PM warned EU leaders it would be 'calamitous' to deny a good deal for Britain

Rejected 'half-in, half-out' deal and made clear we are leaving the single market

Britain will regain control over borders and quit the European Court of Justice

Supports calls for fixed length 'transitional' deal to avoid cliff edge for business

Theresa May laid out her Brexit demands in a series of phone calls to EU leaders, including Angela Merkel and Francois Hollande.

The Prime Minister told the heads of Germany and France that Britain would not stay in the single market and insisted controlling immigration was a red line.

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Mrs May stated her plans to break free from the EU's shackles in a historic speech earlier today that will define the UK for generations.

She laid out her Brexit aims in a series of phone calls to EU leaders, including Angela Merkel - pictured yesterday speaking in Berlin

The Prime Minister told Francois Hollande that Britain would not stay in the single market and insisted controlling immigration is a red line

But furious EU chiefs tonight hit back at Mrs May's threat to walk away from Brexit talks if Brussels refused to offer Britain a good deal in divorce talks.

In addition to gaining full control over the UK's borders, the Prime Minister also said Britain will no longer tolerate being bossed around by European judges.

But she was told Brussels will not allow her to dictate the terms of Brexit.

Guy Verhofstadt, the Belgian politician in charge of Brexit talks for the hostile European Parliament, said: 'Britain has chosen a hard Brexit. May's clarity is welcome—but the days of UK cherry-picking and Europe a la cart [sic] are over.'

There was more cautious reaction from EU Council president Donald Tusk, who welcomed Mrs May's 'realistic' Brexit plan and declared the EU's other 27 member states 'ready to negotiate'.

The Prime Minister spoke with Angela Merkel and Francois Hollande over the telephone.

A Downing Street spokesman said: 'Chancellor Merkel and President Hollande both welcomed the Prime Minister's commitment to the continuing strength of the EU, and her intention to negotiate a new partnership with the EU when it leaves.'

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Referring to earlier talks with Council President Donald Tusk and Jean-Claude Junker, who heads the European Commission, the spokesman added: 'President Juncker and President Tusk both welcomed the greater clarity in the UK’s position.

'And President Tusk said he looked forward to negotiating in a spirit of good will once the UK had triggered Article 50.'

The response from Brussels came after Mrs May unveiled her bold blueprint for cutting ties with Brussels today - and warned that if the EU is not flexible it could be 'crushed into tiny pieces'.

The PM's vision delighted Brexiteers but drew howls of outrage from Remainers - who have been frantically trying to limit the impact of the referendum result since last June.

It brings to an end months of hedging and stonewalling by ministers, as they hammered out the plan of attack in the looming negotiations with the EU.

And in a concession to Europhile MPs and peers after months of bitter rows she announced that they will be given a vote on the final Brexit deal.

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Today there were still signs of dissent to the PM's approach to Brexit on the Tory backbenches. Former Cabinet minister Dominic Grieve warned there will be 'economic consequences' when we quit the single market.

In a bravura performance watched by her top ministers and diplomats in the opulent surroundings of Lancaster House, Mrs May:

Told the EU that it would be an act of 'calamitous self harm' to try to punish the UK, warning of retaliation and saying it could end up 'crushed into tiny pieces'.

Said Britain had 'always looked beyond Europe' and the referendum was not a vote for withdrawing from the world stage.

Stressed it remained 'overwhelmingly' in the UK's interests for the EU to survive and succeed - and urged the bloc to behave in an 'economically rational' way.

Said staying in the single market would not be Brexit and reiterated her determination to curb immigration.

Made clear that she is prepared to walk away from the negotiating table if necessary because 'no deal for Britain is better than a bad deal'.

Voiced support for a transitional agreement to 'phase' in the new relationship with the EU, but insisted it must be time limited to avoid becoming a damaging political 'purgatory'.

Bowed to pressure from pro-EU parties and some Tories by announcing that the final Brexit deal will be put to a binding vote in both Houses of Parliament.

Insisted she will find a solution to concerns that a 'hard' border could be needed between Northern Ireland and the Republic, potentially undermining the peace agreement.

Mrs May warned that the EU could be 'crushed into tiny pieces' if it did not recognise the demand for more sovereignty

Guy Verhofstadt, pictured, the Belgian politician in charge of Brexit talks for the hostile European Parliament, said: 'Britain has chosen a hard Brexit. May's clarity is welcome—but the days of UK cherry-picking and Europe a la cart [sic] are over'

Guy Verhofstadt, the European Parliament's chief Brexit negotiator, warned Mrs May she would come up against fierce resistance in Brussels, writing on Twitter: 'The days of UK cherry-picking and Europe a la carte are over'

Responding to Mrs May's speech, Mr Tusk said: 'Sad process, surrealistic times but at least more realistic announcement on Brexit'

The PM kicked off her long-awaited speech by voicing bullish confidence in the prospects for the UK on the global stage.

'I want Britain to be what we have the potential talent and ambition to be; a great global trading nation that is respected around the world and strong, confident and united at home,' she said.

'That is why this Government has a plan for Britain; one that gets us the right deal abroad but also ensures we get a better deal for ordinary working people at home.

'It's why this plan sets how we will use this moment of change to build a stronger economy and a fairer society.'

THE 12 PRIORITIES THAT UNDERPIN THE PM'S BREXIT PLAN Today Theresa May set out 12 priorities for her upcoming Brexit negotiations with the EU: Promised to provide 'certainty and clarity' to business and the public sector 'wherever we can' but warned that compromises in the negotiations will be inevitable. Pledged to give MPs and peers a vote on the final Brexit deal. The UK will take control of our own affairs once again by ending the jurisdiction of the European Court of Justice. Laws will only be made in Westminster, Edinburgh, Cardiff and Belfast, the PM said. Strengthen the 'precious union' between England, Scotland, Wales and Northern Ireland to 'face the future together'. No hard border in Ireland. Mrs May promised to reach a 'practical solution' to maintain the Common Travel Area with the Republic of Ireland. Regain control of the number of people who come to Britain from Europe by ending freedom of movement rules. Secure a deal 'as soon as we can' on the rights of EU nationals already living in the UK to stay in Britain after Brexit in exchange for British expats currently living on the continent to remain there. Promised to not only translate EU law protecting workers' rights into UK law but to 'build on them'. On trade Mrs May promised to prioritise Europe and to pursue a 'bold and ambitious' free trade agreement with Brussels. But she set out a vision for a 'global Britain' that would see Britain 'rediscover its role as a great, global trading nation' by striking new trade deals with the world's biggest economies. Continue to work with European partners on major science, research and technology initiatives rather than weaken the collaboration. Pledged not to weaken the partnership with Europe on fighting crime and terrorism and said British authorities will continue to share intelligence material with EU allies to fight common threats. Vowed to pursue all these objectives in a 'smooth and orderly' approach. The PM said a 'phased process of implementation' for UK and EU institutions will protect business from a 'cliff-edge' scenario where they would be left stranded in a regulatory no man's land.

In a passage aimed firmly at the leaders of the EU and its member states, Mrs May said they must learn from the resounding verdict of the British electorate.

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'I believe there is a lesson in Brexit - not just for Britain but if it wants to succeed, for the EU itself, because our continent's great strength has been its diversity. And there are two ways of dealing with different interests,' she said.

'You can respond by trying to hold things together by force, tightening a vice-like grip that ends up crushing into tiny pieces the things you want to protect.

'Or you can respect difference, cherish it even and reform the EU so that it deals better with the wonderful diversity of its member states.'

Without even bothering to veil the threat, Mrs May said she knew some in the EU wanted to impose a 'punitive' settlement on Britain.

But she said it would be an 'act of calamitous self-harm' for the Brussels club, and the UK would slash tax rates and regulation to lure in business.

'It would not be the act of a friend,' she said. 'No deal for Britain is better than a bad deal.'

The premier rejected partial or associate membership in favour of a 'brighter future' outside the Brussels bloc.

She said staying in the single market was unacceptable because it would mean keeping free movement and European judges still being able to meddle.

'I want to be clear: what I am proposing cannot mean membership of the single market,' she said.

'European leaders have said many times that membership means accepting the four freedoms of goods, capital, services and people.

'And being out of the EU, but a member of the single market, would mean complying with the EU's rules and regulations that implement those freedoms without having a vote on what those rules and regulations are.'

The PM's 12-point plan will see Britain regain full control over borders and quit both the single market and European Court of Justice. She insisted the UK can become a great, outward-looking trading nation.

'We seek a new and equal partnership – between an independent, self-governing, global Britain and our friends and allies in the EU,' she said.

'Not partial membership of the European Union, associate membership of the European Union, or anything that leaves us half-in, half-out.

'We do not seek to adopt a model already enjoyed by other countries. We do not seek to hold on to bits of membership as we leave.

'The United Kingdom is leaving the European Union. My job is to get the right deal for Britain as we do.'

The PM did not explicitly vow to leave the customs union, which allows tariff-free trade and the movement of goods between its members.

Mrs May wore the same tartan trouser suit as when she launched her bid for the Tory leadership last summer

But she said she was determined not to sign up to anything that restricts the ability to take back sovereignty from the ECJ or prevents solo trade deals with the rest of the world.

In effect, that means quitting the customs union as it stands, and trying to strike a new trade deal which gives Britain the best of both worlds. One option would be to opt back in to some elements of the customs union, but on our own terms.

Mrs May damned predecessor David Cameron with faint praise by saying he had made a 'valiant effort' to renegotiate our membership terms.

But she said that was the 'final attempt to make it work for Britain'.

'The blunt truth as we know was there was not enough flexibility on many important matters for a majority of British voters,' she said.

Laying out her guiding principles once she triggers the two-year article 50 process for leaving the EU in March, Mrs May underlined the need to provide certainty and clarity to business, while delivering a 'stronger, fairer, truly global Britain'.

She said the British people voted for Brexit 'with their eyes open'.

The PM said she believed a solution could be found to concerns that a 'hard' border could be needed between Northern Ireland and the Republic

Boris Johnson was clearly delighted with the PM's words, continuing his applause as she left Lancaster House

Foreign Secretary Boris Johnson said Mrs May's 'powerful' speech will be 'well received' by EU nations.

Speaking to reporters at Lancaster House, he went on: 'Because it's negotiable, this is something that I think will be good for the UK and good for the rest of the EU as well.'

Asked why the EU would give the UK a 'free lunch', Mr Johnson said: 'As the Prime Minister said, I think it's going to be good for both sides.'

He went on: 'We very strongly think this is in our mutual interest. We're not leaving Europe, we're disentangling ourselves from the treaties of the EU.

'We can remain powerfully committed to Europe with a new European partnership ... whilst also going forward with an identity as Global Britain.'

The Prime Minister's spokeswoman clarified later that the parliamentary vote on the final Brexit deal will be legally binding on the Government.

She said: 'We are focussed on getting the right deal for Britain and securing a bright future for our country and we now want our country – including MPs – to get behind that.

'We will be leaving the EU so we will be having a negotiation; the outcome – MPs will have an opportunity to vote on that.'

Setting out her detailed plan for Brexit, Mrs May - seen leaving Downing Street to deliver her speech today - rejected partial or associate membership

Mrs May briefed the Cabinet, including Foreign Secretary Boris Johnson. this morning

Home Secretary Amber Rudd will be responsible for administering the new immigration system

Environment Secretary Andrea Leadsom, a prominent Leave campaigner, appeared pleased as she arrived for the Cabinet gathering this morning

Mrs May's hand in the negotiations has been dramatically strengthened after Donald Trump promised to do a quick trade deal with Britain yesterday.

The resilience of UK plc has also been underlined after the IMF revealed it was the fastest growing economy in the developed world last year – and sharply uprated its gloomy forecasts for 2017.

The tough line has already triggered a wave of protest from Remainers, who complain that leaving the single market or customs union would be a disaster for the economy.

Mrs May was watched at Lancaster House by an audience that included her top ministers and senior diplomats

Brexit Secretary David Davis made a statement to MPs in the wake of the speech, urging them to 'embrace this moment of change'

European Council president Donald Tusk said the speech made him 'sad', but praised it as 'more realistic'.

The 27 EU states were 'united and ready to negotiate', he insisted.

Tim Farron accused Theresa May of a 'theft of democracy' as he led the pro-EU response to her Brexit speech.

The Liberal Democrat leader - who has demanded a second referendum on the EU despite only having nine MPs - said nobody voted for Britain's exit from the EU single market.

Leading Tory remainer Anna Soubry welcomed the announcement of a Commons vote on the final deal.

PM SETS STAGE FOR BREXIT SHOWDOWN WITH CONCESSION ON VOTE FOR MPS AND PEERS Theresa May has set the stage for a Brexit showdown by announcing that MPs and peers will get a vote on the final deal. The concession by the Prime Minister comes after months of rowing about parliament's role in the process. Whatever package is negotiated with the EU will now be put to the Commons and the Lords for approval. The move has been broadly welcomed by Labour and the Lib Dems. However, it does not have any bearing on the ongoing battle over whether Mrs May has the executive power to start the two-year Brexit process. The Supreme Court is due to rule imminently on that issue - with the government facing being forced to bring forward emergency legislation to repeal the Act that underpins our membership.

She tweeted: 'PM's speech has much to commend it & tone spot on. Wish she'd said it in Parliament before party conference!'

Labour leader Jeremy Corbyn said: 'Theresa May has made clear that she is determined to use Brexit to turn Britain into a bargain basement tax haven on the shores of Europe.

'She makes out this is a negotiating threat to the 27 EU countries but it's actually a threat to the British people's jobs, services and living standards.'

Labour former cabinet minister and arch-Europhile Lord Mandelson accused Mrs May of pretending there was a 'clicky fingers' solution to Brexit.

The peer insisted the UK should accept the EU's principle of free movement - which has helped drive net migration to 330,000 a year - in return for staying in the single market.

'There are no clicky finger solutions to these issues, but not even to acknowledge the difficult choices that have to be made, I think is very worrying indeed,' he told BBC Radio 4's Today programme.

Mrs May briefed the Cabinet on her vision this morning before delivering her speech.

At the top of the list of her 12 objectives is a commitment to regain control of the UK's borders with a visa regime for EU workers and a pledge to restore British sovereignty by no longer being subject to the rulings of the European Court of Justice.

There is also a key goal of securing a deal that will allow the three million EU citizens living in Britain to stay here, with a reciprocal arrangement for Britons living abroad.

In a bid to ease tensions north of the border, the PM made a specific commitment to 'preserve the Union' with Scotland by securing a Brexit that works for those on both sides of the border.

Chancellor Philip Hammond has threatened to slash business taxes if the EU will not reach agreement on tariff-free trade. The tactic has been dubbed a 'recipe for a trade war' by Labour leader Jeremy Corbyn.

Foreign Secretary Boris Johnson was among those who witnessed the PM plot the course for our departure from the EU

Mrs May said: 'I want us to be a secure, prosperous, tolerant country – a magnet for international talent and a home to the pioneers and innovators who will shape the world ahead.

'I want us to be a truly global Britain – the best friend and neighbour to our European partners, but a country that reaches beyond the borders of Europe too. A country that gets out into the world to build relationships with old friends and new allies alike.

'I want Britain to be what we have the potential and ambition to be: a great, global trading nation that is respected around the world and strong, confident and united at home.'

Yesterday, Berlin and Brussels reacted with fury to a prediction by Mr Trump that the EU could begin to fall apart – with other countries quitting the bloc in protest at mass immigration.

Pound leaps against the dollar and the euro as Theresa May spells out her Brexit plan

Mrs May's speech saw the pound leap against the US dollar and the euro

The pound soared as Theresa May set out her 12-point Brexit plan today.

Half an hour after Mrs May's speech ended the pound was up 2.5 per cent against the dollar, at 1.23, and 1.6 per cent against the euro at 1.15.

The pound had plunged in recent days in anticipation of Mrs May's speech, which is expected to confirm Britain will leave the EU single market.

Today's gains wiped out those losses as sterling had one of its strongest days in years.

London's main FTSE 100 stock index was also trading slightly down after Mrs May's speech.

Neil Wilson, senior market analyst at ETX Capital, said sterling soared on a 'far less hawkish Brexit speech from Theresa May than many had feared'.

He added: 'A wolf in sheep's clothing? Arguably Theresa May's greatest trick appears to have been to deliver what amounts to a fairly hard Brexit message without the markets going into a flat spin.

'Some judicious leaks in the last couple of days had primed investors for the UK to be leaving the single market.

'Many expected a tough sounding speech that would send the pound lower - that could yet happen as we progress towards invoking Article 50.

'And the looming Supreme Court judgment still matters a great deal.'

Ahead of the speech, Downing Street admitted that the speech to diplomats in London today would spark more volatility, as markets bet on how the Brexit negotiations will pan out.

Tim Farron claims Theresa May's full Brexit is a 'theft of democracy'

Tim Farron accused Theresa May of a 'theft of democracy' today as he led the pro-EU response to her Brexit speech.

The Liberal Democrat leader - who has demanded a second referendum on the EU despite only having nine MPs - said nobody voted for Britain's exit from the EU single market.

His claim comes despite key figures on both sides of last year's referendum battle making clear single market membership would end after Brexit.

Liberal Democrat leader Tim Farron accused Theresa May of a 'theft of democracy' today as he led the pro-EU response to her Brexit speech

The Prime Minister made clear for the first time today Britain could not be a single market member while securing her objectives of controlling immigration and striking trade deals.

Mr Farron said: 'Theresa May has confirmed Britain is heading for a Hard Brexit. She claimed people voted to Leave the Single Market. They didn't.

'She has made the choice to do massive damage to the British economy.

'Theresa May also made clear that she will deny the people a vote on the final deal. So instead of a democratic decision by the people in the country, she wants a stitch-up by politicians in Westminster.

'The people voted for departure, they should be given a vote on the destination. This is a theft of democracy.'

He added: 'When it comes to British prosperity and British democracy, she is waiving the white flag from the White Cliffs of Dover.'

Mrs May used a major speech on her Brexit plan to confirm Britain will leave the single market as part of a 12-point plan

Leading Tory remainer Anna Soubry welcomed the announcement of a Commons vote on the final deal.

She tweeted: 'PM's speech has much to commend it & tone spot on. Wish she'd said it in Parliament before party conference!

'I will continue to campaign for single market and free movement. With good transitional arrangements PM has rejected hard Brexit and that's v good news.

'Parliament will vote on the final deal - now let's have a white paper, scrutiny and debate.'

Labour leader Jeremy Corbyn said: 'Theresa May has made clear that she is determined to use Brexit to turn Britain into a bargain basement tax haven on the shores of Europe. She makes out this is a negotiating threat to the 27 EU countries but it's actually a threat to the British people's jobs, services and living standards.

'We welcome that the Prime Minister has listened to the case we've been making about the need for full tariff free access to the single market but are deeply concerned about her reckless approach to achieving it.

'This speech should have been given in Parliament where MPs could ask her questions on behalf of their constituents.

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'She talks about Brexit restoring parliamentary sovereignty but, once again, she is determined to avoid real scrutiny of her plans.'