Vince Cable has claimed that Theresa May’s attempt to reach out across the political divide is part of an attempt to create a “grand coalition” between the Conservatives and Labour to force through hard Brexit.

He told journalists that while Jeremy Corbyn would never take up a formal position in the Downing Street rose garden, there would be co-operation between the two main parties over the question of Britain’s EU exit.

“One interpretation that you can put on Theresa May’s reaching out yesterday was an attempt to create a very British kind of German grand coalition,” said Cable, who is almost certain to be named Liberal Democrat leader next week.

“Of course it is ludicrously implausible to imagine Mr Corbyn going to the rose garden and signing up as a deputy prime minister but nonetheless there is a coalition of interest on the big issue of the day. If they are determined to discipline their own parties and force through this hard Brexit option – that is the thing that will make him happen.”

Cable argued that such a coalition of interests would make hard Brexit more likely to happen, but would also bolster the position of the Lib Dems.

Promising that his party would not prop up a Conservative administration, Cable said May was trashing 10 years of work by David Cameron to detoxify the Tory brand by “clinging to power” and doing a deal with the Democratic Unionist party.

He said “we all have to admire” what Corbyn had achieved in the election, but added that there was “something inherently implausible about a modern party competing for government on a programme of Venezuelan socialism”.

In a speech and lively question and answer session with political journalists in Westminster, Cable said that having George Osborne ask if his son could canvas for the Lib Dems in the election was a high point. He added that he was a fan of the former chancellor

He also claimed that another Brexit vote in a second referendum would “kill the issue forever” and that any move by the Bank of England to raise interest rates would hit people hard and could change the “political chemistry” around Brexit.

Cable, who is credited with predicting the financial crash of 2008, described that downturn as an “economic heart attack”.

“And sure, we have recovered, we are walking around, the economy has many elements to the norm – but almost 10 years later we are still attached to a life support system – which is ultra cheap money – without historical precedent,” he said.

Cable quoted the Bank’s chief economist Andy Haldane, who recently told the Guardian that urgent action was needed to rein in rising inflation, saying that rates had not been so low since the Babylonians.

“He and others in the Bank are now saying we can’t let this continue; it is creating enormous distortions in the way the economy works and what is going to happen before long is that a whole generation of people with debts are going to find it is hitting them,” said Cable.

He argued that the economy would return to centre stage in a “very dramatic way”, adding that that people did not vote for Brexit to be poorer.

Asked why people voted for Brexit, Cable said it was a mixture of interest groups. He pointed to campaigning in church halls in places such as Hampshire and Dorset where elderly people “were obsessed with the worry of 80 million Turks coming to live in their village”.

He added that “immigration was a massive issue for them, though they never actually encountered any” before apologising for being “slightly facetious”.

However, he did cite among older, Conservative voters “a sense of nostalgia – the Britain they had been brought up in and loved and felt comfortable with – was no longer there”. Cable said there was also a “left behind” phenomenon in parts of the country.