Pound slumps below $1.25 before recovering
Cabinet ministers, business leaders call rebels 'self indulgent'
UK Prime Minister Theresa May said she would contest a challenge to her leadership scheduled for Wednesday evening "with everything I've got" after rebel Conservative MPs triggered a vote of no confidence in frustration at her inability to deliver a Brexit deal.
Speaking in Downing Street, May said a change of leader at this point would not work in the national interest, and, under party rules, would not be completed in time with a legal deadline to put a Brexit proposal to parliament.
The pound slumped below $1.25 on the news of the ballot before recovering slightly.
"A change in leadership in the conservative party now would put our country's future at risk and create uncertainty when we can least afford it," May said.
"A new leader wouldn't be in place by the 21st of January legal deadline, so a leadership election risks handing control of the Brexit negotiations to opposition MPs in parliament."
"The new leader wouldn't have time to renegotiate the withdrawal agreement and get the legislation through parliament by the 29th of March so one of their first acts would have to be extending or rescinding Article 50, delaying or even stopping Brexit when people want us to get on with it."
48 LETTERS
Earlier on Wednesday, Conservative chair of the 1922 backbench committee Sir Graham Brady said the 48 letters required to trigger a ballot had been submitted. The vote will take place between 1800 and 2000 GMT and May needs 158 votes to survive.
"The votes will be counted immediately afterwards and an announcement will be made as soon as possible in the evening," Brady said.
"She was very keen that the matter should be resolved as rapidly as reasonably possible. That's something that obviously I was keen to facilitate so we made sure the announcement was made this morning, certainly before the London markets opened," he said afterwards.
May will be deposed if she loses the ballot and a leadership contest will take place, but if she wins her opponents cannot challenge her for a year.
Analysts said she was likely to win, given that a majority of Tory MPs are pro-EU. However, they warned that she could resign if the margin of victory was narrow, adding that in any event, the adverse parliamentary maths on her Brexit deal wouldn't change.
If May were to win, she would still have to get the deal through parliament, which looks unlikely if the EU stands firm. That would mean several scenarios come into play; either a defeat in the commons, an extension of Article 50, halting the Brexit process, a parliamentary vote of no confidence tabled by the opposition Labour Party or a second referendum.
CABINET SWINGS BEHIND MAY - IN PUBLIC
All senior Cabinet ministers immediately threw their weight behind May, including pro-European Chancellor Philip Hammond, although this was no guarantee they wouldn't stab her in the back given the number of hard Brexiters among their ranks. No-one in the upper echelons would publicly tip their hand and the two-face nature of Tory politics cannot be underestimated.
"The Prime Minister has worked hard in the National (sic) interest since the day she took office and will have my full support in the vote tonight. Her deal means we leave the EU on time, whist protecting our jobs and our businesses," Hammond said.
Justice Secretary David Gauke said May had his "full support", and was more scathing of his rebellious colleagues, calling them "self indulgent and irresponsible".
The pair were joined by Work & Pensions Secretary Amber Rudd and International Development Secretary Penny Morduant, herself an enthusiastic Brexiteer, Sajid Javid and the hard-right Transport Secretary Chris Grayling.
Business leaders were scathing of the move to unseat May, with British Chambers of Commerce director general Adam Marshall saying he was watching events with “utter dismay”
"At one of the most pivotal moments for the UK economy in decades, it is unacceptable that Westminster politicians have chosen to focus on themselves, rather than on the needs of the country," he said.
"The utter dismay amongst businesses watching events in Westminster cannot be exaggerated. Our firms are worried, investors around the world are baffled and disappointed, and markets are showing serious strain as this political saga goes on and on."
"History will not be kind to those who prioritise political advantage over people’s livelihoods."
May's leadership came under increasing pressure overnight after she pulled a key vote on her Brexit withdrawal agreement with the European Union when it became obvious it would be crushed in parliament.
She spent Tuesday meeting with European leaders and European Commission president Jean-Claude Juncker trying to win last-minute concessions, particularly on the Northern Ireland backstop which had infuriated many of her MPs.
For their part, EU leaders intensified preparations for Britain crashing out of the bloc with no agreement. Juncker said earlier on Tuesday there was “no room whatsoever for further renegotiation”.