THERESA May will today offer the EU a Brexit grand bargain – two more years of money and abiding by its laws in exchange for complete freedom and a jumbo trade deal afterwards.

The PM will unveil the offer – revealed in detail by The Sun today - in a landmark speech in the Italian city of Florence.

6 Theresa May to offer EU two more years of money and laws in exchange for complete freedom and a jumbo trade deal afterwards Credit: AP

It is her bid to break the deadlock in exit talks, as well as the result of a major compromise deal between factions in her Cabinet who have been warring all summer.

Under Mrs May’s fresh master plan:

She will ask for a two year transition period beginning on Brexit Day, March 30 2019,

Through out the two years, Britain is prepared to pay £20bn in continuing contributions to fill the huge hole in the EU’s budget from our departure,

Controversially, the PM will also agree to sign up to all current EU laws and regulations for the two year transition period, but NO fresh ones,

EU migrants will still be free to come to Britain during the transition period in exchange for continuing single market access, but will lose the right to stay indefinitely,

But when the transition ends, she will in return expect the EU’s 27 leaders to offer up a blockbuster free trade deal.

Mrs May will also today reject outright attempts by some ministers and Whitehall mandarins to permanently align the UK with the EU’s laws – known as an EEA-style arrangement – when the transition period ends in 2021.

6 She will make the landmark speech in Florence on Friday afternoon Credit: Corbis

Britain will then also be totally free to sign and implement any new trade deals with fast-growing countries across the world.

As part of the PM’s vision for a future relationship deal, she will also propose a “special partnership” in the key areas of defence and security – where the UK is a world leader and its military and intelligence help are highly prized.

Calling on the EU to accept her compromise plan, Mrs May will say today that Brexit negotiations “will be remembered not for the differences we faced, but for the vision we showed”.

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She will add: “The eyes of the world are on us but if we can be imaginative and creative about the way we establish this new relationship, we can be optimistic about the future we can build for the United Kingdom and for the European Union”.

The PM’s big offer also brings together the two bitterly feuding camps among her most senior ministers.

It satisfies the demands of ‘Clean Brexiteers’ lead by Foreign Secretary Boris Johnson and International Trade Secretary Liam Fox for an EU exit that eventually sees Britain regain complete control of its laws, borders and money.

6 It comes after Boris Johnson launched his own Brexit blueprint Credit: AP

And it also appeases Soft Brexit-backers lead by Chancellor Philip Hammond and Home Secretary Amber Rudd, who have pushed for a long transition over fears a sudden cliff edge exit would spark a business and jobs exodus.

The peace deal was effectively sealed by Boris and Mr Hammond symbolically leaving No10 together yesterday lunchtime, smiling for waiting TV cameras.

The choreographed move – thought up by the Chancellor as an important display of unity – came after a marathon two and a half hour Cabinet meeting in No10 where Mrs May won agreement for her plan from her whole top table, one by one.

Mrs May’s speech is a passionate attempt to go above Brussels chiefs’ heads tomorrow and make a direct appeal to the EU’s other 27 leaders.

6 Philip Hammond and Boris Johnson were seen leaving Downing Street together after the Tory rows on Brexit Credit: EPA

6 European Commission President Jean-Claude Juncker still believes that Brexit will be 'tragic' for Britain as the EU has the wind in its sails Credit: Reuters

Downing Street were last night braced for an initially frosty response from the EU to her grand bargain offer.

The EU Commission’s chief negotiator Michel Barnier unleashed his own broadside yesterday to urge the UK to come up with more answers to satisfy his exit demands when the fourth round of Brexit talks begins in Brussels next Monday.

Accusing No10 of wasting six months since Mrs May triggered Article 50 exit talks in March, Mr Barnier said: “I 'm wondering why – beyond the progress we've made on certain points – there is still today major uncertainty on each of the key issues of the first phase”.

6 EU Commission’s chief negotiator Michel Barnier has demanded that Britain is clearer on its position with Brexit, which Theresa May will set clear during her Florence speech Credit: AFP or licensors

But a senior government source argued last night: “This is a negotiation, we don’t expect the EU to roll over immediately.

“What the PM will do in Florence is give them something very substantial to chew over and puts the ball quite deeply back in their court.”

Other government figures were more downbeat about the Premier’s grand plan, instead calling it “a bit of a fudge".

The figure added: “All we’re really doing is kicking the ball down the road for two more years to buy ourselves more time”.

Aides said the PM chose the Renaissance city of Florence to give her speech to signify her respect for Europe’s world-dominating culture, as well as its history as an ancient city kingdom that got rich from free trade.

She will deliver it in the world famous Santa Maria Novella, the city’s first great basilica.

Some Tory Eurosceptics were unhappy with paying any more into Brussels coffers after we leave.

Eurosceptic Tory MP Peter Bone said: “Giving billions and billions of pounds to the EU after we come out? What are the public going to say to that?”

But leading Brexiteer Bernard Jenkin was one of the senior Tory backbenchers invited into No10 yesterday afternoon to be briefed on the speech.

Leaving Downing Street content, Mr Jenkin told The Sun: “I am hopeful there will now be some unity in the Cabinet and the squabbling will stop”.