Philip Hammond is going to war with cabinet colleagues over Brexit

The conflict within prime minister Theresa May's cabinet over Brexit is showing no signs of going away, with Chancellor Philip Hammond accusing key ministers of undermining Britain's negotiation position by pushing for a "hard Brexit."

Hammond, who replaced George Osborne as Chancellor when May first took office, is at loggerheads with hardline government Brexiteers over the sort of exit Britain should pursue.

There was talk of him resigning after just weeks in the job earlier this week after colleagues accused him of trying to "undermine" Britain's departure from the EU by expressing concerns over the risks of the UK leaving the European Single Market.

Speaking at a meeting of the Treasure select committee on Wednesday, Hammond claimed Britain's negotiating position was being damaged by ministers who are looking to "close down" certain options, a thinly-veiled attack on Tory ministers like Liam Fox and David Davis who have indicated they want a "hard Brexit."

Hammond told the committee that the prime minister needs "maximum possible space" to negotiate.

He said: "My objective in supporting her is to ensure that she has the broadest range of options, properly costed and understood, and the maximum scope to deploy that broad range of options in what might be a wide-ranging negotiation.

"I would say that those that are undermining the effort are those that are seeking to close down that negotiating stance, seeking to arrive at hard decisions that we don't need at this stage."

As many people predicted, the Tory party is beginning to split over the historic Brexit vote.

Prominent hardliners David Davis, Liam Fox, and Boris Johnson are seemingly charging towards a "hard" deal which will see Britain leave the European Single market. Meanwhile, ministers like Hammond have taken a more cautious approach, while staunch Remainers like Anna Soubry have described the hard Brexit agenda as "bonkers."

The Chancellor also used his appearance at the committee meeting to allay concerns that Brexit will make it more difficult for the City to recruit foreign talent. Reducing immigration to the UK was the most important issue for Brits who voted Leave in the June referendum.

"I cannot conceive of any circumstance in which we would be using those controls to prevent banks, companies moving highly qualified, highly skilled people between different parts of their businesses. That is essential for the smooth operation of our economy," he said.