Now May slaps down Hammond over no deal
Out-of-line Chancellor was using out-of-date figures, says angry PM
THERESA May slapped down her Chancellor yesterday after he was accused of deliberately undermining his Cabinet colleagues by warning of the dangers of a nodeal Brexit.
Philip Hammond sparked a row last week after claiming that a failure to reach a deal could cost the UK £80 billion every year – on the day that No 10 published its ‘no deal’ plans.
Yesterday, however, the Prime Minister made clear that leaving the EU without a negotiated settlement would not be ‘the end of the world’ for the UK.
And Liam Fox, the International Trade Secretary, also dismissed the Chancellor’s gloomy predictions – saying they were ‘hard to swallow’.
Last week Mr Hammond incensed anti-EU Tories by going public on his worries about a no- deal scenario just hours after Brexit Secretary Dominic Raab downplayed the impact. The Chancellor said leaving without a deal would cost the economy up to 10 per cent of GDP over five years.
Speaking to journalists on her way to Cape Town, the Prime Minister declined to support Mr Hammond – describing his predictions as out of date.
‘As I understand it, the Chancellor was setting out figures that came out in January,’ she said. ‘They were just work in progress at that particular time
‘Look at what the director of the World Trade Organisation (Roberto Acevado) has said. He said of a no-deal situation that it would not be a walk in the park, but it wouldn’t be the end of the world.
‘What the Government is doing is putting in place preparations so that if we are in that situation, we can make a success of it, just as we will make a success of the good deal that I believe we’re able to get – the deal that we’re working to get.’
Pressed twice more on the Treasury’s figures and whether they could change, she again described them as ‘a work in progress’.
‘What is important is that the Government sits down and negotiates with Europe in relation to the deal that we believe will be good for both sides, but at the same time recognising that as we don’t yet know what the outcome of those negotiations will be, that it’s right we make these preparations for a no-deal.’
Dr Fox, who is in Singapore touting trade opportunities to Asian governments and businesses, told the BBC: ‘Some of us remember the supposed economic shock we were going to get if Britain voted to leave the European Union.
‘What has, in fact, happened... we’ve added 600,000 jobs to the economy, we saw a record number of inward investment projects land in the UK last year and our economy has continued to grow.
‘That was over a two-year time horizon, so projections over a 15- year time horizon are rather hard to swallow.’
Mrs May yesterday confirmed ministers would pump £92million into investigating a homemade alternative to the EU’s Galileo satellite programme.
EU chiefs have threatened to restrict Britain’s access to the scheme which will be vital to vehicle satnavs, the Armed Forces and emergency services, because of post-Brexit security fears.
A study by London Economics, featured in a Whitehall report, found that the UK’s economy could suffer a £1billion-a- day hit if satellite navigation systems are disrupted.
Mrs May said: ‘We’ve been clear that the UK wants to remain involved in the EU’s Galileo satellite programme.
‘ But we cannot be an “end user”, shut out from security discussions and contracts, and without critical information about the system’s security.
‘Use of something we are unable to rely on has little value, and we cannot justify paying towards that.
‘So unless we receive assurance that we can collaborate on a close basis in the future – like the close security partners we aspire to be – we are clear that we will withdraw UK support for Galileo and pursue our own sovereign satellite system.’