Theresa May (pictured at Davos on January 25) has been challenged by Eurosceptic MPs to make a clean break with Brussels or face a leadership challenge
Theresa May faces the threat of a leadership challenge as a group of 60 Eurosceptic MPs warned her to make a clean break from Brussels or they would scupper her premiership.
The Tories were plunged into war by Philip Hammond saying leaving the EU would result in only ‘very modest’ change.
The Chancellor sparked uproar among Eurosceptic MPs after he said Britain would stay in a ‘customs arrangement’ with the EU – and suggested free movement might continue in all but name.
The ferocious backlash led No 10 to disown the remarks and forced Mr Hammond to issue a partial ‘clarification’, insisting he stood by Tory pledges to make a clean break with the EU.
It came amid claims that at least 40 MPs have sent letters to Sir Graham Brady, chairman of the 1922 Committee of Tory backbenchers, expressing no confidence in Mrs May.
There needs to be 48 names to spark a leadership contest. It is understood that some of the Prime Minister’s critics believe she is too ‘timid’ to achieve a clean Brexit.
Prominent Eurosceptic Jacob Rees-Mogg said it was now clear Brexit was ‘at risk’, as Cabinet Remainers, led by Mr Hammond, attempt to water it down beyond recognition.
He said some ministers appeared to be ‘cowed by the EU’ and warned they were in danger of throwing away the ‘great Brexit opportunity’.
In a speech in Hampshire he accused the Chancellor and other pro-Remain ministers of treating Brexit negotiations as a ‘damage limitation exercise’.
He said: ‘The British people did not vote for that. They did not vote for the management of decline.
‘They voted for hope and opportunity and politicians must now deliver it. If we do not, if we are timid and cowering and terrified of the future, then our children and theirs will judge us in the balance and find us wanting.’
The Tories were plunged into war by Philip Hammond (pic in Davos on January 25) saying leaving the EU would result in only ‘very modest’ change
Mr Rees-Mogg said remaining in close alignment with the EU was ‘unacceptable’, as it would make it impossible for the UK to compete in fast-growing world markets.
‘There is a great Brexit opportunity and some really obvious benefits that we can get that improve the condition of the people,’ he said.
‘This is currently at risk. The negotiations that are about to begin sound as if they aim to keep us in a similar system to the single market and the customs union. “Close alignment” means de facto the single market, it would make the UK a rule-taker like Norway, divested of even the limited influence we currently have.’
Privately, some Tory MPs warned that Mrs May’s tenure as premier would be put in jeopardy unless she reined in the Chancellor and made it clear she would stick to her Brexit pledges.
Former Tory leader Iain Duncan Smith said Mr Hammond was guilty of ‘undermining’ the PM at a critical time.
Andrew Percy, another former Tory minister, told Mr Hammond bluntly to ‘put a sock in it, Phil’. The row came as senior Tories urged the Prime Minister to ‘get a grip’ on her warring Cabinet after days of leaks and toxic briefings.
Behind the scenes, Mr Hammond is leading a group of Cabinet Remainers locked in battle with Leavers led by Boris Johnson over the fate of Brexit.
The row burst into the open yesterday after he delivered an incendiary speech to a CBI event at the annual gathering of the global elites at Davos.
The Chancellor praised the CBI for ‘its focus on securing the closest possible future relationship between the EU and the UK, post Brexit’.
Describing Britain’s future relationship with the EU, he suggested there would be only minimal change, adding: ‘We are taking two completely interconnected and aligned economies with high levels of trade and selectively moving them, hopefully very modestly apart.’
Prominent Eurosceptic Jacob Rees-Mogg (file photo) said it was now clear Brexit was ‘at risk’, as Cabinet Remainers, led by Mr Hammond, attempt to water it down beyond recognition
He suggested free movement would remain in all but name, saying: ‘We want to maintain the closest possible relationship in people to people exchanges.’
Downing Street initially ducked questions about Mr Hammond’s comments. But, as Tory anger grew, a source later issued a reprimand, 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.’
In a series of messages on Twitter last night, the Chancellor said he was clear that Britain would leave the EU next year and would be ‘outside the customs union and the single market’.
Former Cabinet minister Owen Paterson said Mr Hammond should quit if he could not reconcile himself to Brexit.
He said: ‘The Chancellor needs to follow Government policy. If this speech represents what he really thinks then he should not be in Government.’
Tory grandee Bernard Jenkin said he was ‘very uncomfortable’ with the idea of pursuing a transition deal at all, adding: ‘We need to see what safeguards are in place to ensure that we are not just subjected to foreign rule during that period. And it will only be worth it if the deal at the end of it is what we want, otherwise it will not be worth it.’
Last night a senior Eurosceptic said a calculated push was underway to highlight concern about the Government’s direction on Brexit. He said: ‘We have been nice, nice, nice to the Government …
‘But that is changing very fast – we are going from nought to 60 in terms of raising concerns, and you are going to be hearing a lot more like this.
‘The Government has to understand its majority … rests on 100 MPs who think like us. We are very suspicious about the talk on transition – we will not accept an endless transition where nothing changes.’
The developments came as David Davis and Liam Fox warned ministers will not sign up to a Brexit transition period unless Britain is set free to negotiate and sign trade deals during it.
The Brexit Secretary and International Trade Secretary said they were determined to ‘fire the starting gun’ on a process that will ‘make Britain a great trading nation again’. They said Brexit would spark ‘the beginning of a bright future for our country’.
The UK is barred from opening trade negotiations while it remains a member of the EU, and some in Brussels are pushing for this restriction to be extended throughout a two-year transition – till 2021 – that is now being negotiated.
Setting out a new negotiating red line, the two ministers said it was essential for the UK to have the freedom to ‘formally discuss and sign new trade deals that are ready to come into force straight after this strictly time-limited period’.
Ministers will not sign up to a Brexit transition period unless Britain is set free to negotiate and sign trade deals during it, David Davis (left) and Liam Fox (right) warned last night
They also sought to calm Eurosceptic concerns about the transition period, when the UK is likely to remain governed by EU laws.
The two ministers said a transition period is essential – not least because the EU is unable to strike a new trade deal with the UK until we have actually left.
They describe the two-year interlude as a ‘bridge’ that will allow the UK to take ‘the crucial steps needed to ensure our future outside the EU is a prosperous one’.
They also set out plans to continue with dozens of trade deals already negotiated by the EU, saying this will help avoid ‘unnecessary disruption’ for business.
Mr Davis will set out further details of the Government’s negotiating aims for the transition in a major speech today.
The EU is due to publish its own negotiating terms for a transitional deal on Monday.
Allowing the UK to negotiate its own trade deals would require the EU to set aside its central principle of ‘sincere co-operation’ during the transition.
But sources last night suggested Brussels was willing to bow to the UK’s demands on trade negotiations, provided no new trade deals come into force until after the UK has fully left.
Officials in Brussels however revealed that the Government has so far failed to tell the EU whether it wants to ‘roll over’ around 759 international agreements that currently apply to Britain as a member of the bloc.
In a move aimed at easing trade across the bloc after Brexit, Brussels has said it will allow the UK to copy the deals with 168 countries during the transition as they will otherwise end on transition day.