Tuesday 18 December 2018 2:38 pm

Government ramps up planning for ‘no-deal’ Brexit

Reporter at City A.M. covering City politics, transport and law. Get in touch: alexandra.rogers@cityam.com

Reporter at City A.M. covering City politics, transport and law. Get in touch: alexandra.rogers@cityam.com

The government is to implement its no-deal plans "in full" after cabinet agreed it should be the top priority in light of the uncertainty surrounding Theresa May's deal.

Downing Street confirmed that cabinet ministers' respective departments would be expected to make no-deal planning their main priority, with departments such as the Home Office and the Department for Environment, Food and Rural Affairs receiving a £2bn contingency fund.

Businesses – which have long warned against no deal – are to receive advice on how to prepare if the UK leaves the EU without a deal on 29 March next year.

Earlier today Brexit secretary Steven Barclay said the government's priority was to secure a deal, but "alongside that, as part of out continuation of preparing for no deal, a responsible government needs to ensure we are ready for that default option, which we don't want to happen, but we're ready in the event it did happen".

"At Cabinet today we agreed that preparing for no-deal will be an operational priority within government, but our overall priority remains to secure a deal."

Barclay said government was already communicating with pharmaceutical firms and EU citizens living in the UK about a no-deal Brexit, but that there would be an increase in the "tempo" of such talks in the coming weeks.

Yesterday Labour tabled a vote of no confidence in the Prime Minister after she confirmed that she would hold a vote on her Brexit deal on 14 January.

On Monday Labour party leader Jeremy Corbyn branded May's decision to call off last week's vote on the deal as "unacceptable". He said the move had plunged the UK into a "national crisis".

Meanwhile, member of the European Parliament Guy Verhofstadt hit out at Jeremy Hunt for "glorifying" a no deal, after the foreign secretary said at the end of last week that while such an exit from the EU would cause disruption, Britain would still "flourish and prosper". 

Verhofstadt said there was no such thing as a "managed no deal".

Pressure has increased on the Prime Minister in the last week after her disastrous EU summit, in which her efforts to secure legal assurances on the temporary nature of the Irish backstop, the main sticking point in the negotiations, failed ot materialise.