Downing Street has hit back at claims it has a “fantasy” approach to Brexit negotiations.
Prime Minister Theresa May’s chief Europe adviser Olly Robbins praised Government efforts after reports a senior EU official had branded the UK’s stance unrealistic.
Mr Robbins insisted that Britain has presented its case “calmly and professionally” during talks with Brussels.
The PM’s key Brexit adviser tweeted: “Very proud of the x-Government team that worked so hard to support technical talks in Brussels this week.
“UK proposals for a deep relationship, calmly and professionally presented.”
The move followed reports that a senior EU official insisted Britain must accept the “consequences” of its decision to quit the bloc and abandon the “fantasy” that things would remain the same.
The increase in tension emerged after the UK made clear it would seek a return of £1 billion in funding it has put into the Galileo satellite system if the EU continued to shut Britain out of key aspects of the project post-Brexit.
The spat also came as Bank of England governor Mark Carney said a “disorderly” Brexit transition period may trigger a cut in interest rates, or force a pumping of money into the economy, in order to stabilise the situation.
The UK central bank’s current projections are based on a smooth transition when Britain leaves the European Union, he said in a speech on Thursday, before warning that “a sharper Brexit could put monetary policy on a different path”.
Addressing the Society of Professional Economists, he said that if that happened, the Bank’s Monetary Policy Committee (MPC) would face “a trade-off between the speed with which it returns inflation to target and the support policy provides to jobs and activity”.
Earlier this week, Mr Carney said Brexit has knocked real household incomes by around £900, and lowered growth by “up to 2%” against what the Bank of England had expected in 2016 if the UK had voted to remain in the EU.