Downing Street rejects the Treasury’s proposal to end Cabinet row, temporarily keep UK in EU Customs Union after Brexit
Philip Hammond hoped his plan to keep the country in the EU's Customs Union until we could finalise our own trade deals might end Tory infighting, but the PM dismissed him
A TREASURY compromise bid to end a raging Cabinet row over an EU free trade deal has been shot down by No10.
Under pressure from Brexiteers, Downing Street dismissed the pitch - backed by Philip Hammond - to keep elements of the EU’s Customs Union for a few years after Brexit and its transition period.
Under the officials’ plan, Britain would only fully leave the key Brussels institution once new trade deals are signed.
That may take many years, leaving the UK suffering a disastrous drop in trade once EU barriers go up in the meantime.
A senior Treasury source told The Sun it meant pro-Brexit Cabinet ministers Boris Johnson and Liam Fox would eventually see “their great prize”.
The source added: “They just have to be patient for a few more years and then their prize is there for them”.
But Downing Street aides insisted the PM would not be going ahead with the plan.
The PM’s official spokesman said of it: “This is not something I recognise”.
Ruling out any half way house, he added: “It is not government policy to be members of “the” customs union or a customs union”.
Brexit Secretary David Davis is also blocking it, saying it would look awful to voters at the 2022 general election if the UK is still following some EU rules six years after the Brexit referendum.
A source close to Mr Davis said: “There is a general election coming up, so we cannot still be half-in. What do we tell voters?
“It would also be impossible to negotiate with the EU.”
News of the plan came ahead of two marathon sessions of the Cabinet Brexit committee on Wednesday and Thursday to try to nail down Britain demands for a trade deal after months of dithering.
But it emerged yesterday that the PM will not ask them to come to a decision this week and delay that until a third meeting next week at the earliest.
With frustrating mounting with Mrs May on all sides, arch Brexiteer and Tory grandee Lord Lawson lashed out at her for being weak.
The ex-Chancellor insisted she should “get up off her knees and stop this cringing attitude towards the European Union and get herself sorted”.
Pro-EU former deputy PM Nick Clegg said Mrs May’s position meant “the illusion of a so-called soft Brexit has died”.
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The former Lib Dem leader added: “It was always a nonsense in my view, but there was a feeling that maybe Theresa May would pluck up courage that she’s never displayed hitherto to defy her right-wing.
“There was a slight sense that she was starting to realise the error of her preemptive declaration of red lines, [that this] was going to lead her to try and sue for peace on an emollient basis.
“I think that’s now gone. I think it was always unlikely but it’s now gone. I think it is more likely than not that the Government will win the day.”