New rift in Cabinet

Hammond rebuked after calling for soft Brexit

Philip Hammond: rebuked by the Prime Minister

Chancellor Philip Hammond opened another rift in the Cabinet after telling an audience in Davos that the UK leaving the EU would mean only “very modest” changes.

Speaking at the World Economic Forum in Davos, the Chancellor prompted a furious reaction from hardline Brexiteers by saying he wanted the “closest possible relationship between the EU and UK post-Brexit”.

Referring to Britain’s trading arrangements after withdrawal next March he added: “We are taking two completely interconnected and aligned economies with high levels of trade and selectively moving them, hopefully very modestly, apart.”

Mr Hammond was rebuked by Prime Minister Theresa May and today the Brexit Secretary David Davis will attempt to reassure leavers that the government is committed to seeking fresh trading deals for the UK.

Downing Street issued a statement saying: “The Government’s policy is that we are leaving the Single Market and the Customs Union.

“Whilst we want a deep and special economic partnership with the EU after we leave, these could not be described as very modest changes.”

Mr Hammond sought to clarify his comments on Twitter, stating: “I said in #Davos that gov wants to minimise any reduction in access to EU market post Brexit.

“And it’s a fact our economies are integrated, that’s the baseline from which we leave the single market and customs union – which clearly represents change.

“For anyone concerned – I was clear earlier in same speech at #Davos U.K. will cease to be member of EU on 29 March 2019, and after we will be outside Customs Union and the Single Market.”

Mr Davis will today attempt to quell claims by leading backbench Brexiteer Jacob Rees-Mogg that close alignment with the EU after Brexit would prevent “meaningful” trade deals.

In a speech in Middlesbrough today Mr Davis will say the UK will effectively follow the regulations of the single market and customs union during an “implementation period”.

He will add: “The UK’s fastest growing export markets between 2005 and 2014 included countries like China and Brazil. And we will be able to do so much more with them, when we are an independent trading nation, outside of the EU.

“Of course maintaining access to each other’s markets on current terms means we will replicate the effects of the EU customs union during the implementation period.

“But participating in a customs union should not preclude us from formally negotiating — or indeed signing — trade agreements. Although, of course, they would not enter into force until the implementation period has ended.”


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