Philip Hammond: Brexit transitional deal will last three years 'at the most'

Posted On: 
28th July 2017

A transitional deal between the UK and the EU after Brexit should continue for no longer than three years after the withdrawal date, Chancellor Philip Hammond said today.

Chancellor Philip Hammond Chancellor Philip Hammond wants to avoid a so-called 'cliff edge' effect after Brexit
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The senior Conservative said there was a “broad acceptance” among Cabinet ministers that an interim deal would be needed to smooth the exit process.

But he warned that new trade agreements across the globe may have to be paused until the transitional period is over.

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Mr Hammond has moved to reassure business leaders who are worried about a ‘cliff edge’ effect on commerce and migration when Britain quits the bloc in March 2019.

He is thought to have won an argument in the Cabinet that an interim arrangement will be needed - with former sceptics such as Liam Fox now agreeing to a slow-burning, phased exit.

Mr Hammond told the Today programme this morning: “I think there’s a broad consensus that this process has to be completed by the scheduled time of the next general election, which is in June 2022.

“So a period of at the most three years in order to put these new arrangements in place and move us on a steady path without cliff edges from where we are today to the new long term relationship with the European Union.”

He admitted that "many things will look similar" on the day Britain quits the bloc but there will be a gradual shift as new arrangements are implemented.

And he said although Britain would be able to “get started” on striking free trade deals around the world after Brexit, those deals may have to be put on ice until the transitional time is over.

“It may be that during that period we don’t bring those new agreements into force - but it will take us time anyway to negotiate them,” Mr Hammond said.

Elsewhere he appeared to admit that the Government’s plans for a "registration and documentation" migration process after Brexit meant little more than collecting names.

“We’ll know who’s coming and who’s going,” he insisted.