Philip Hammond to soothe City's Brexit fears at private dinner

Helen Cahill
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The government is starting to reach out to businesses more over Brexit (Source: Getty)

Chancellor Philip Hammond will attempt to soothe City concerns about the government's Brexit strategy today, after reports of a possible walk-out in future negotiations with the EU raised alarm across the business community.

At a private dinner organised by the Confederation of British Industry (CBI) this evening, Hammond will seek to reassure a select gathering of the UK's chief executives that he is listening to their needs, and will reiterate his commitment to delivering a Brexit deal that prioritises the economy.

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In the closed session, he will press them to show their loyalty to the UK, and ask them not to put off their investment plans, according to Bloomberg.

He will also ask them to take advantage of the opportunities presented by Brexit by seeking contracts outside of the EU.

The meeting comes ahead of a separate summit of top bosses at Number 10, expected to take place before parliament takes a summer recess.

Business leaders will be looking for further assurances after a briefing leaked to the Sunday Telegraph showed how businesses were warned that Prime Minister Theresa May could storm out of EU negotiations over the so-called "Brexit bill".

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The high level meetings follow ministers' recent promises that the government will engage more with business. In the Queen's Speech, the government stressed it will consult more with businesses to "test and validate" its Brexit approach, a rapprochement that won the approval of City lobby groups including the CBI and the Institute of Directors, which called the move a "welcome change of tone".

The government has already announced plans for an advisory panel comprising business lobby groups as it scrambles to tap into industry thinking on how to navigate Brexit negotiations.

The founding of the group, which will be led by Hammond, business secretary Greg Clark and Brexit secretary David Davis, was seen as a government drive to calm criticism that it had been sidelining businesses.

Hammond has emerged as the main cheerleader for a business-friendly Brexit after Prime Minister Theresa May’s dismal election performance saved his place in the Cabinet and put May under pressure to rethink her approach.

Last week, divisions in the government's Brexit strategy were laid bare, as Davis publicly clashed with Hammond over the length of a possible transitional trade deal.

Speaking in London, Davis accused the chancellor of making statements on future transition arrangements that were "not quite consistent with each other".

Hammond is pressing for a transition period lasting up to four years to protect businesses from a "cliff edge".

Although he has agreed on the need for an implementation phase for a "smooth and orderly glide path" to Brexit, Davis has argued the transition should end by 2022, in time for the next General Election.

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