Brexit: Philip Hammond seeks to win over DUP rebels as May heads to crunch EU summit

Arlene Foster says the PM's Brexit deal is worse for the UK than a Labour government

Philip Hammond has sought to calm the fears of DUP Brexit rebels as Theresa May heads to Brussels with her deal under threat from all sides.

DUP leader Arlene Foster, whose party props up the government, indicated she was prepared to ally with Labour to thwart the prime minister’s Brexit blueprint, which she said was worse for the UK than a Jeremy Corbyn-led government.

Ms Foster will tell her party faithful that the draft deal is not in Northern Ireland's long-term interests when DUP members gather in Belfast for their annual conference on Saturday, where Ms May's rival, Boris Johnson is due to make a star appearance.

The prime minister will hold last-minute talks with European Commission president Jean-Claude Juncker and European Council president Donald Tusk before a summit of EU leaders on Sunday which is expected to endorse her agreement.

However she faces tensions over the future of Gibraltar, as Spain's prime minister Pedro Sanches has threatened to "veto" the deal without further guarantees.

Speaking ahead of the summit, Mr Hammond appealed to MPs to support the deal, which he said was better for the UK than remaining in the EU because it would help heal the divisions in the country.

The chancellor told BBC Radio 4’s Today programme: “The DUP has understandable concerns about anything which proposes solutions - even if they are very unlikely to ever have to be brought into effect - where there would be any kind of difference in treatment between Northern Ireland and the rest of the UK.

“I absolutely understand those concerns and it’s our job to reassure them, firstly that we are never likely to get into that situation and secondly that we have done everything we possibly can to minimise any difference there would be during any temporary backstop period and that it could only ever be a temporary period.”

Mr Hammond warned that a no-deal Brexit would unleash "economic chaos", adding: "If the meaningful vote is lost we are in uncharted territory.

"We will be faced with potential economic chaos, I am sure we would get a very negative reaction from the business community, from investors, from the markets.”

In a sign of the significance of the DUP support, Mr Hammond flew to Belfast on Friday to woo senior figures and Northern Ireland business leaders.

The DUP has threatened to torpedo the confidence and supply agreement it has with Ms May over their opposition to her Brexit deal, a move which could bring down the government.

The 10 unionist MPs have been flexing their muscles by refusing to vote with the government on key budget votes.

Sajid Javid, the home secretary, was also forced to water down proposals to prohibit .50 or higher calibre rifles in the long-awaited Offensive Weapons Bill, due to pressure from DUP and Tory MPs.

Asked by The Times if the PM's deal was a greater threat than a Labour government, Ms Foster said: "I think it is, and the reason I say that is on day one of us leaving the European Union there would be no difference, we would be exactly the same as the rest of the UK but in year five or ten we would be different."

Shadow home secretary Diane Abbott also refused to rule out an alliance with the DUP, despite longstanding differences between the parties.

Ms Abbott told the BBC's Political Thinking podcast: "We would only want to ally with a group of MPs who agreed with us on the issues at stake.

"At this point, we don't agree with the DUP on the issues at stake, but in this sort of parliamentary turmoil you can't necessarily rule anything out.

"I always say to my MP colleagues that the people of Hackney send me to parliament to get rid of the Tories and if it's all about getting rid of this Tory government you do what it takes."