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Failure to reach Brexit deal would be very bad for Britain, warns Chancellor

The Chancellor’s warnings over Brexit were seized on by critics.

Philip Hammond has warned failing to secure a Brexit deal would be “very, very bad” for Britain ahead of the start of exit talks in Brussels on Monday.

The Chancellor insisted there must be transitional arrangements to avoid a “cliff edge”, and he indicated temporary measures could be in place for a couple of years before a final deal is sealed.

Brexit Secretary David Davis is heading to Brussels for a one-day meeting with its chief negotiator Michel Barnier to start formal negotiations.

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( Jeff Overs/BBC/PA)

Prime Minister Theresa May has repeatedly insisted the Government is prepared to walk away from the talks, claiming no deal is better than a bad deal.

Mr Hammond’s warnings over Brexit were seized on by critics, with shadow chancellor John McDonnell claiming the Government is in “disarray”.

The Chancellor told BBC One’s Andrew Marr Show: “What we put in place may not be a single arrangement that endures forever, it may be an arrangement which lasts for a couple of years as a temporary measure before we get to the long-term agreed status quo.

“We’re leaving the EU and because we are leaving the EU, we will be leaving the single market and by the way, we will be leaving the customs union.

“The question is not whether we are leaving the customs union. The question is what do we put in its place in order to deliver the objectives the Prime Minister set out in her Lancaster House speech of having no hard land border in Ireland and enabling British goods to flow freely backwards and forwards across the border with the European Union?

“It’s a statement of common sense that if we are going to radically change the way we work together, we need to get there via a slope, not a cliff edge.”

Mr Hammond said he would not agree to a deal that would “destroy” Britain.

“No deal would be a very, very bad outcome for Britain, but there is a possible worse outcome and that is a deal that is deliberately structured to suck the lifeblood out of our economy over a period of time.”

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