PM declines to tell businesses to stop preparing for no-deal Brexit at end of 2020

Boris Johnson has left the door open to coming out of the EU on World Trade Organization terms next year, after his foreign secretary, Dominic Raab, said it was “absolutely” right to keep a no-deal outcome on the table in trade talks.

The prime minister was grilled about Raab’s statement after his cabinet minister appeared to let slip the government’s negotiating plans in an interview on BBC Radio 4’s Today programme on Tuesday.

Johnson shook his head as it was mentioned but then three times declined the opportunity to refute Raab’s position or to tell businesses to stop theirno-deal planning.

Asked if businesses should continue spending money getting ready for no deal, he said: “We have a great deal. It’s going to allow us to come out smoothly and efficiently on 31 January.”

Brexit voters more likely to live in areas at risk from rise of robots Read more

Pressed that it was actually 31 December 2020 when the danger of no deal occurs, he simply repeated: “We have a great deal that will allow us to come out of the EU smoothly.”

Asked again whether he would advise companies to cease no-deal preparations, he parroted the same line: “We have a great deal which will allow us to come out smoothly, efficiently, seamlessly on 31 January.”

Johnson’s words will fuel suspicion that the prime minister still intends to use the threat of leaving transitional arrangements on World Trade Organization terms at the end of 2020 as leverage in trade talks with the EU.

Last week, he defended the continuation of no-deal preparations, saying they were “thoroughly useful in many ways” and arguing that it was right for businesses to “keep in a state of readiness”.

The prime minister has repeatedly stressed that he believes a trade agreement with the EU can be done by the end of 2020 and the Tory manifesto commits to ending transitional arrangements at that point. However, it is becoming increasingly clear that he is also not ruling out leaving on WTO terms if no deal has been done, rather than extending the transition period.

Both Philip Hammond and David Gauke, two former Treasury ministers who were kicked out of the party by Johnson, have warned that the UK could sleepwalk towards a no-deal Brexit in 2020 despite the prime minister having secured a withdrawal agreement.

At the time of the last vote on Johnson’s deal, John Baron, a member of the European Research Group (ERG), appeared to claim that two cabinet ministers – Michael Gove and Dominic Raab – had told him that a no-deal exit was possible if trade talks failed.

Johnson wriggled over the questions about a no-deal Brexit as he appeared at a veterans’ facility in Salisbury in Wiltshire.

One veteran, Paul O’Rourke, who had been living in a tent before entering the accommodation, pointed out that the prime minister had dandruff. Johnson laughed it off, saying he had “got to watch that”.

He later visited a Christmas market in the safe Tory seat of Salisbury, arriving to a mixture of cheers and boos, where he bought some sausages and then had to ask an aide for some cash to purchase chocolate brownies.

There were also hecklers among the crowds, including some saying “Vote Labour”, “Shame on you” and “Tell me how many children you’ve got”. Johnson ignored the shouts, shaking hands with well-wishers and taking selfies with passers-by.

Earlier, he was repeatedly forced to deny again that he wanted to sell off the NHS to Trump as part of a trade deal and insisted that higher drug prices would not result from an agreement with the US.

Ahead of Wednesday’s Nato meeting near Watford, which Trump is attending, Johnson insisted he was not embarrassed to be seen with the US president at such a crucial time in the election campaign.

The pair met at Downing Street on Tuesday night. A No 10 statement said the leaders “welcomed the recent increases in defence spending by Nato member states and agreed on the need for the alliance to be unified in the face of new and evolving threats”. Johnson also updated the US president about the afternoon’s “meeting between France, Germany, Turkey and the UK to discuss the situation in Syria”.

The prime minister also appeared to be at odds with Trump on the issue of taxes on big internet companies, which have prompted the US to threaten trade tariffs on French sparkling wine, cheese and makeup.

Asked about the UK’s own plans for a digital sales tax on big internet companies, Johnson said: “Obviously I deplore, I don’t think trade wars are a good thing. One of the things the UK is going to do is campaign for … we will campaign for freer trade and make sure we will open up markets around the world for British goods and services.

“On the digital services tax, I do think we need to look at the operation of the big digital companies and the huge revenues they have in this country and the amount of tax that they pay. We need to sort that out. They need to make a fairer contribution.”