Conservative activists are refusing to campaign for the party and donations have “dried up” because members feel that Theresa May has betrayed them over Brexit and the Government has “completely lost touch with voters”, council candidates have warned.

In a letter to the Prime Minister, more than 100 current and would-be Tory councillors state that they are unable to muster the volunteers needed to effectively fight next month’s local elections because “belief in the party they joined is gone”.

The stark warning came as Mrs May was forced to insist that she would maintain her pledge to take back control of the UK’s borders after Brexit, after Philip Hammond, the Chancellor, said the Government had “no red lines” in its talks with Jeremy Corbyn over a potential compromise Brexit deal.

Tory activists reacted with fury after Mrs May signalled last week that she could agree a deal involving remaining in a customs union with the EU – a move explicitly ruled out in her 2017 manifesto and which she has repeatedly insisted she could not countenance.

The two sides have also discussed putting a second referendum in a compromise deal to a vote of MPs.