‘Theresa May will lead country out of the EU’

The chancellor spoke as cross-party negotiations to try to break the Brexit deadlock took place in Whitehall on Friday after the UK’s exit date from the EU was delayed until October 31.

Mr Hammond told Bloomberg: “The Prime Minister has said that she will leave once she has done the deal and taken us out of the European Union. But, as far as I know, she doesn’t have any intention of leaving until that deal is done. She is a person with a strong sense of duty. She feels that she has got a duty, and an obligation to the British people to deliver Brexit and she will certainly want to make good on that obligation.”

Asked about the implications of a Tory leadership contest, Mr Hammond said: “Let’s be honest, we have already got people jockeying for position to succeed her, but that’s just one of those things.”

The chancellor said Labour was not clear if it wanted a new Brexit referendum.

Mr Hammond said: “The Labour Party itself isn’t really clear yet whether it wants to argue for a second confirmatory referendum.

“Some people in Labour do, some people in Labour are very strongly opposed to it. I think this is a very open question at the moment.”

The Prime Minister has made clear she intends to bring her Brexit deal back to the Commons for a fourth time.

Number 10 is still hoping they can get a deal through Parliament in time to avoid the need for the UK to vote in European elections on May 23.