Brexit news latest: Chancellor Philip Hammond says second referendum ‘very likely’ to be put to Parliament again

The Chancellor has said the idea of a second Brexit referendum is “very likely” to be put before Parliament again. 

Philip Hammond said on Friday that he hoped MPs would pass a deal by the end of June, breaking the Brexit deadlock. 

He added that there was a “good chance” of a breakthrough in talks with the Labour party. 

“I remain optimistic that over the next couple of months we will get a deal done,” Mr Hammond told reporters in Washington where he is attending meetings at the International Monetary Fund.

However the chancellor could not rule out a second vote on Brexit. 

“It’s a proposition that could and, on all the evidence, is very likely to be put to Parliament at some stage,” Mr Hammond said.

Theresa May has so far failed to get majority backing for the Brexit divorce deal she agreed with other European Union leaders last year, forcing her to ask the bloc for a delay and to start talks with the oppositing about how to break the impasse in parliament.

Many Labour MPs are pressing leader Jeremy Corbyn to demand a new referendum in talks with the Government.

Mr Hammond said that while the Government was opposed to a new public vote, other Labour demands – such as a customs union with the EU – were up for debate.

He said that around six months would be needed to hold a referendum, so if Parliament voted in a couple of months time to approve a deal there would not be enough time before Britain is due to leave the EU on October 31. 

The chancellor was keen for MPs to pass a deal in the coming months. 

Speaking to the BBC, Mr Hammond said it was time to get Brexit “off the table” so the UK can focus on other issues. 

“I would like us to spend more of our bandwidth focused on growing our economy,” he told the BBC’s economics correspondent Dharshini David. “Until a deal is done we cannot make decisions about the spending review.”

Parliament has previously rejected the idea of a new referendum and other possible solutions the Brexit impasse.

Mr Hammond said the risk of a no-deal Brexit had been reduced but not averted by this week’s delay of Britain’s exit and such an outcome would be felt in the global economy.

Ending the uncertainty would “unleash the very large stock of potential investment that is hanging over the UK economy in suspended animation,” he said.

Bank of England Governor Mark Carney said on Thursday that Brexit had pushed business uncertainty “through the roof”.

Mr Carney is due to step down at the end of January, having delayed his departure twice to help Brexit preparations.

Mr Hammond said Brexit could put off some qualified candidates in the search for the next BoE governor which was now underway.

“There may be some candidates who might be deterred from an application because of the political debate around Brexit, which inevitably the governor of the Bank of England can’t avoid being part of,” he said.

Supporters of Brexit have often accused Mr Carney of giving over-gloomy assessments of the costs of leaving the EU.

Hammond also said the Brexit delay was hampering government efforts to improve economic productivity and could throw off course a planned multi-year budget for government departments due late this year.

Additional reporting by agencies.