Philip Hammond said there were no red lines in talks between senior Conservative and Labour figures to end deadlock over Brexit after they appeared to stall on Friday.
The chancellor said the government was optimistic about finding an alternative to the prime minister’s Brexit deal that might be able to command a majority in the House of Commons.
“We should be open to listen to suggestions that others have made, and some in the the Labour party have suggested others. We have to be prepared to discuss,” the chancellor, who is in Bucharest for an EU finance ministers meeting, said.
“Our approach to these discussions is that we have no red lines, we go in to these talks with an open mind and discuss everything with them in a constructive fashion.”
Labour has accused the prime minister of failing to offer “real change or compromise”.
Shadow home secretary Diane Abbott told Radio 4’s Today Programme: “We are engaged in these talks in good faith but the government perhaps has to show a little more flexibility than it seems to have done so far.”
Senior Conservative and Labour figures took part in a third day of talks on Friday, aimed at finding an alternative to the prime minister’s Brexit deal that might be able to command a majority in the House of Commons.
But Keir Starmer, shadow Brexit secretary, said the government had not offered to change the political declaration on future relations between the UK and the EU, which Mrs May agreed with the bloc in November, together with the exit treaty.
“So far, the government isn’t proposing any changes to the deal,” said Sir Keir. “Obviously, that’s disappointing.”
Downing Street responded by saying that it had made “serious proposals”, and was now “prepared to pursue changes to the political declaration”.
“The conversations with the Labour Party are continuing, they were continuing last night, we are expecting to exchange some more texts with the Labour Party today,” Mr Hammond said on Saturday.
Labour’s complaint about the lack of progress in the talks is a blow to Mrs May’s efforts to secure a short delay to Brexit with EU leaders at a summit in Brussels next Wednesday.
On Friday she proposed pushing back the date of when the UK leaves the EU from April 12 to June 30: a timetable premised largely on her ability to reach a rapid agreement with Labour on a Brexit compromise.
The prime minister had offered talks with Mr Corbyn on Tuesday in a dramatic about-turn, after recognising that a majority of MPs would not back her Brexit deal.
The move led to fury among many Conservative MPs, including the former foreign secretary Boris Johnson, who accused her of “entrusting the final handling of Brexit to Labour”.
Negotiations between the Tories and Labour have not yet broken down, and could continue this weekend.
Downing Street said it was “ready to hold further detailed discussions this weekend in order to seek any such changes in the run-up to European Council on Wednesday”.
Downing Street has previously said that, if it is unable to agree a deal with Labour, it will instead try to present a range of Brexit options for MPs to vote on.
This “indicative vote” format could yet resuscitate Mrs May’s deal, particularly if it involved a transferable vote system.
One government official said that Downing Street would “now need to agree a process for indicative votes which is very important. If you control the process you control the outcome”.
In theory, there is common ground between Mrs May and Mr Corbyn over Brexit. Both leaders are committed to ending free movement of people, and have concerns about a second referendum.
But an exchange of letters between the Conservatives and Labour on Friday revealed stark differences over how any compromise would be reached.
Labour said it had been expecting changes to the wording of the political declaration, which has been twice rejected by MPs.
Instead the government’s negotiators, led by David Lidington, the de facto deputy prime minister, offered only an “additional text”.
Recommended
A Labour aide likened the government’s approach to its attempt to find assurances over the backstop, the insurance mechanism to avoid a hard Irish border in the exit treaty.
With the backstop, the government negotiated legal assurances with the EU — but these did not change the exit treaty or placate Eurosceptic Tories.
Labour is also concerned that any agreement would only be with Mrs May, who has promised to step down as prime minister almost as soon as her Brexit deal might be ratified. “The next Conservative leader may not be bound by this,” said the Labour aide.
Labour policy involves a permanent customs union between the UK and the EU, but Mr Johnson, one of the favourites to succeed Mrs May, said this week that any Brexit deal featuring such an arrangement would “not last”.
