U.K.’s Hammond in Diplomatic Push as Brexit Tension Mounts

  • Chancellor to Meet Germany’s Schaueble in bid to build EU ties
  • Tensions in government over prime minister’s divorce strategy

Chancellor of the Exchequer Philip Hammond has embarked on a diplomatic push before Britain starts formal talks to leave the European Union amid reignited speculation of a hard Brexit.

Hammond will hold talks with German Finance Minister Wolfgang Schauble in Berlin Tuesday, a day after he met his Irish counterpart Michael Noonan, as concern mounts that Britain will leave the single market, Treasury officials said. The former foreign secretary will also attend a conference on the challenges facing Europe with Chancellor Angela Merkel and European Parliament President Martin Schulz.

Prime Minister Theresa May has been criticized by opposition lawmakers and business groups for failing to set out the government’s strategy for leaving the 28-nation bloc. She signaled on Sunday that curbing immigration is a higher priority than remaining in the single market, sending the pound to a 10-week low.

Criticism of May comes after tensions were exposed within her government and the resignation last week of Ivan Rogers, Britain’s ambassador to the EU, who accused the prime minister’s office of excluding key civil servants from preparations and of "muddled thinking" over Brexit.

The chancellor, who favors a gradual exit from the bloc, is seeking to strengthen ties with European counterparts ahead of what promise to be difficult negotiations. The U.K. plans to trigger Article 50 of the Lisbon Treaty by the end of March, firing the starting gun for two years of talks.

‘New Relationship’

May said on Monday that she does not recognize the terms "hard" and "soft" Brexit and is seeking a "new relationship" with the EU that has trade at its heart.

The reluctance of the prime minister’s office to share details of her thinking has also sparked concern. Hammond and Brexit Secretary David Davis have been meeting regularly to seek common ground on strategy amid anxiety at a lack of consensus in government and a shortage of information about May’s plans, according to officials who asked not to be identified because the talks are private.

Short Notice

May’s office was only informed shortly before Hammond’s appearance at a parliamentary committee last month that the chancellor would suggest a transition period to ease Britain’s exit from the bloc. The officials said there was concern that the premier’s aides would seek to stop Hammond floating the proposal, which was favorably received by Davis.

Education Secretary Justine Greening offered a glimpse of May’s “hands-on” approach to Brexit preparations in an interview on Sunday. May, who has a growing reputation among ministers and civil servants for her eagerness to be involved in policy detail, has personally overseen discussions on the issues, Greening said.

“She’s worked through methodically with cabinet colleagues the many, many areas we have to have clear thinking in place on,” Greening said in an interview with BBC TV. “The prime minister will take her own decision about how much she wants to disclose.”

Hammond said in a statement Monday that he and Noonan discussed how to maintain “the closest possible economic relationship” after Brexit.  Two-way trade between the two nations was almost 44 billion pounds ($54 billion) in 2015, according to U.K. government figures.

“The unique relationship between Ireland and the U.K. has never been more important or as complex," Hammond said. “Trade between our two countries benefits each nation enormously and supports hundreds of thousands of jobs, so it is in everyone’s interest to build upon our strong ties."

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