The government is expected to accelerate no-deal Brexit preparations on Tuesday with an extra £2bn funnelled to Whitehall departments.
Ministers already receive regular updates on no-deal planning, but the issue is set to dominate the final cabinet meeting before Christmas with uncertainty still surrounding Brexit.
It was reported that health secretary Matt Hancock had pushed the button on his own advanced no-deal plans and was to call on others to do the same.
Theresa May gave a statement to the Commons on Monday in which she addressed MPs about the European Council summit which ended with her needing further concessions to make her deal viable.
Tory and opposition MPs began to question whether Ms May is simply trying to “run down the clock” so that MPs would eventually be faced with a time-pressured choice between her deal and no deal.
The prime minister’s official spokesman said on Monday that there would be an announcement “shortly” about spending the Treasury’s £2bn contingency no-deal contingency fund.
Insiders later indicated that this is likely to happen later this week after cabinet had discussed the decision.
It has already been reported that Mr Hancock activated NHS no-deal plans last week amid spiralling fears key medicines could be caught up in chaos at the border.
It is also thought that international development secretary Penny Mordaunt is among those who would actually back the idea of a “managed” no deal.
The prime minister warned MPs that rejecting her deal in a vote now due in the week starting 14 January would not result in an alternative “miraculously” appearing.
“Avoiding no deal is only possible if we can reach an agreement or if we abandon Brexit entirely,” she said.
In a warning to campaigners calling for a second referendum, she said it would “break faith with the British people” and do “irreparable damage to the integrity of our politics”.
But one of Ms May’s closest allies said “all options” should remain open if the deal is rejected.
Pensions secretary Amber Rudd said it would be important to find out the “will of Parliament” on how to proceed, while business secretary Greg Clark also appeared to back an “indicative vote” to find out what – if anything – MPs could support.
Mr Clark told BBC Radio 4’s Today programme that if the deal was rejected “we can’t just have continuing uncertainty, and I think parliament should be invited to say what it would agree with”.
Downing Street said talks by officials were continuing “at all levels” in Brussels to seek further clarification and assurances on the terms of the existing deal – and particularly the nature of the proposed backstop – as agreed at the European Council last week.
But European Commission chief spokesman Margaritis Schinas said no further meetings between the EU and the UK to discuss the Brexit deal are expected.
“The deal that is on the table is the best and the only deal possible – we will not reopen it, it will not be renegotiated,” he said.
Meanwhile, Ms May rejected reports that predecessor David Cameron was giving her advice on handling the Brexit process.
She told the Commons: “He is not giving advice, the last time I spoke to him was when we actually agreed the Withdrawal Agreement, when I spoke to two former prime ministers as a matter of courtesy to indicate to them what had been negotiated with the European Union.”
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