Ministers warned that a no-deal Brexit crash-out still on the cards

EUROPE could be forced to grapple with the fallout of a no-deal Brexit in the middle of the Covid-19 recovery, Cabinet ministers will be warned.

Tánaiste Simon Coveney will tell Cabinet today he does not believe the UK will apply for a Brexit extension before the June 30 deadline.

This means senior government officials across eight different departments are currently preparing for the heightened prospect of a disorderly Brexit at the end of the year.

Ministers will also be told a new Brexit omnibus bill must be prepared as soon as possible to address the possibility of either an orderly or disorderly Brexit.

A major piece of legislation was passed by the last Dáil over fears of a no-deal Brexit.

However, a last-minute deal was agreed between Taoiseach Leo Varadkar and UK Prime Minister Boris

Johnson. The withdrawal agreement expires at the end of the year but the UK can extend the transition period if it makes a request to the EU by June 30.

Mr Coveney’s memo says the Government is making preparations on the basis that Mr Johnson will not seek an extension.

All government departments are preparing for either a no-deal Brexit or a limited trade deal with the UK.

The memo will seek approval for an “umbrella” piece of legislation spanning across several departments to address the impacts of both scenarios.

Mr Coveney will also ask colleagues to sign off on a new information campaign to raise awareness around the potential impacts of either Brexit outcome.

A fresh round of Brexit negotiations led by EU chief negotiator Michel Barnier is due to begin next week.

Once the talks are completed, there will be a high-level summit between EU and UK leaders.

“Brexit hasn’t gone away and with Covid there too we are going to have a tough few months ahead, and it could be grim enough for businesses,” a source said.

Yesterday, the EU signed off on a €750bn plan to help stave off post-virus recession through grants and interestfree loans.

The long-debated bailout package is an attempt to break the deadlock between Mediterranean countries worst hit by the coronavirus and countries in the north who fear having to pay other states’ debts.

It follows an intervention 10 days ago by French President Emmanuel Macron and German Chancellor Angela Merkel.

The proposal was welcomed by the countries hit heaviest by the virus – such as Spain, Italy and France – as well as by Germany.