1) For months the Government has dodged the question of what their desired Brexit end-state is. Internal discussions have considered both a so-called "EEA minus" or "CETA plus" model but publicly the PM has insisted that she wants a bespoke deal - unlike Canada or Norway
2) The Cabinet is clearly divided on this question - with Hammond/Clark/Rudd on one side and Brexiters (plus Gavin Williamson) on the other, and a group of relatively undecideds in the middle
3) Hammond's public calls for a Brexit which only leads to "very modest" changes & his explicit defence of the 4 freedoms of EU risks breaking the delicate balance which has held the Government together
4) Even more damaging - arguably - is No10 not moving to clarify the Chx's comments. That suggests that the PM who previously had positioned herself as the defender of a Brexit that actually meant leaving the EU could be shifting.
5) Hammond resisted the commitment made at Lancaster House (and more explicitly in the Article 50 letter) to leave the Customs Union - and insisted that an option of a parallel customs model was kept on the table in the Government's position paper
6) Since then he has pushed hard for a regulatory approach which would entail keeping everything the same (nothing will change!) unless we get agreement to diverge - ie we could have to ask the EU for permission to make changes.
7) If (and I haven't seen his full comments in context) Hammond is backing the CBI on the need for "a comprehensive UK-EU customs union" this suggests he's moved away from the 2017 Conservative manifesto position.
8) Of course there's a difference between staying in THE EU Customs Union and forming A new Customs Union...but the difference is relatively small. Either would substantially impede the UK's ability to have an independent trade policy, sign trade deals and control its markets
9/9) In all, Hammond's comments (plus Karen Bradley's remarks from Tuesday) risk opening a severe public row over Brexit. It would be better to avoid such a row but we do need an answer to the question of where we want to end after Brexit - it's just that Hammond has got it wrong
