May races to revive Brexit talks as Irish border row threatens to drag into 2018

Pressure is growing on Mrs May to get leaders at the December 14 European Council summit to declare sufficient progress has been made on divorce issues so trade talks can begin, with business chiefs warning companies will activate contingency plans that will cost Britain jobs if there is further delay.

After talks in Dublin, Taoiseach Leo Varadkar and Dutch PM Mark Rutte made clear the EU would not compromise and allow the Irish border to be kicked down the road to phase two of the talks, even under threat of Britain crashing out with no deal or divorce negotiations dragging on to 2018.

And after a phone call with Mrs May on Wednesday, Mr Varadkar said the PM was hoping to return with a new formal written offer "tonight and tomorrow", but warned if there was no agreement talks would be picked up in the New Year.

Downing Street said Mrs May told Mr Varadkar she was "working hard to find a specific solution to the unique circumstances in Northern Ireland" and was committed to "moving together to achieve a positive result on this".

The PM also spoke with DUP leader Arlene Foster, whose rejection of plans for "regulatory alignment" between Northern Ireland and the Republic led to the collapse of a proposed deal on Monday.

But it is understood Mrs Foster has no immediate plans to fly to London for talks with Mrs May and any such move would depend on progress in negotiations between the DUP and the Government in London.

Confederation of British Industry (CBI) president Paul Drechsler underlined businesses' "immediate" need for a transition deal, telling the City of London Corporation: "Or 60% of firms with contingency plans will have put these into effect by Easter. That means jobs leaving the UK - in most cases irreversibly."

Meanwhile, senior ministers came under attack over their positions on Brexit as Chancellor Philip Hammond revealed the Cabinet had not yet discussed details of the UK's preferred long-term relationship with the EU.

Mr Hammond also received a slapdown from Downing Street after suggesting it was "inconceivable" the UK would not pay a financial settlement to the EU, regardless of whether it obtains a trade deal.

The Prime Minister's official spokesman swiftly said the payment - estimated at up to £50 billion - was "dependent on us forging (a) deep and special future relationship with the EU".

And opposition MPs demanded that Brexit Secretary David Davis be sacked and face investigation for contempt of Parliament after admitting his department had produced no impact assessments of the likely effect of Brexit on different sectors of the UK economy.

As conflicting reports suggested the EU was considering when exactly Mrs May would pass the point of no return in her hopes to get an agreement on "sufficient progress" before next week's summit, Mr Varadkar warned in the Irish Dail: "We want to move to phase two but if it is not possible to move to phase two next week because of the problems that have arisen, well then we can pick it up of course in the new year."

Later in a press conference alongside Mr Rutte, he said Mrs May "wants to come back to us with some text tonight and tomorrow".

Mr Rutte said they "will not loosen" their position on the "fundamental" points of citizens' rights, the exit bill and the border.

Elsewhere, 19 Remain-backing Tory MPs wrote to Mrs May to condemn "highly irresponsible" Brexit-backing colleagues who "seek to dictate terms" that could leave Britain leaving the EU with no deal as negotiating pressure mounts.

Among the signatories to the letter were former cabinet ministers Nicky Morgan, Dominic Grieve and Stephen Crabb, as well as select committee chairs Sarah Wollaston and Bob Neill.