Theresa May woos north-east England with powerhouse talk

Theresa May has reaffirmed her plans to bolster the northern powerhouse as she kicked off a summer campaign intended to win support for her much-criticised Chequers plan for Brexit at home and abroad.

The prime minister chaired a cabinet meeting in Gateshead on Monday before meeting factory workers for a rare town hall-style event, while her ministers fanned out across the region on a series of visits to businesses and public institutions.

After initially appearing to lose interest in the northern powerhouse agenda when she first took over at Downing Street, she was said to have encouraged a renewed focus on the plan late last year to rebalance the UK’s economy.

The government’s own Brexit economic impact analysis suggested that the north-east of England would face a 16% cut in economic growth, but May was upbeat when she faced a barrage of questions from engineering firm workers in Newcastle.

She confirmed that up to £780m was being set aside, from previously announced funding, for a pre-planned east coast mainline upgrade and that the “North of Tyne” devolution deal was to go ahead.

One of the most important things the government could do for the north-east economy was to successfully establish a free trade area for goods with the EU, she said, as a frictionless border was particularly important to the car industry.

She told workers: “The future post-Brexit is going to be what we make it. We want to get that good deal with the European Union, but we have huge benefits here in the UK, with our entrepreneurship, our innovation, our skillset, our workforces.

“We can really take those opportunities and have that brighter future. Many people said that immediately after the referendum we would see a collapse in our economy. In fact, our economy has continued to grow.”

May came under pressure over securing a Brexit deal after Jeremy Hunt, her new foreign secretary, said on a visit to Berlin that there was now a “very real threat” of ending up with no deal “by accident” because of stalling by EU negotiators.

She claimed that EU partners were starting to focus on the detrimental impact to their own economies, some of which traded heavily with the UK, if they failed to reach agreement before the UK left in March next year.

“What I see is people focusing their minds now on the impact the future relationship will have on their economies as well as ours,” she said. “We’ve had some constructive responses so far. I won’t say that you won’t hear some negative things being said. So we’re going to sit down and talk to people about it.”

The prime minister sidestepped a question over what would happen if parliament rejected any agreement negotiated with the EU, although she confirmed ministers were stepping up preparations for a no-deal Brexit so they were prepared for all outcomes. “My aim is to bring forward a deal that parliament will support,” she said.

Asked how she unwound from “the world’s most stressful job”, May told workers that she enjoyed walking, cooking and watching US television crime drama NCIS.