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Britain is heading towards a “dilution of Brexit”, a former cabinet minister has said.

Conservative MP Theresa Villiers, who backed the Leave campaign, warned of a “real danger” Britain would remain in the European Union “in all but name”.

Her intervention in the Sunday Telegraph came amid a growing Tory rift over the handling of Brexit negotiations.

Chancellor Philip Hammond was criticised this week for saying the UK's trade relations with the EU would change only "very modestly" after Brexit, sparking anxiety among Leavers that Brexit may be delivered "in name only".

Mr Hammond was rebuked by Number 10 but stoked Tory divisions further by saying the UK should seek a "middle way" in negotiations in order to maximise access to EU markets.

Ms Villiers, who was Northern Ireland Secretary from 2012 to 2016, said she had long been a supporter of "compromise and moderation" in the negotiations of the UK's departure from the EU.

But she wrote: "That said, I understand why some are becoming nervous about the current situation.

"Since the Prime Minister set out a bold vision in her Lancaster House speech, the direction of travel seems to have gone in only one single direction: towards a dilution of Brexit."

She added: "If the Government goes too much further down that path, there is a real danger that it will sign up to an agreement which could keep us in the EU in all but name and which would therefore fail to respect the referendum result."

Referring to a speech by Prime Minister Theresa May in which she outlined an optimistic blueprint for Britain’s future outside the EU, Ms Villiers said it was that "optimistic vision" that needed to be at the forefront of the negotiations.

She called on the PM to resist the "immense pressure from a range of quarters to water it down".

Ms Villiers is the latest senior Conservative to voice concerns about the direction of negotiations, with leading Brexiteer Jacob Rees-Mogg warning Theresa May earlier this week that if she delivers "Brexit in name only" with a status quo transition period, the Conservatives will lose the next election.