Tory divide deepens as Chancellor backs plan to ease Britain's withdrawal from the EU

Chancellor Philip Hammond today backed a post- Brexit transitional deal between Britain and the EU .

The top Tory deepened a major Cabinet split over arrangements after the UK quits the bloc.

Brexit Secretary David Davis last week said he was “not really interested” in such a pact to ease withdrawal, according to a leaked memo of a meeting with City fatcats .

In a thinly-veiled slap down to his colleague, Mr Hammond insisted “thoughtful politicians” believed a transitional deal would be “beneficial”.

He told the Treasury Select Committee: “​There is, I think, an emerging view among businesses, among regulators and among thoughtful politicians – as well as probably quite a universal view among civil servants on both sides of the English Channel – that having a longer period to manage the adjustment between where we are now as full members of the European Union, and where we get to in the future as a result of the negotiations we will be conducting, would be generally helpful, would tend towards a smoother transition and would run less risks of disruption, including, crucially, risks to financial stability, which must be a very real concern.”

David Davis ‘not really interested’ in easing withdrawal

He added: “Transitional arrangements would be beneficial to us.”

His comments came as a Parliamentary report warned Theresa May would struggle to achieve a “bespoke” deal with the EU within the time limit set down the negotiations.

Once Article 50 is triggered in March next year, the UK has just 18 months to negotiate a new agreement with Brussels.

The House of Lords EU Internal Market and External Affairs Sub-committees said it would not be possible to reach a comprehensive deal within that time period and the UK would be forced to fall back on World Trade Organisation (WTO) rules – with “significant” tariffs for British exporters – unless there were transitional arrangements in place.

“Although this would require clarity on the principles of what the UK is transitioning to, it would not delay the UK’s withdrawal. But it would safeguard current trade and provide adequate time for negotiations,” the report said.

The Commons Treasury select committee also announced it was holding an inquiry into what transitional arrangements were needed.

Keir Starmer will tomorrow put Labour at the forefront of the battle to prevent a hard Brexit.

The Shadow Brexit Secretary says the opposition will not allow any deal that puts the economy and jobs at risk.

Keir Starmer

Keir Starmer will not allow any deal that puts the economy at risk

In his first major speech since taking on the role, Mr Starmer will also call on Theresa May to keep her promise to come up with a detailed plan before triggering Article 50 .

He will say the country faces a choice between the UK out of the single market and the customs union and “torn apart from our EU partners.”

This would see the UK reverting to World Trade Organisation rules that would see firms hit with high trade tariffs.

“A global race to the bottom which would not only put our economy and jobs at risk, but which would also abandon our shared scientific, educational and cultural endeavours with the EU. So-called ‘Hard’ Brexit ,” he will say.

The other option is building a “new and strong” relationship with the EU.

This would be a “future which preserves our ability to trade in goods and services with our biggest market.”

Theresa May criticised for not addressing the ‘national interest’ in regard to Brexit

“A future that values joint scientific, educational and cultural work with our EU partners. A future which allows the UK to retain its leading position in the world, influencing and contributing to developments across Europe and beyond,” he say in the speech at Bloomberg in London.

He will say Brexit is the defining “battle of our time” and only Labour is capable to bringing the “country back together.”

By contrast he will claim Theresa May only has a message “for one side of the divide”.

Labour “will respond to Brexit in the national interest” as the UK enters two years of negotiations.

“The opposition needs to be in that battle. Labour needs to be in that battle.

“If we are not, the chance to shape the future of our country will be lost. Future generations will not forgive us for such a dereliction of duty,” he will say.

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