Theresa May left hanging by DUP masters after they refuse to sign off on Ireland deal

Mrs May speaking at PMQs today
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Theresa May was plunged into a growing Brexit crisis today as the Democratic Unionist Party flatly refused to sign off a deal with Ireland.

The Prime Minister failed to make a breakthrough in telephone talks this morning with DUP leader Arlene Foster.

Earlier Mrs Foster had warned she would “not be rushed” into an agreement on the Irish border issue. Labour leader Jeremy Corbyn claimed in the Commons that the 10 DUP MPs who prop up Mrs May’s minority government were “ruling the roost” and the “tail really is wagging the dog”.

The Irish government heaped further embarrassment on Mrs May by revealing that the phrase at the heart of the row — “continued regulatory alignment” — had been agreed between the Prime Minister and her Irish counterpart, Leo Varadkar, before it was leaked on Monday, causing uproar within the DUP, who had been kept in the dark.

With the deadline fast approaching for a breakthrough well before next week’s crucial summit of European Union leaders, Mrs May was confronted by growing challenges on the back of the Northern Ireland dispute.

The Tory civil war over Brexit deepened as MPs said the prospect of continued “alignment” between the UK and EU opened the way for the UK to stay inside the world’s biggest trade bloc, the single market.

Brexit Secretary David Davis admitted Brexit would provoke a “paradigm change” for the economy, comparable with the way the 2008 crash rendered economic models obsolete.

MPs called on Mr Davis to resign for allegedly misleading Parliament — and moves were afoot to have him censured for failing to give a Select Committee official papers on studies into the impact of Brexit on the economy.

A bid to do a deal with Brussels was scuppered on Monday when the DUP, Northern Ireland’s largest party, vetoed the wording of “regulatory alignment”, fearing it would split the province from mainland UK.

The call between Mrs May and Mrs Foster was postponed yesterday to allow more time for private talks, but sources said the leaders failed to narrow the gap between them and “technical” discussions would have to continue.

The Irish government said it would not change the wording but was willing to add some words to clarify. It said it had “concrete evidence of an agreement between the Taoiseach and Prime Minister” and added: “We absolutely feel we can’t budge one inch.”

Mrs Foster has said her party was only shown the proposed text regarding the Irish border late on Monday morning, as Mrs May was sitting down to lunch in Brussels with European Commission president Jean-Claude Juncker.

At a Nato summit in Brussels, Foreign Secretary Boris Johnson appealed to all sides to shelve decisions on the border issue until trade talks were under way.

“The best way to sort it out is to get on to the second phase of the negotiations, where all these difficult issues can be solved,” he said.

Today Mr Davis told the Brexit select committee that the Government has made no formal assessment of the likely impact of Brexit on different sectors of the UK economy. Members said he had contradicted earlier evidence.

Lib-Dem committee member Wera Hobhouse said: “David Davis has been misleading Parliament from the start.” Giving evidence, Mr Davis said Brexit would be of the “order of magnitude” of the 2008 crash. He said: “I’m not a fan of economic models because they have all proven wrong. When you have a paradigm change — as happened in 2008 with the financial crisis — all the models were wrong.”

Tories opposed to a hard Brexit said Mrs May’s policy of “regulatory alignment” was the basis for a Norway-style trade deal within the European single market of 500 million customers.

John Stevenson, Tory MP for Carlisle, said there was “a lot of support” in Parliament for being members of the European Free Trade Association, which includes Iceland, Norway and Switzerland. Nicky Morgan, who chairs the Treasury Select Committee, said: “There cannot be a separate deal for part of the UK.” But Tory Right-winger Nigel Evans branded the idea a “Hotel California solution — where you can check out but never leave the EU”.

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