Michael Gove has put the chances of a Brexit deal at “less than 50%”, after the European Parliament set a new hard deadline for talks to conclude.
Presidents of the parliament’s political groups warned that MEPs will not have time to ratify an agreement this year unless it is ready by Sunday night.
EU chief negotiator Michel Barnier said it was “difficult” for a deal to be struck in the European Parliament’s timeframe, but said “good progress” is still being made.
The decision prompted Mr Gove to tell the Commons Brexit committee the “most likely outcome” now was that the current transition period would end on December 31 without a deal.
“I think, regrettably, the chances are more likely that we won’t secure an agreement. So at the moment less than 50%”, he said.
Mr Gove, appearing before MPs, said the Government will not seek to negotiate a fresh trade agreement with the EU next year if they cannot reach a deal before the end of the Brexit transition period.
He said that December 31 is a “fixed point in law” when the transition must end.
“That would be it. We would have left on WTO (World Trade Organisation) terms,” he added.
“It is still the case, of course, that there would be contact between the UK and European nations and politicians, as one would expect.
“But what we would not be doing is attempting to negotiate a new deal.”
An independent coastal state
Mr Gove said that though talks with the EU had made progress, “significant” differences between the two sides remained.
On fisheries, the Cabinet Office minister hinted that the sides were approaching some form of agreement. however.
He said: “The most important thing to stress is that, in international law, the UK will be an independent coastal state and it’s very important that that is recognised by the EU.
“But it’s also the case that it will take a little bit of time for the UK fishing fleets to expand in the way that we’d want to take advantage of the additional capacity that will be available to catch.”
Mr Gove said as a result there would be a “staged approach”, whereby quotas for EU fishermen would gradually decrease and then increase for UK fishermen.
Asked to give a timetable for such a staged approach, Mr Gove declined – stating only that the EU offer of a 10-year fishing transition is unacceptable.
If an agreement is not reached by December 31, the UK will have to trade with the EU on World Trade Organization rules, meaning taxes on goods being bought and sold between the two may be introduced, which could lead to higher prices.