Chancellor: A no-deal Brexit will cause chaos

PM in Brussels for more EU talks ahead of summit

Reporter THE rejection of Theresa May’s Brexit deal will lead to “economic chaos”, Chancellor Philip Hammond warned as the Prime Minister travelled to Brussels for talks.

Mrs May will meet European Commission president Jean-Claude Juncker and European Council president Donald Tusk before a summit of EU leaders today, which is expected to endorse the deal thrashed out between negotiators from the two sides.

Spanish Prime Minister Pedro Sanchez had threatened to boycott the European Council meeting without further guarantees for Madrid over the status of Gibraltar.

But a crisis was averted after a clarification about the position and emergency talks between Mr Sanchez, Mr Tusk and Mr Juncker.

A letter from the UK’s ambassador to the EU Sir Tim Barrow confirmed the Withdrawal Agreement imposes no obligations regarding the “territorial scope” of future agreements.

It also makes clear the UK will negotiate future agreements on behalf of all territories for whose external relations it is responsible – including Gibraltar.

A UK Government spokesman said: “For the withdrawal negotiations, given there are some circumstances which are specific to Gibraltar, we held talks with Spain which directly involved the government of Gibraltar.

“These were constructive and we look forward to taking the same approach to the future relationship.”

Mr Tusk said: “I will recommend we approve on Sunday the outcome of the Brexit negotiations. No one has reasons to be happy. But at least at this critical time, the EU27 has passed the test of unity and solidarity.”

But Mrs May also faced domestic difficulties as the Democratic Unionist Party held its conference in Belfast – with Boris Johnson making a guest appearance.

Mr Hammond sought to reassure the DUP over its “understandable concerns” about the Northern Ire- land backstop provisions aimed at preventing a hard border with Ireland.

He told BBC Radio 4’s Today programme he believes the deal on offer is better for the UK than remaining in the EU, stressing it will help heal the divisions caused by Brexit.

“It’s a way of leaving the European Union with minimum negative impact on our economy,” he said.

“Economics is not the only consideration – we also have to look at the political healing process, bringing our country back together because countries that are disunited and divided are not successful countries.”

He warned a no-deal Brexit would unleash “economic chaos”, adding: “If the meaningful vote is lost we are in uncharted territory.”

If the deal does pass the Commons, the repercussions could bring down Mrs May’s Government, with the DUP hinting at withdrawing the support of its MPs. Chancellor of the Exchequer Philip Hammond

Meanwhile, the Daily Telegraph reported the next stage of Mrs May’s Brexit sales pitch will be on the immigration concerns believed to have been a key factor in the Leave vote.

According to leaked Cabinet papers, the Home Office has drawn up plans to issue low-skilled migrants with 11-month visas “with restricted entitlements and rights” while they are living in the UK.

Alternative plans could allow EU migrants aged between 18 and 30 to live and work in the UK for two years, with a strict cap on numbers.