In an interview ahead of this week’s Budget, the Chancellor said: “Whatever is due we will pay.”
He also claimed Britain would meet financial obligations to the EU “in accordance with international law”.
His remarks risked enraging Cabinet Euro-sceptics including Boris Johnson and David Davis who are opposed to increasing the current £18billion offer unless EU leaders allow trade talks to begin.
They also deny Britain is legally obliged to pay anything to Brussels.
Whitehall insiders fear angry clashes today when senior ministers gather at a Cabinet sub-committee set up to discuss the Brexit negotiations.
Philip Hammond said the Government may raise the amount of taxpayers cash offered to Brussels
It’s about what is properly due from the UK
Mr Hammond indicated his readiness to hand over more cash to Brussels in an interview on the BBC1 Andrew Marr Show yesterday.
“It’s not about demands; it’s about what is properly due from the UK to the European Union under international law in accordance with the European Treaties,” he said.
“We’ve always been clear that it won’t be easy to work out that number, but whatever is due we will pay.
“We’re a nation that honours our debts.
“And of course we’ll negotiate hard where there is any question, any doubt about whether an item is payable or not, but those debts that are clear, of course we will pay.”
Senior Tory MP Jacob Rees-Mogg, a leading Brexit supporter, warned that the Government was in danger of falling into a “trap” set by Michel Barnier and other EU negotiators.
“The EU is saying they want us to settle the money first – that is their negotiating position; that is not holy writ.
“The Government doesn’t have to follow that. And they need our money,” Mr Rees-Mogg said.
“Our negotiating position on money is very strong, and we shouldn’t fall into the trap of thinking just because Monsieur Barnier has said it, it is as if he has received tablets of stone like Moses. He hasn’t.”
In his interview, Mr Hammond attempted to strike an upbeat note about Britain’s prospects outside the EU.
Philip Hammond on the Andrew Marr Show
“I think Britain has a very bright future ahead of it, and we have to embrace the opportunities that the post-Brexit world will offer,” he said.
But the Chancellor refused to say that his mind had changed since backing Remain in last year’s EU referendum.
“There isn’t a vote now; there isn’t going to be a second referendum.
“We’ve had our debate, we’ve made our decision and I am committed as is every member of the Cabinet, to getting on and delivering Brexit as quickly and as cleanly as possible, doing it in a way that protects British jobs and British prosperity so that we can reap the benefits and the opportunities that are available to us in the post-Brexit world,” he said.
Remain-backing ministers including Jeremy Hunt and Liz Truss have both said they would now vote to Leave the EU if given the choice.
Philip Hammond on ‘Peston On Sunday’
Mr Hammond yesterday confirmed that his Budget on Wednesday will set out plans for building 300,000 new homes a year to tackle the country’s housing shortage.
“We’ve got to be sustainably delivering around 300,000 homes a year on average across the housing cycle.
“And that’s a big step up from where we are now.
“There is no single magic bullet and it’s certainly not just about pouring money in because if you pour money in without fixing the other elements of supply, you will simply create more house price inflation,” he said.
Mr Hammond’s Budget will also commit the Government to investing £80billion in research and development projects over the next 10 years to promote new technology, it emerged last night.
Mr Hammond’s Budget will also commit the Government to investing £80billion in research
The Chancellor wants research and development to account for 2.4% of the country’s Gross Domestic Product by 2027, compared with 1.7% at present.
In a newspaper article last night, Theresa May wrote: “One of my first actions as Prime Minister was to begin the development of a modern industrial strategy that will help businesses to create high-quality, well paid jobs right across the country.
“This is a new long-term approach to shaping a stronger and fairer economy for decades to come.
“It helps young people to develop the skills they need to take up the high-paid, high-skilled jobs of the future.
“Our Industrial Strategy will propel Britain to global leadership of the industries of the future, seizing the big opportunities of our time – from Artificial Intelligence and Big Data to clean energy and self-driving vehicles.”