Leave Means Leave, which is supported by more than 50 Tory MPs and MEPs, has said that Mrs May must not bow to pressure from the Germans to commit in writing to paying a divorce bill.
It comes as a senior MEP has claimed that Brussels is “panicking” over the increasing prospect of “no deal” as it finally orders preparations to begin for trade talks with the UK.
The European Commission’s chief negotiator Michel Barnier on Thursday claimed there was “deadlock” on talks and refused to move the negotiations on to trade because of a lack of progress on a divorce bill.
But, Mr Barnier was immediately undermined by a draft paper submitted to Donald Tusk, the President of the European Council, which represents member states’ governments, saying trade talks could begin in December.
50 Tory MPs and MEPs have stated that Mrs May must offer no more concessions in Brexit talks
Mrs May’s Florence speech was intended to break deadlock in discussions through generous concessions
Brussels is panicking because they know that without a deal they will get no money at all and tariffs will hurt them more than they will hurt Britain
The internal document suggested that the other 27 members start preparing for the trade talks.
It is only Angela Merkel’s German government which is understood to be trying to block trade talks in the hope Britain will commit to pay billions of pounds as a divorce bill.
Writing for the Daily Express online, John Longworth, the joint chairman of Leave Means Leave, said that after Theresa May’s Florence speech there must be “no more concessions” to get the EU to move the talks on to trade.
He said: “The Prime Minister’s Florence speech was a generous offering of the cup of kindness to a cash strapped European Commission, designed to unlock a reciprocal wave of warmth at the negotiating table.
“Unfortunately, the proposition failed to recognise the game plan of the Commission, which is to put increasing pressure on the UK to give more money and concessions by delaying any conversations on a deal and thereby ensuring that the UK is ‘punished for Brexit’, in order to teach the rest not to think to do the same.”
Comparing the talks to Neville Chamberlain’s Munich crisis 80 years ago before the Second World War, he warned against the UK “appeasing” the EU.
He said: “The lesson is to bite the bullet early and stop trying to buy time.
“This means there must be no more concessions from this Government to persuade the EU to move on to a trade deal.
Thesesa May arriving for the second day of the EU summit, focusing on globalisation and migration
“Let us hope that this time the government stop appeasing and instead start to prepare to leave with no deal and crystallise the manifest economic benefits of doing so, rather than merely planning for it.
“Then and only then will we be richer out of the EU, than we otherwise would have been by staying in.
“Ironically, it may also, incidentally, produce an EU free trade arrangement, desirable although by no means essential, and certainly not at any price.”
Leave Means Leave and Economists for Britain have argued that “no deal is the best deal” for the UK because it will free up the British economy with no strings atached and no further payments to the EU.
It is estimated that free of Brussels rule just on World Trade Organisation (WTO) rules, the British economy could grow by £150 billion a year through deregulation, free trade agreements and tax breaks.
Tory MEP David Campbell Bannerman, who sits on the European Parliament Brexit steering group and the trade committee, said that the move in Brussels to start preparing for trade talks had come about because “the EU is finally waking up to the fact that the UK Government is ready to walk away from talks.”
With the UK reportedly preparing to recruit another 2,000 civil servants to get ready for Brexit, particularly a no deal, the stakes have been raised in the talks.
Mr Campbell Bannerman said: “They are panicking in Brussels because they know that without a deal they will get no money at all from us and tariffs will hurt them more than they will hurt Britain.”
Member states like Denmark are exerting increasing pressure to commence trade talks with the UK
He pointed to pressure mounting from member states led by Denmark to get on with trade talks as quickly as possible.
Anders Vistisen, a Danish MEP and vice-chairman of the EU Parliament’s foreign affairs committee, agreed, said: “The most integral thing is the future relationship.
“If we are making a bad trade deal for Britain we are also hurting ourselves.”
Meanwhile, a leading German MEP, Bernd Kolmel, chairman of Germany’s Eurosceptic Liberal Conservative Reformers, said that the Commission’s refusal to move on to trade talks was a “disaster.”
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Even the head of the International Monetary Fund Christine Lagarde, a former French finance minister, has attacked the European Commission for dragging its feet over trade talks.
She said: “Brexit is an ongoing process and our hope is that it be conducted promptly to reduce the level of uncertainty and the anxiety of people about the outcome and the situation of people first, of business second.
“Because this is affecting the people and the businesses.”