Jacob Rees-Mogg leads Brexiteer revolt against Theresa May, accusing Government of 'failed' handling of EU talks

'The UK's approach to the EU talks has failed and must stop doing so,' leading Eurosceptic will say - in full-frontal challenge

Jacob Rees-Mogg will accuse the Prime Minister of being 'timid and cowering' (Getty)

Jacob Rees-Mogg has put himself at the head of a growing Brexiteer revolt against Theresa May, warning she has “failed” in her handling of the exit talks.

The Prime Minister will be accused of being “timid and cowering” and of planning to leave the UK “shackled to the EU”, in a speech to be delivered by the leading Eurosceptic.

Mr Rees-Mogg will say the benefits of Brexit are “at risk” from the Government’s intention to effectively stay in the EU single market and the customs union, even after a transition phase.

“The British people did not vote for that. They did not vote for the management of decline,” he will tell an audience in Hampshire, on Thursday evening.

“They voted for hope and opportunity and politicians must now deliver it.

“If we do not, if we are timid and cowering and terrified of the future, then our children and theirs will judge us in the balance and find us wanting.”

In a full-frontal attack, Mr Rees-Mogg, the chairman of the influential European Research Group of anti-EU Tories, would be sending out the message that "the UK's approach to the EU talks has failed and must stop doing so", an aide said.

The speech comes amid mounting evidence that Eurosceptic Tories are planning a revolt against Mrs May’s plans for a two-year transition, to cushion the impact of Brexit, fearing a sell-out.

The Prime Minister has accepted it will be “on current terms” and agreed to long-term “full alignment with EU rules”, if necessary to prevent a new hard Irish border.

Meanwhile, in Davos, the Chancellor risked a fresh outbreak of Tory Euro-wars by stepping up his push for a soft Brexit with a dramatic call for “very modest” changes to the UK’s trading rules with the EU.

Philip Hammond, in a speech to British business leaders, praised the call by the CBI employers’ organisation for the “closest possible relationship between the EU and the UK post-Brexit”.

Britain must not agree to anything that “throws away all the benefits we have of the complete alignment of our regulatory systems, the complete integration of our economies as the starting point of this negotiation”, he said.

A No 10 spokesman would not say if Mrs May agreed with her Chancellor’s stance, or whether the speech had been approved in advance.

But, speaking in Petersfield, Mr Rees Mogg will warn that the Brexit process, in Mrs May’s hands, is in danger of becoming “only a damage limitation exercise”.

“If we are timid and cowering and terrified of the future, then our children and theirs will judge us in the balance and find us wanting,” he will say.

And he will add: “’Close alignment’ means de facto the single market, it would make the UK a rule taker like Norway, divested of even the limited influence we current have.

“Conformity with EU rules will also prevent us from making meaningful trade deals with other nations.

“No sensible nation would negotiate with the UK for a marginal gain when we would merely be a vassal of the EU.”