The threat of “damage” from a no-deal Brexit and the hard deadline of March 29 is driving progress in the Brexit talks, U.K. Chancellor Philip Hammond said.
In an interview with the BBC’s Today program, the chancellor effectively admitted that the government’s negotiating strategy is to try to use the ticking clock to its advantage. He said the threat of no-deal was concentrating minds on both sides of the Channel.
“My own view is that what is driving the process at the moment is the sense of a deadline. It is the fact that that deadline is there that is getting the movement that we’re seeing in Brussels,” the finance minister said.
“As people start to look at and contemplate the possibility of a no-deal exit, and the damage that would do to the U.K.’s economy and its standing in the world, they become more and more prepared to look at how we build that compromise which takes us forward with a deal,” he said. The Bank of England has predicted that U.K. economic output could drop by as much as 8 percent in a no-deal scenario.
“There is always the possibility of no-deal as an outcome. I, and my colleagues, are absolutely committed to avoiding that outcome,” Hammond added.
The chancellor also said there was no guarantee that the EU27 would approve any U.K. request to extend Article 50 beyond the March 29 Brexit date to give more time to reach a deal. “It would be quite high-risk just to assume that Brussels would grant an extension, if it was sought,” he said.
Asked if the U.K. had asked whether an extension request would be granted, the chancellor said that in international negotiations, it was normal for each side to play their cards “close to their chest.”
“Bear in mind that the European Union isn’t a single entity. It’s 27 member states marshalled together in a Council herded by the Commission. It’s not an agile or easy structure to be able to bring to complex decisions. How the EU would react to any request around [an] extension of time would depend entirely on the circumstances,” Hammond said.
“I fully recognize that it is very uncomfortable that we are as close to the wire as we are, but I’m afraid that’s just a feature of this kind of negotiation,” he added.
The chancellor also rejected the notion that the Tory party has been overrun by a faction of right-wing Brexiteers who have been allowed to act as a “party within a party.” That assertion was made yesterday by three Conservative MPs who resigned from the party in order to join the fledgling Independent Group in parliament.
He accepted that “there is a small hard core that have a very hard line view and are not likely to be flexible or to want to compromise,” but added, “No, they are not winning.”