The UK and EU have given contrasting assessments of the chances of a Brexit trade agreement with Michael Gove suggesting it was “more likely” there would be no deal.
But time is running out to finalise an agreement by January 1 to avoid the UK defaulting to no deal World Trade Organisation terms for trade with the EU, predicted to be the most damaging outcome.
Despite a sense of optimism in recent days, Gove said the chances of a deal are now “less than 50%”.
The Cabinet Office minister also said the “most likely outcome” was that the current transition period would end on December 31 without a deal.
“I think, regrettably, the chances are more likely that we won’t secure an agreement. So at the moment less than 50%,” he told the Commons Brexit committee.
But he appeared at odds with EU chief negotiator Michel Barnier, who described “good progress” in the talks with his opposite number from the UK, Lord Frost, while acknowledging the “last stumbling blocks remain”.
Barnier briefed European Parliament leaders about the state of the talks, which he said were in the “final stretch”.
He said: “We will only sign a deal protecting EU interests and principles.”
Gove similarly spoke of protecting the principles that people voted for in the 2016 EU referendum, with talks thought to be stuck on the issues of how much the UK and Brussels match each other’s standards, and punishments for divergence, as well as fishing rights.
“The process of negotiation has managed to narrow down areas of difference,” the Tory minister said.
“It is certainly the case that there are fewer areas of difference now than there were in October or indeed July.
“The areas of difference are still significant and they do go to the very heart of the mandate which the country gave the government in 2016.”
Gove also ruled out returning to negotiations in 2021 if no deal could be reached by the end of the year.
December 31 was a “fixed point in law,” when the transition must end, he said.
“That would be it. We would have left on WTO terms.
“It is still the case of course that there would be contact between the UK and European nations and politicians as one would expect.
“But what we would not be doing is attempting to negotiate a new deal.”
The Commons breaks up on Thursday for Christmas recess but MPs have been put on notice that they may be recalled to ratify any Brexit deal.
The European Parliament has also said it will refuse to debate anything that is agreed after this Sunday.
But Downing Street said it would not be necessary to require MPs to sit on Christmas Day.
“Obviously we wouldn’t be looking for the House to sit on Christmas Day and the bank holidays around it. We would obviously try to avoid those days,” the prime minister’s official spokesperson said.