Theresa May says will not agree Brexit deal 'at any cost'

The UK and EU both want to avoid a hard border between Ireland and Northern Ireland but have yet to reach an agreement on how it will function

Reworking Theresa May's Brexit catchphrase, Barnier said: "Backstop means backstop".

However, there have been reports the bloc could yet call an extraordinary gathering of national leaders towards the end of November following recent signs of progress.

Ireland and the United Kingdom are locked in talks over the "Irish backstop" - a proposal that would temporarily keep the United Kingdom in the customs union, following Brexit - in order to prevent a hard-border between the North and the Republic which would undermine the Good Friday Agreement.

The Withdrawal Agreement is 95% complete, but the final outstanding issues need to be resolved within the week if the United Kingdom government is going to achieve its aim of finalising a deal this month.

Mr Donaldson said a no deal would have "serious consequences" for the Republic of Ireland's economy and that the United Kingdom "won't have to pay a penny more" to the EU.

Theresa May has emerged from a tense Cabinet meeting this morning insisting she will not agree to a Brexit deal "at any cost", despite the clock ticking on reaching a Withdrawal Agreement.

Officials at the attorney general's office and the Brexit department are now drawing up plans for a system by which the United Kingdom could end a temporary customs arrangement with the European Union without Northern Ireland being treated separately.

Mr Varadkar's remarks come as several European Union sources cast doubt on whether a breakthrough can be reached this week on the Irish backstop in the Brexit negotiations.

The backstop is an arrangement that applies if the Irish border can not be kept frictionless during a wider deal.

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Mr Raab's suggestion, made to Mr Coveney in London last week, was for Britain to be able to end the backstop unilaterally after as little as three months if it chose to do so.

Varadkar separately told reporters that an expiry date of that nature would not be worth the paper it is written on. The clock is still ticking and we will continue the work.

Mr Varadkar was accused by Sinn Fein of having "lost his nerve" in Brexit negotiations by signalling his willingness to reach a compromise solution with the UK.

The Department for Exiting the European Union (DEXEU) said: "We wouldn't comment on private meetings".

Her optimism was immediately dampened by the EU's chief negotiator, Michel Barnier, who said that a deal on the Irish border was not "close" and that a "real point of divergence" on the issue remains. Without an operational backstop there will not be an accord and there will not be a transition period.

Expectations are rising that United Kingdom negotiator Olly Robbins will be pressing hard to finalise a deal in Brussels this week, to set the scene for a special Brexit summit later in the month to secure the approval of the leaders of the 27 remaining member states.

Mr Matheson, speaking in Treasury questions, said: 'The Government's own figures demonstrate between a 2% and 8% hit on the broader economy on Brexit, so isn't it the case that there is no form of Brexit that won't have a massive impact on the public finances and therefore on public services?'

"Looks like we're heading for no deal", he wrote on Twitter, adding: "Can't understand why Irish government seems so intent on this course".

Labour shadow chancellor John McDonnell has signalled his party will vote against the United Kingdom being in an effective customs union with the EU for a temporary period after Brexit.

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