Philip Hammond wants to bring Brexit process to a ‘standstill’ until 2022, incensing Brexit-backing Cabinet members who are out of the country
The Chancellor suggested our relationship with the EU will look the same for three years after Brexit
THE CHANCELLOR incensed Brexit backers yesterday by demanding a “standstill” transition deal with the EU to avoid empty supermarket shelves and economic chaos.
Philip Hammond declared that “literally nobody” wanted to see a dramatic fall in migration immediately after Brexit in March 2019.
He seized on the absence of Theresa May - who is on holiday in Italy - to push his agenda for a long transition after Brexit.
Mrs Hammond said it would be "rational" for Britain to continue following EU regulations for two or three years after we leave in March 2019, to avoid disrupting trade.
The Chancellor told BBC Radio 4's Today programme: "There's going to have a period where we move rationally from membership of the European Union.
"How we get from A to B is the crucial question - the point is, the first day after we leave the European Union many things will look similar.
"In the immediate aftermath of leaving the European Union, goods will continue to flow across the border in much the same way as they do now."
He insisted that Britain would quit the single market and customs union in 2019 - but admitted it would be impossible to control migration for several years.
Mr Hammond said: "We've been clear that it will be some time before we are able to introduce full migration controls between the UK and the European Union.
"That's not a matter of opinion, that's a matter of fact.
"During the transition period that will follow our departure from the European Union, European citizens will still be able to come here but they will have to register."
He confirmed that EU migrants will be free to work in Britain during the transition period and claimed that our public services would collapse without foreign staff.
Mr Hammond said: "At the present time, we have a high level of dependence on foreign workers in the UK.
"Nobody wants us to go over a cliff edge in March 2019 where suddenly our health services are unable to cope, social care is unable to deliver."
Yesterday the Immigration Minister admitted that the continued influx of migrants from Europe would stop the Government hitting its target for immigration below 100,000 for the next five years.
Asked how long the transition could last, the Chancellor replied: "People have talked about a year, two years, maybe three years.
"I think there's a broad consensus this agreement has to be completed by the time of the scheduled next election in June 2022, so a maximum of three years."
He ruled out submitting to the authority of European judges, but suggested a neutral panel could be set up to rule on disputes between Britain and the EU.
Mr Hammond refused to deny reports that he told business figures he is keen for a transition period which would result in a Brexit "standstill".
He told bosses he wants to negotiate an "off-the-shelf" transition agreement with the EU, followed by another delay as the new trade deal comes into full effect, the Financial Times reported.
The Chancellor apparently believes it would be simpler to maintain current relations with Brussels while striking a new settlement on trade, rather than trying to negotiate a separate legal regime which would govern the transition.
The comments – with Mrs May on holiday and Brexit Ministers such as Liam Fox out the country – infuriated hard-core Eurosceptic Tories but delighted pro-EU Labour big hitters.
Tory MP Andrew Rosindell said: “The appearance will be that Brexit will not actually mean Brexit.”
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Livid Tories said they feared ‘liberal’ Ministers would simply decide at the end of a transition phase to strike another similar extension that keeps the UK tied to Europe.
One senior Tory told the Sun the Chancellor risked “dividing” the Tories still further.
And they said it was a strike against Theresa May’s authority – given plans for a big Brexit speech by the PM when Parliament returns in September.
Critics pointed to the huge difference in tone to Boris Johnson – who lauded Brexit Britain’s potential in a speech in Australia on Thursday.
Speaking in Sydney he said it was rubbish to say Britain was “too small, too feeble, too isolated” to cope on its own.
And he told his audience: “They say the UK is like some poor wriggling crustacean about to be deprived of its shell. I say – don’t come the raw prawn with me.”
But the Chancellor insisted there was “broad agreement” across the Cabinet for what he was saying.
Labour’s pro-EU MP Chuka Ummuna lauded the Chancellor for bringing a “welcome dose of reality” to the Brexit debate.
Labour Shadow Brexit Secretary Keir Starmer said: “Labour has been calling on the Government to commit to appropriate transitional arrangements for a long time.
“The Chancellor now appears to accept this.
“However in light of the clear divisions this week within the Cabinet, I hope the Chancellor was not merely speaking in a personal capacity.”