At least 15 Conservative MPs are in talks with a Labour MP to prevent a hard Brexit – potentially enough to defeat Theresa May in the Commons.
Stephen Kinnock said there was a “growing recognition” of the need for Britain to embrace a Norway-style arrangement to head off the threat of severe economic damage.
The MP said he was seeking support for Britain remaining within the European Economic Area (EEA) after Brexit and, therefore, the EU single market – at least for a period of time.
“I have been reaching out with a particular proposal to 15 Conservative MPs so far,” he told The Daily Telegraph.
“There is a growing recognition now in the economy that getting the right transitional deal is now the top priority.
“What we need to do is to form a coalition of common sense to secure in particular a sensible pragmatic transition deal, which in my opinion should be based on the EEA.
“It is a sensible half way house to give our economy the certainty it so desperately needs.”
Given the Prime Minister’s precarious working majority of just 12, a group of 15 rebel Tories could be sufficient to defeat the Conservatives in any Commons vote.
However, that would require Labour to shift its confusing policy, which is currently only to keep the “benefits” of membership of the single market, without explaining how.
Two weeks ago, Jeremy Corbyn sacked three shadow ministers who supported an amendment to the Queen’s Speech aimed at keeping Britain in the single market.
But Lord Adonis, the former Labour Cabinet minister, said it was “only a matter of time” before Mr Corbyn followed the public in backing the single market.
And new research suggests voters are in the mood for compromise, placing more value on maintaining strong trade with the EU than on curbing free movement of workers.
The survey, by King's College London and Cambridge University, found backing for a Norway-style relationship - remaining within the single market, while accepting freedom of movement and some loss of sovereignty.
Ms May has made ending free movement her “red line” in the Brexit negotiations, arguing the public clearly voted to curb EU immigration.
But a growing number of MPs argue it is possible to prevent people coming to Britain without jobs to go to, without breaching EU rules on free movement.
Mr Kinnock added: “The case for the EEA is three-fold. It buys us time to negotiate the final state deal with the EU, it delivers certainty for business and workers, and it allows us to reform freedom of movement.”
Lord Adonis – who described a hard Brexit as the “worst mistake this country has made since appeasement in the 1930s” – predicted Labour would back staying in the single market.
“We are winning the argument in the country,” he told BBC Radio 4’s Today programme.
“The party will follow the country - they always do. It’s only a matter of time before politicians come into line with the public.
“There is no way that the Labour party - as the party representing the working people of this country - is going to take a position that sacrifices their jobs and makes them poorer.”
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