Theresa May to warn Cabinet to put an end to leaks

Philip Hammond and Theresa May

He claimed he was being smeared by fellow ministers who disagreed with him because he is pushing for a softer Brexit.

'Later in the meeting both Boris Johnson and the PM said we should not say public sector workers are overpaid'.

"I don't see these great divisions that are suggested to me in the Sunday newspapers and I have to say I think all of this is somewhat overplayed", he told BBC Radio 4's Today programme.

Asked if there was now a fight under way within the Cabinet to succeed Theresa May as Conservative leader, he said: "I certainly hope not. If there is, I am no part of it".

In particular, Boris Johnson has joined a list of prominent ministers demanding a rethink over the public sector pay cap, which now limits annual salary increases for the likes of nurses and firefighters to one per cent.

The chancellor was grilled on Sunday morning by the BBC's Andrew Marr over reports he told ministers in a cabinet briefing that public sector workers such as firefighters and police officers are "overpaid". After seven years of a punishing pay cap, all public sector employees need a pay rise. "What is key is we have to strike the right balance between being fair in pay to public sector workers and fair to tax payers to ensure we still have a strong economy so we can employ and pay those public sector workers".

The Sun reported yesterday that the Chancellor had been accused of sexism for saying that women can now drive trains because they have become so simple.

From left Justice Secretary David Lidington Environment Secretary Michael Gove Attorney General Jeremy Wright and Northern Ireland Secretary James Brokenshire leave the Cabinet meeting

"I think now you would find that pretty much everybody around the Cabinet table accepts that there will be some kind of transition."

The chancellor denied making the latter comment - he said he was making the point it was outrageous there were not more female train drivers - but did not deny making the comments about pay.

Hammond's confidence in the consensus over such an arrangement, whereby there would be a longer period to negotiate the terms of leaving than the two year period offered by triggering Article 50, comes after new meetings between business and government commenced. "The chancellor's remarks are nothing short of offensive", said Ms McAnea.

He added there was now an acceptance among senior ministers there would have to be a transition period of about two years after the United Kingdom leaves the European Union in 2019 to avoid a "hard landing" for business.

International Trade Secretary Liam Fox and Tory grandee Iain Duncan Smith demanded an end to the damaging infighting today.

Taken together, the stories appear to be evidence of a concerted campaign of negative briefing against Mr Hammond, who is widely regarded as the most senior Remain supporter in the Cabinet and has has sometimes been treated with suspicion by Leave-supporting colleagues.

Fox said his Cabinet colleagues needed to keep "very quiet" and stick to their own departments.