Economy to dominate day three of Brexit debate with the chancellor making the government's case

The economy takes centre stage today in the epic five-day Brexit debate in the Commons, as Chancellor Philip Hammond faces the government's opponents.

Mr Hammond will open day three of the debate just 24 hours after telling a committee of MPs (BSE: MPSLTD.BO - news) the UK economy would be badly damaged in the event of a no-deal Brexit.

The debate resumes after frantic attempts behind the scenes by the prime minister and her closest allies to woo rebel MPs ahead of next Tuesday's big Commons vote.

Theresa May revealed some of those efforts on Thursday, when she described how she is looking at ways to give MPs the choice between extending the Brexit transition period or entering the Northern Ireland backstop arrangement, in the event the future UK-EU relationship isn't agreed by the end of 2020.

She (Munich: SOQ.MU - news) told BBC Radio 4's Today programme: "All of these issues I'm exploring and I'm exploring in terms of the sovereignty of the UK, the role of parliament in being able to have their say in that."

Mrs May added it was "obvious" for parliament to make such a decision.

The prime minister also dismissed suggestions she could delay next week's vote on her Brexit deal, amid predictions she could suffer a heavy defeat with MPs overwhelmingly rejecting her agreement.

"What I'm doing is leading up to a vote on Tuesday," she said.

After holding meetings with Tory MPs in the Commons on Wednesday, Mrs May entertained party activists from the strongly pro-Leave region of South West England at a drinks reception in No.10.

At the same time, the PM's Commons enforcer held a 60-minute showdown with hardline eurosceptic Tory MPs, but failed to persuade them to call off their Brexit mutiny.

Government Chief Whip Julian Smith and his deputy Chris Pincher attended a meeting of the European Research Group (ERG (LSE: 0MHC.L - news) ) of Conservative MPs, led by Jacob Rees-Mogg.

One MP present, an ex-minister who quit over Brexit, described the mood as "brutal". Another MP said the discussion was "candid" and a veteran backbencher said it was "a robust exchange of views".

After the meeting, senior ERG members denied that Mr Smith had come with an offer of concessions to buy off the rebels. "The Chief Whip was in listening mode," one MP said.

"There were lots and lots of questions. It was not about doing deals. The Chief said he was listening to MPs' concerns. He said the Government was looking at all options."

Earlier, Mr Smith met the Democratic Unionists' 10 MPs, who vowed to vote against the PM's deal because of their option to the Irish "backstop" which keeps the Irish border open.

But the DUP confirmed that if the Prime Minister's deal is defeated in the vote on Tuesday its MPs will back the Conservatives if Labour tables a no-confidence motion in the government.

Speaking to Sky News after the DUP's meeting with Mr Smith, the party's Brexit spokesman Sammy Wilson said: "This is the Prime Minister's Neville Chamberlain moment.

"She waved this agreement in the faces of the people of Northern Ireland and said it's a good agreement and the Attorney General has made it quite clear that it's not a good agreement.

"It breaks up the United Kingdom. We have to treat the rest of the United Kingdom to which we belong as a third country."

Ahead of the Chancellor's speech in the debate, former Tory leader and leading Brexiteer Iain Duncan Smith rejected the Treasury's gloomy economic forecasts in the event of no deal.

"The financial forecasts are really not worth very much and I would park them," he told Sky News. "They didn't get the 2008 crash right. They threatened that we'd have a crash and unemployment and a fall in GDP when we voted to leave, so all of these things are clearly wrong."

The International Trade Secretary Liam Fox will wind up day three of the Commons debate for the government and no doubt face challenges on his much-derided claim: "Coming to a free trade agreement with the EU should be one of the easiest in human history."

Although it is MPs who will have the decisive vote on the Brexit deal on Tuesday, most of the Tory activists who spoke to Sky News after the No.10 reception backed the Prime Minister.

Linda Taylor, from St Ives (LSE: SIV.L - news) , said: "Very positive. You have to admire the Prime Minister's tenacity. She's really showing us what a strong woman can do."

Bryan Carson, from southwest Devon, said: "We can't go on like this forever, messing around, can we? So I'm all in favour of having the deal, which is quite a good deal really. Then we'll argue about other bits once we've done this bit."

But Bob Davidson, from southeast Cornwall, said: " I'm not persuaded to back the deal. I don't support the deal. I hope it falls."