News / Politics

Hammond: Delay Brexit for risks to financial stability

Tuesday, 13 December 2016 12:57 AM [ Last Update: Tuesday, 13 December 2016 9:46 AM ]

British Chancellor Philip Hammond speaks to the Treasury Committee on Monday, December 12, 2016. (Photo via Daily Mail)

British Chancellor Philip Hammond has called for a delay in completing the Brexit process, saying it might otherwise pose “risks to financial stability.”

Hammond said Monday that “an emerging view among businesses, among regulators and among thoughtful politicians” necessitated a transitional deal after Brexit.

A slower process “would tend towards a smoother transition and would run less risks of disruption, including - crucially - risks to financial stability, which must be a very real concern,” he noted.

The issue must be discussed at the start of Brexit negotiations next spring, he told MPs on the Treasury committee in the firmest statement in support of a transitional deal.

“Collectively, I think transitional arrangements would be beneficial to us,” he stated.

Hammond also warned that it would be necessary to hire and train “large numbers of people” to deal with a five-fold increase in border checks, which would cost “hundreds of millions of pounds.”

This comes after a leaked memo showed that Brexit Secretary David Davis had told representatives from the City of London Corporation (CLC) that he was “not really interested' in having a transitional deal with the European Union.

The EU has warned that Britain will have less than 18 months to reach a deal to exit the bloc once Brexit negotiations begin.

British Prime Minister Theresa May (pictured above) has promised to begin the Brexit process in March and complete it by 2019. However, those plans were delayed when the UK High Court required a parliamentary vote for triggering Article 50.

Her spokesman said she was not expecting to negotiate a Brexit deal for longer - something that would be possible only by mutual consent.

"There is a two-year time frame," the spokesman said, noting, "We are not seeking to extend that process."

May has also been under pressure by some politicians to pursue the so-called hard Brexit, which suggests surrendering access to the EU’s single market and scrap free movement of EU nationals in return for securing control over immigration.

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