THE Prime Minister’s grip on her government is weakening, with two of her ministers undermining her claim that no deal is better than a bad deal.

Chancellor Philip Hammond told a CBI lunch at the World Economic Forum in Davos, Switzerland, that leaving the EU without an agreement would be a “betrayal” of voters, while junior minister Richard Harrington effectively dared the Prime Minister to sack him, after he warned about the dangers of a no-deal Brexit.

It came as aerospace giant Airbus said leaving the EU was forcing them to make difficult decisions – potentially putting 120,000 jobs at risk.

At the lunch, Hammond said: “In the 2016 referendum a promise was made to the majority who voted for Brexit – that they were voting for a more prosperous future. Not leaving would be seen as a betrayal of that referendum decision.

“But leaving without a deal would undermine our future prosperity, and would equally represent a betrayal of the promises that were made.

“And that is why I, having campaigned vigorously to remain in the referendum, have come to believe that the only credible and sustainable solution is for us to leave the European Union, to honour the referendum decision, but to do so in a way that protects our economy in order to allow us to deliver that future prosperity that those voters were promised when they voted to leave the EU.

“The only sustainable solution is a negotiated settlement with the EU.”

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Shadow chancellor John McDonnell said Hammond should resign.

The Labour MP said: “The Chancellor must now surely consider his position in the Government. Philip Hammond’s comments today demonstrate he has acknowledged the damage a no-deal Brexit would do to our economy, jobs and living standards.

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“If the Prime Minister fails to listen to his warnings and continues to refuse to take no deal off the table there is no other option, he must resign.”

Earlier, in an statement, Tom Enders, the chief executive of Airbus, said Britain crashing out of Europe without an agreement could see the firm, who employ more than 14,000 people in the UK with around 110,000 more jobs connected in supply chains, including hundreds in Scotland, forced to make “potentially very harmful decisions”.

Enders called the drawn-out Brexit negotiations a “disgrace”.

He added: “Brexit is threatening to destroy a century of development based on education, research and human capital,” he said.

“If there’s a no-deal Brexit, we at Airbus will have to make potentially very harmful decisions for the UK.”

According to The Guardian, Harrington then told an audience of German industrialists that he agreed with Enders.

“This is a disaster for business and business needs to know where it is, and that doesn’t mean ‘Oh great, two weeks before we are leaving, now we can rule out crashing out’.

“I really don’t believe in this idea. I am very happy to be public about it and very happy if the Prime Minister decides I am not the right person to do the business industry job.”

He added: “I was delighted to read Airbus’s comments this morning because it is telling it like it is.”

According to its website, the company spends “in excess” of £5 billion per year with UK suppliers.

The threat of huge job losses came as the Prime Minister met with trade union leaders in a bid to try to win left-wing support for her Brexit deal.

The Tory leader promised new compromises on the political declaration – which sets out the UK’s future relationship with the EU – would include guarantees for workers’ rights.

However, the trade unionists weren’t having it. TUC general secretary Frances O’Grady said: “We have a Prime Minister on a temporary contract – she cannot bind the hands of a future prime minister.”

She urged the Tory leader to “stop playing to just the bad boys at the back of the class and listen to others for a change”.

Meanwhile, Dave Prentis from Unison said a “no-deal Brexit must be avoided at all costs”.

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He told reporters: “However people voted in June 2016, no-one – especially those who are just about managing – was choosing to be worse off.”

The meetings came ahead of next Tuesday’s vote in the Commons when MPs will be able to back amendments to change May’s deal.

Jeremy Corbyn said his party have not yet decided to back one in the name of Labour MP Yvette Cooper, which would, effectively, delay Brexit.

Speaking on Thursday, he said he had met with Cooper to discuss her proposition: “I understand what she is saying, there is a lot of merit in it. We, as a party, will make a decision,”

Meanwhile, in the House of Lords, Norman Tebbit was jeered when he said a hard Brexit would be good for drinkers looking for cheaper alcohol in pubs.

Tebbit pointed to Wetherspoons, where Brexit-backing boss Tim Martin has announced plans to replace EU alcohol with alcohol from outside the bloc.

“The customers are getting better and cheaper liquor and the company is making better profits. Isn’t that a typical result of leaving with no agreement?” Tebbit asked.

Brexit minister Martin Callanan said he wasn’t sure he wanted to give advice to Wetherspoons on their purchasing policies.