05/08/2018 18:35 BST | Updated 06/08/2018 10:33 BST

Labour Warns 'No Deal' Brexit Would Be 'Catastrophic' As Liam Fox Blames EU For Stalemate

International Trade Secretary puts chances of failure to reach agreement at 60-40.

Labour has warned a ‘no deal’ Brexit would be “catastrophic” after Cabinet minister Liam Fox put the chances of failure to reach agreement with Brussels at 60-40.

The International Trade Secretary blamed the “intransigence” of the European Union for the impasse in Brexit talks.

The prominent Brexiteer said he believed the risk of a ‘no deal; scenario had increased, pinning the blame on the European Commission and Brussels’ chief negotiator Michel Barnier.

Fox has previously declared that a trade deal with the EU would be “one of the easiest in human history”.

But shadow Brexit secretary Sir Keir Starmer said Prime Minister Theresa May’s “reckless red lines” had contributed to the difficulties, along with splits in the Tory ranks and “fantasy Brexiteer promises”.

He indicated that Parliament should step in to prevent the UK crashing out without a deal.

“No deal would be a catastrophic failure of government, which no government should survive,” he said.

“The cause: PM’s reckless red lines, Tory divisions & fantasy Brexiteer promises. Parliament has a duty to prevent it.” 

PA Wire/PA Images
Liam Fox told the Sunday Times: 'I think the intransigence of the commission is pushing us towards no deal'

Pro-EU Tories suggested that remaining in the single market was the best way to resolve the situation after the rejection of May’s Chequers blueprint by Brussels.

Former Cabinet minister Nicky Morgan said keeping the UK in the single market as part of the European Economic Area (EEA) or European Free Trade Association was “clearly (the) right option” adding “will PM move that way or does Parliament have to force issue?”

Former minister George Freeman said that after the “failure of the 2016-18 Brexit Cabinet to plan, prepare for and negotiate a sensible, smooth and pro-business bespoke Brexit” more Tories were coming round to the view that an EEA/EFTA solution was necessary.

Fox used a Sunday Times interview to give his pessimistic assessment of the negotiations.

“I think the intransigence of the commission is pushing us towards no deal,” he said.

“We have set out the basis in which a deal can happen but if the EU decides that the theological obsession of the unelected is to take priority over the economic wellbeing of the people of Europe then it’s a bureaucrats’ Brexit – not a people’s Brexit – then there is only going to be one outcome.”

He said Barnier had dismissed the UK’s proposals in the Chequers plan thrashed out by May and the Cabinet simply because “we have never done it before”.

The Government has admitted its proposals are unprecedented, but Fox said Barnier’s response “makes the chance of no deal greater”.

The Prime Minister held talks with French President Emmanuel Macron on Friday, cutting short her holiday to visit his summer retreat.

And ministers including Foreign Secretary Jeremy Hunt and Brexit Secretary Dominic Raab have also engaged in diplomatic activity in Europe in recent days as the Government seeks to deal directly with individual governments in an effort to keep the Chequers plan alive.

In a sign that member states are being warned of the consequences of the failure to find a deal, Fox said: “It’s up to the EU27 to determine whether they want the EU Commission’s ideological purity to be maintained at the expense of their real economies.”

Meanwhile, former cabinet minister Priti Patel said May must ditch the Chequers plan, which would see a “common rulebook” for goods with the EU – effectively tying the UK to terms set by Brussels.

Writing for the Telegraph website she said it did not meet the result of the referendum and “will leave us half-in and half-out, still bound to EU regulations and constraints”.

Calling for a looser free trade deal with the EU she said the change would take “political courage, the kind of courage that appears to have been lacking over the past two years”.

Labour former cabinet minister Lord Blunkett used a Sunday Telegraph article to reject claims that people who voted to Leave over immigration concerns were “racist” and said the result would be the same if there was another referendum.

He argued that “people believed our democracy and political system did not reflect their concerns and their cry for help” following the impact of the financial crash and austerity, in many places hitting communities still coping with the aftermath of de-industrialisation.

“To understand this, and why, if there were to be a second referendum now, I believe that the majority would still vote to leave, is critical if we are to get our democratic system back on track,” he said.