EU’s position in Brexit negotiations does not make sense, Philip Hammond says

The Chancellor accepted that negotiations could create uncertainty for the British economy

Jon Stone
Political Correspondent
Sunday 20 November 2016 12:01 GMT
EU’s position in Brexit negotiations 'does not make sense'

The EU’s hardline stance against the UK in the upcoming Brexit negotiations “doesn’t make a lot of sense”, the Chancellor has said, as he warned that the talks will bring uncertainty to the British economy

Philip Hammond urged EU countries to “think very carefully about what they want” before hanging Britain out to dry in any post-Brexit settlement.

EU leaders have repeatedly said the UK will not get trade concessions if does not participate in freedom of movement with the bloc – upholding one of its founding pillars. They have also threatened to withhold so-called “passporting” rights for the City– which would pull the rug out from under the UK’s financial sector.

An EU diplomat said this weekend that watering down that negotiating stance could be “seen to be giving in to a country that is leaving” – and embolden far-right parties on the continent who could do untold damage in the long-run.

Mr Hammond told BBC One’s Andrew Marr Show on Sunday: “This will be a long process. Part of this process will be about the Europeans themselves thinking very carefully about what they want, because some of what I’m hearing from European politicians I understand in terms of political rhetoric, but doesn’t make a lot of sense in terms of economics.”

He said he believed the EU benefited from the City of London’s access to the single market, before adding: “It has to work for Britain and the European Union. This is a negotiation and it’s got to be a win-win outcome.”

Mr Hammond also admitted the negotiations’ outcome would bring uncertainty for the British economy.

“You’ve seen the range of independent forecasts that are out there and many of those forecasts are pointing to a slowing of economic growth next year and a sharp challenge to the public finances. There are a range of reasons for that,” he said.

“As we go into a period where there will be some certainty around the negotiations.”

Despite the warning that uncertainty could damage economic prospects Mr Hammond resisted calls on the programme to actually reveal the Government’s starting position, aims or approach to Brexit, saying only in unhelpful relative terms that he wanted the “best deal” or “the best access”.

The complete transparency blackout from No 10 and the Government in general has led to accusations that the Government is in fact dreadfully split on the issue and does not in fact have a plan to disclose.

Mr Hammond, who is understood to favour a more cautious approach to Brexit, tacitly acknowledged the suggestions of a split but downplayed their significance.

“I think you’d be surprised by the degree to which the Cabinet is coming together around a view of the challenges and the opportunities as we move this debate forward,” he said.

“We’re doing a huge amount of work, David Davis’s department, Liam Fox’s department, and some of the messages we hear from people who haven’t gone into this issue in such great depths bely the complexity of this deal. We want to get the best deal we can possibly get.”

Warring factions of the Conservative party ramped up their lobbying of the leadership this weekend with a small group of pro-Remain MPs calling for the Government to drop its Supreme Court appeal. This was shortly followed by 60 eurosceptic MPs calling for a Hard Brexit – leaving the customs union and single market.

Theresa May has said only that she will trigger Article 50 in the first quarter of 2017.

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