Statement comes after ministers contradict each other and reports of a challenge to Theresa May’s leadership over issue

Downing Street has ruled out involvement in a customs union with the European Union amid confusion over government policy as Theresa May prepares for a crucial week of talks.

After the exposure of divisions between ministers over the UK’s future relationship with the EU, an official source said: “It is not our policy to be in the customs union. It is not our policy to be in a customs union.” The statement went further than May who, on Friday, refused to rule out involvement in a customs union when questioned during her visit to China.

The development will anger remainers who have clung to hope that Britain will strike a deal with the EU that allows a close relationship with the EU after Brexit. But it will soothe the fears of Conservative Brexiters who have been threatening a leadership challenge if May moves towards an agreement with the EU that restricts the trade deals the UK can seek with third parties.

The clarification came on the eve of a visit to Downing Street by the EU’s chief negotiator, Michel Barnier, and as officials in Brussels prepared to begin talks on the transitional arrangements. Key cabinet colleagues will meet on Wednesday and Thursday to decide the details of the government’s policy regarding a customs union.

The Downing Street source claimed that a customs union was entirely different from a customs arrangement, which would allow the government to strike trade deals with countries outside the EU. The source also claimed that there had been no change in policy, saying the statement was a reiteration of policy outlined in a paper published in August.

Last week, Brexit advisers were reportedly considering whether the UK could strike a customs union deal with the EU that would cover just trade in goods.

The source spoke shortly after the home secretary, Amber Rudd, forecasted on Sunday that the UK would negotiate a customs arrangement with the EU, which was contradicted by Dominic Raab, the Brexi-supporting housing minister.

Play Video 1:02 Amber Rudd: Brexit committee 'more united' than people think – video

Asked about a possible customs union on Friday, May refused to rule it out, telling Sky News: “What I want to do is ensure that we have got the best possible trade arrangements with China and with other countries around the world.”



Appearing on the Andrew Marr Show, Rudd, who campaigned to remain in the EU, said May would consider a customs arrangement with the EU. “She has an open mind on it. We published a document last year saying how we would do it and we proposed either a customs arrangement or a customs partnership. Those are both alternatives we could look at,” Rudd said.

The home secretary, who sits on the Brexit subcommittee, also dismissed claims of a plot to oust May by Brexiters, saying that the government is united: “I have a surprise for the Brexiteers, which is the committee that meets in order to help make these decisions is more united than they think.”

Minutes later, Raab told the Sunday With Paterson show on Sky: “I do not think that we will be in any form, at least as conceived in international trade practice, of customs union, because … we would have our hands tied while negotiating trade deals with other parts of the world whether it is Brazil or China or India.”

May has avoided a full discussion in the Brexit subcommittee on the issue because of the sensitivities involved, sources said.



Tory rebels launch bid to keep UK in customs union with EU Read more

The Sunday Times reported that Boris Johnson, the foreign secretary, had told plotters he would be ready for a future contest and said “the cavalry” was coming to block a customs union plan when the committee meets this week. It is understood that he plans to argue against a customs union in Downing Street this week but still backs May in public.

The paper also claimed that Johnson, Michael Gove, the environment secretary, and Tory backbencher Jacob Rees-Mogg have been urged to form a “dream team” of Brexiters to take over from May’s administration.

Rees-Mogg played down the suggestion. “The story is news to me, no one had suggested this to me,” he said.



MPs from both sides of the Tories’ Brexit divide have told the Guardian that the prime minister is partly to blame for the internal crisis by failing to spell out what she wants from this week’s crucial meetings.



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One said: “Both sides – pro-Brexit and remain – still think it is all to play for because the PM has not said what she wants. She is sowing division and bad headlines through another dither.”



The Labour MP Pat McFadden said the Downing Street statement on Sunday evening appeared to confirm that a revolt of rightwing Tory Brexiters has been successful. “The last week has been bad for our democracy. Now we know it has been bad for our economic interests too. Time after time the interests of right-wing nationalism have trumped the economic wellbeing of the public. The question is whether there is a parliamentary majority to take a less destructive and ideological path.”

