Airing dirty laundry in public is ‘deliberate poke in the eye for PM’

At the best of times, those closest to Theresa May and Philip Hammond describe their relationship as “businesslike”. But this week has been among the worst of times, and behind the facade of Downing Street, relations between Nos 10 and 11 have become increasingly dysfunctional.

Even the most on-message insiders use words like “tetchy” and “fractious” to describe the Prime Minister and the Chancellor’s relationship. Some use rather more Anglo-saxon terms.

Yesterday the Prime Minister’s spokesman had to confirm – not for the first time – that the Chancellor retained Mrs May’s “full confidence”, after Lord Lawson suggested Mr Hammond should be sacked.

In the space of a week, Mrs May has come under pressure to sack both her Foreign Secretary and her Chancellor. No wonder civil servants are busily preparing for a reshuffle they are increasingly convinced is coming.

The latest downturn in the relationship between the Prime Minister and the Chancellor – the most important in any government – has its roots in a Cabinet row on Tuesday, when Brexiteers and Remainers squared up over plans for a no-deal outcome to Brexit talks.

Michael Gove, the Environment Secretary who helped run the Leave campaign, wanted to discuss ideas on what the UK’S fishing policy would be in the event of no deal, then suggested that the Cabinet should receive weekly updates on how much money each department was spending on their preparations for no deal. Mr Hammond disagreed.

The Cabinet immediately split into two factions, and rather than bringing the Europhiles and Eurosceptics to heel, Mrs May simply moved the meeting on to another subject.

Mr Hammond responded by writing an article for The Times in which he said that he would only spend money on no-deal preparations “when it is responsible to do so”.

One government source described it as “a deliberate poke in the eye for Eurosceptics and arguably the Prime Minister herself.

“He was carrying on the Cabinet row on the front pages of the next day’s newspapers, so it’s hardly surprising that people are annoyed with him.

“In some ways it’s worse than what Boris Johnson did when he set out his Brexit vision in The Daily Telegraph because Boris was trying to head off a soft Brexit but the Chancellor was taking a private Cabinet row into the public domain. You just don’t do that.”

Mrs May had ramped up the prospect of no deal in a Commons statement on Monday to put pressure on Brussels negotiators, but by playing down the idea of spending money on preparations for no deal, Mr Hammond undermined her message.

Another source said: “It definitely cheesed off No10 and not just because it went against what Theresa May had said, but because it is what Hammond seems to have spent the past year doing – trying to soften Brexit.”

A source close to Mr Hammond said: “These reports have been massively exaggerated; people are getting very excited about headlines but in reality the thrust of what Philip Hammond and Theresa May are saying about Brexit is the same.

“It would be a waste of taxpayers’ money to spend millions of pounds on something that isn’t going to happen – like no deal – that’s just the reality of the situation.”

‘It definitely cheesed off No10 and not just because it went against what Theresa May had said’