Steve Baker who refused to accept a job in the Brexit department is set to be made chairman of the hardline European Research Group next month.

Mr Baker - who held the job before Mr Rees-Mogg - said that he will seek to replace him next month when MPs return to Parliament after their summer break.

Mr Baker's likely election to the role could be a headache for Boris Johnson if he seeks to bring back Theresa May's withdrawal agreement before Oct 31.

Mr Rees-Mogg insisted that there was "no conflict of interest" in him staying on as ERG chairman for a few weeks because the policies of the ERG and Government were aligned.

Mr Johnson has repeatedly stressed that he wants the European Union to agree to remove the 200 page long section covering the Northern Ireland backstop in Mrs May's Withdrawal Agreement to get the deal approved by MPs.

However this week ERG vice chairman Mark Francois said that Tory members of the ERG on the backbenches - now understood to be around 60 - would vote down any agreement.

Mr Rees-Mogg has been allowed to remain as chairman of the ERG even though he is now a Government minister after asking permission of the Cabinet Office, The Daily Telegraph can disclose.