Juncker raises hopes of end to Brexit deadlock as May prepares new offer

EU Commission chief Jean-Claude Juncker today raised hopes of progress in stalled Brexit talks as Theresa May prepared to offer billions more of taxpayers’ cash to break the deadlock.

The Prime Minister is seeking co- ordinated moves to pave the way, at an EU summit in December, for the start of talks on a free trade deal.

But negotiations are being overshadowed by the risk that two key governments, in Germany and Ireland, could collapse, leading to new elections.

Arriving at an EU Eastern Partnership summit in Brussels today, Commission president Mr Juncker offered a hint of optimism, saying of the Brexit talks: “They are making progress.”

Ahead of a meeting with European Council president Donald Tusk, Mrs May said: “We must step forward together. This is for both the UK and the European Union to move onto the next stage.”

This week the Cabinet agreed for the Prime Minister to make clear that Britain is ready to up its “divorce bill” offer from about £18 billion — with some reports saying the amount could be doubled, and then rise even further.

Environment Secretary Michael Gove and Foreign Secretary Boris Johnson are said to have insisted the extra cash can only be offered on condition of getting a good trade deal, and Mrs May was not expected to give a figure today on how much Britain could pay.

However, Brussels chiefs were reported to be demanding a written guarantee that the pledge of extra billions will be paid.

Mr Juncker is due to meet Mrs May on December 4 to discuss progress before the next leader’s summit. Today Austrian chancellor Christian Kern, asked by British reporters whether the UK should pay more, said: “Yes of course you should, it’s an easy answer.”

A bigger hurdle appeared to be finding a solution to avoid a hard border between Northern Ireland and the Republic of Ireland after Brexit.

The Irish government is sticking to its demand for more guarantees on the border before moving talks on.

Democratic Unionist MPs believe Dublin and Brussels are seeking to force Northern Ireland, or the UK as a whole, to stay in the customs union.

However, Ireland’s foreign minister Simon Coveney again threatened to block trade talks unless the UK offered more “clarity and credibility” on how to avoid border checks. “What we’re seeing at the moment is a negotiation which is coming to a head on these issues, hopefully before the leaders’ summit in December,” he said.

Meanwhile the Irish government risks collapse over a police whistleblower scandal involving the Tanaiste — Ireland’s deputy prime minister. Mr Coveney warned that moves by opposition parties Fianna Fáil and Sinn Féin to table a no-confidence motion against Frances Fitzgerald could bring down Leo Varadkar’s minority government.

Referring to Fianna Fáil’s confidence and supply deal to support the government, Mr Coveney said: “If they move ahead with the motion of no confidence, the confidence and supply is over ... then I don’t see how we can have a government that can function.”

In Germany, the Social Democrats said they were ready to hold talks with other parties on breaking the deadlock created by Chancellor Angela Merkel’s failure to form a new coalition. The SPD has so far refused another deal with Ms Merkel’s Christian Democrats, after heavy losses in September’s election.

But SPD general secretary Hubertus Heil said today: “The SPD will not say no to discussions.” It raised hopes that new elections might be avoided.