Downing Street forced to say Theresa May backs her Chancellor amid cabinet Brexit row

Philip Hammond has angered some Brexiteers with his approach to cabinet discussions on the EU

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Downing Street has been forced to say Theresa May retains "full confidence" in Philip Hammond, following reports the Chancellor is clashing with senior cabinet Brexiteers.

Mr Hammond is said to have angered Brexit-backers after raising concerns about the impact of a new work-permit system that could close the door to low-skilled migrants.

Rumours that Mr Hammond may even quit over the row also had to be quashed this morning, as Health Secretary Jeremy Hunt was sent out to play down claims of a cabinet split.

A spokeswoman for the Prime Minister cleared up any suggestion that Ms May was personally unhappy with Mr Hammond’s approach.

She added: "The Prime Minister has full confidence in the Chancellor and the work he is doing."

At Tory conference Mr Hammond emerged as a potential champion for people in the Conservatives who favour a softer Brexit, which sees economic considerations put ahead of arbitrary controls on immigration.

But his focus on protecting the economy goes against the tougher line on immigration and the single market taken by Ms May and others such as Foreign Secretary Mr Johnson, International Trade Secretary Liam Fox and Brexit Secretary David Davis.

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At a committee meeting last week the Chancellor expressed concerns about the introduction of a work permit system that would prevent unskilled EU immigrants coming to the UK.

One Brexit-backer told the Daily Telegraph: "He is arguing from a very Treasury point of view. He is arguing like an accountant seeing the risk of everything rather than the opportunity."

Health Secretary Jeremy Hunt today admitted there had been "lively debates" around the Cabinet table about how Britain's exit from the European Union is handled.

On Mr Hunt's comments, Ms May’s spokeswoman said: "This reflects the fact that the Prime Minister is pursuing a collective government approach where, either at Cabinet or through Cabinet committees, the relevant Cabinet ministers involved are able to debate the issues before decisions are reached.

"The Prime Minister is focused on making sure we prepare for the negotiations and get the best deal for the United Kingdom.

"There is a real sense among the ministerial team that the Government has a very important job to do, which is delivering the will of the British people on leaving the European Union and they are focused on working together to deliver those negotiations."