Brexit: Theresa May admits she could cave in to Labour demands to stay in customs union

Prime minister’s spokesperson refuses four times to rule out the concession – which would enrage Brexiteer Tories

Theresa May has admitted she could agree to stay in a customs union in a bid to rescue Brexit, saying she “can’t pre-empt” the result of the talks with Labour.

The prime minister’s spokesperson refused – four times – to rule out the concession, which would enrage many Conservative MPs and almost certainly trigger cabinet resignations.

“I can’t pre-empt what will come out of talks,” he said, asked if Ms May was prepared to agree to the central demand made by Jeremy Corbyn.

Asked if she was still committed to an “independent trade policy” – which would be impossible inside a customs union – the spokesperson replied: “You can’t predict where we will get to, we will have to wait and see.”

The comments come after the likely climbdown necessary to strike a compromise deal were laid bare at cabinet – stoking the fears of Brexiteer Tories.

In a stark analysis, Julian Smith, the government’s chief whip, warned there was no chance of a deal passing without Labour’s support – and that the government could be “sunk” if it tried.

“It’s a customs union or a second referendum and we are not having a second referendum,” Mr Smith was reported to have told Tuesday’s cabinet meeting.

Asked if Ms May was still ruling out a customs union, her spokesperson repeatedly refused to give the guarantee, saying only: “You know her views on this issue.

“We continue to think what we have negotiated gives us the benefit of a customs union, while allowing the UK to have an independent trade policy.”

The spokesperson added that “compromise on both sides” would be needed if the cross-party talks, which resumed this week, were to succeed.

The comments come after the prime minister bowed to pressure to finally set a deadline for ending the talks with Labour next week, unless a deal is in sight.

If Labour agrees not to block the withdrawal agreement bill, it would then be put to the Commons, but the government will “move in another direction” if no guarantee is given, the source said.

That was interpreted as a likely shift back to trying to win the backing of the Democratic Unionist Party – but yet mean further concessions to Mr Corbyn’s party.

Such a shift would also alarm many Labour MPs, after their leader crushed an attempt to commit the party to a second Brexit referendum in all circumstances.

He defeated a bid – led by his deputy Tom Watson – to end the “fudge” that would mean no public vote if the party’s “alternative plan” wins support at parliament.

It leaves open the possibility of Labour helping to force through EU withdrawal, if the Conservatives concede a customs union and demands on the single market, plus worker and environmental rights – without a public vote.

However, many doubt Mr Corbyn would split his party to make that deal – and it could struggle to win a Commons majority if more Tories refuse to vote for it.