The Government will keep spending money on contingency plans for a no deal Brexit until shortly before the planned withdrawal date of March 29 2019, in case a proposed transition deal falls through, David Davis has said.
Even if political agreement on the transition is reached at this month’s European Council summit, Mr Davis said that preparations for a no-deal outcome must continue until the plan is formally ratified probably in the final weeks of this year.
His comment appears to put him at odds with Chancellor Philip Hammond, who told the Commons European Scrutiny Committee on Monday he expected to be able to stand down preparations for a no deal Brexit once the transition deal is agreed.
Crashing out without a deal in March 2019 would probably require significant investment, whether on additional customs officials or lorry parks at ports.
A transition deal would ease the pressure by giving businesses and authorities about two years to prepare for an orderly departure.
But Mr Davis told the European Scrutiny Committee that the Government could not take for granted that a deal reached with the other 27 EU member-states in Brussels would come into effect as planned.
It would not be possible to stand down contingency preparations until we have got to the point of agreement later in the year, he said.
It’s highly improbable, but always possible, that the deal will come apart at the end for some wholly unpredictable reason.