Britain will not stay in EU by the back door, pledges Cabinet

Hammond and Fox put end to infighting with promise to leave single market and customs union

BRITAIN will leave the single market and customs union entirely after Brexit in 2019, and will not stay in the European Union by the “back door”, Philip Hammond and Liam Fox declare today.

After a summer of bitter Cabinet infighting, the Chancellor of the Exchequer and Dr Fox, the International Trade Secretary, appear to bury the hatchet with a joint pledge that there will be a fixed transition period after leaving the EU. In an article written for The Sunday

Telegraph, the ministers – representing the Remain and Leave wings of their party – say this will be “time limited” and designed to avoid a “cliff edge” that could damage British business.

Although they do not say how long this period will last, it will not represent an attempt to stay in the EU indefinitely, they say.

Theresa May, who returns to work this week after her walking holiday, will be hoping that the declaration of resolve by Mr Hammond and Dr Fox will draw a line under weeks of damaging headlines with the Chancellor accused of trying to derail Brexit.

The Prime Minister’s summer holidays have been plagued by Tory rows over how Britain will leave the EU, with freedom of movement, the length of any transition deal and the size of the UK’s “divorce” bill at their heart.

Today’s article – which it is hoped will cheer Brexit supporters – comes as ministers will publish over the next 10 days papers on Britain’s Brexit plans covering the Irish border, the customs union, fisheries and agriculture.

As part of these proposals, The Tele

graph understands that the Prime Minister is to offer free movement to Irish citizens in and out of Britain after the UK leaves the EU. The establishment of a “Schengen area” between the two countries will be the key plank of a deal the Government hopes will help solve the issue of the Irish border after Brexit.

But it is the apparent declaration of peace between the warring Cabinet factions that will come as the biggest relief to Mrs May. In their article, Mr Hammond and Dr Fox say: “We respect the will of the British people – in March 2019 the United Kingdom will leave the European Union. We will leave the customs union and be free to negotiate the best trade deals around the world as an independent, open, trading nation. We will leave the single market, because there was a vote for change on June 23 and that is what we will deliver.

“We want our economy to remain strong and vibrant through this period of change. That means businesses need to have confidence that there will not be a cliff-edge when we leave the EU in just over 20 months’ time.

“That is why we believe a time-limited interim period will be important to further our national interest and give business greater certainty – but it cannot be indefinite; it cannot be a back door to staying in the EU. And it must ensure a smooth and predictable pathway for businesses and citizens alike. We are both clear that during this period the UK will be outside the single market and outside the customs union and will be a ‘third-country’ not party to EU treaties.

“But we are also clear that during this period our borders must continue to operate smoothly; goods bought on the internet must still cross borders; businesses must still be able to supply their customers across the EU and our innovative, world-leading companies must be able to hire the talent they need, including from within the EU. Once the interim period is over, we

want a permanent, treaty-based arrangement between the UK and the EU which supports the closest possible relationship with the European Union, retaining close ties of security, trade and commerce.”

The Prime Minister will hope that today’s joint intervention will put an end to damaging Cabinet Brexit splits.

Mr Hammond came under fire from Cabinet colleagues after he suggested during Mrs May’s absence on holiday that he wanted Britain to be able to trade freely with the EU for four years after Brexit. Dr Fox then hit back days later saying that any transition period would have to end before the next general election in 2022.

It was also claimed that Dr Fox and Boris Johnson, the Foreign Secretary, had been kept out of the loop over plans to allow EU citizens to continue to come to the UK after Brexit. That forced No 10 to make clear that freedom of movement will end in March 2019.

There was a further row last weekend when The Sunday Telegraph disclosed plans by civil servants to offer to pay the EU a £36billion Brexit divorce bill.