Theresa May has said the media were responsible for a slump in the value of the pound by wrongly claiming her views about Britain leaving the EU equated to a hard Brexit.
The prime minister was responding to a question about the negative market reaction to her comments on Sunday when she hinted that the UK would not be able to remain a full member of the European single market, but would instead have to negotiate a new trade deal.
After a speech in London, May was asked if the markets were getting her vision of Brexit wrong, or if she was getting it wrong. She said: “I am tempted to say that the people who are getting it wrong are those who print things saying I’m talking about a hard Brexit, it is absolutely inevitable it is a hard Brexit. I don’t accept the terms soft and hard Brexit.
“What we are doing is going to get an ambitious, good and best possible deal for the United Kingdom, in terms of trading with and operating within the European single market.”
The German chancellor, Angela Merkel, repeated her position that failure to accept the EU’s “four freedoms” would lead to restricted access to the single market.
Speaking at the annual meeting of the German Civil Service Federation, she said: “Access to the single market can only take place under the condition that you keep the four freedoms [movement of goods, capital, services and people].“If that’s not the case, you have to negotiate curtailments.”
Merkel, who is running for a fourth term in the German election this year, said: “One can’t carry out these negotiations as an exercise in cherry-picking. That would have fatal consequences for the other 27 member states, and we can’t allow such consequences.”May also stressed that it would have to be a “new relationship”, because Britain would no longer be a member of the EU. “We will be outside the European Union and therefore we will be negotiating a new relationship across not just trading, but other areas with the European Union,” she said.
Asked about Merkel’s comments, a Downing Street spokeswoman said: “We are about to enter a negotiation with 27 other countries. The British people made clear it’s important we take control of immigration, but this shouldn’t be a zero-sum game and we should be approaching this on how we can get the maximum freedom for UK businesses to operate in and trade with the single market.
“There are many countries around the world that have free trade arrangements with the EU.”The prime minister also used her first speech of the year to flesh out her vision for a “shared society”, first outlined on the steps of Downing Street.
May said the time had come for a “new philosophy” of fairness and solidarity, saying Brexit was a once-in-a-generation chance to step back and decide what type of country Britain wanted to be.
Many of her comments will be seen as being aimed in part at her Conservative predecessor, David Cameron, and other politicians such as Tony Blair.
In particular, May attacked the failure of “mainstream, centre-ground politics” to respond to public concerns in recent years, which had resulted in people turning to “the politics of division and despair”.
“We see those fringe voices gaining prominence in some countries across Europe today – voices from the hard left and the far right stepping forward and sensing that this is their time.
“But they stand on the shoulders of mainstream politicians who have allowed unfairness and division to grow, by ignoring the legitimate concerns of ordinary people for too long.”
She said centrist politicians had embraced the “great forces” of liberalism and globalisation, but failed to understand that too many people on modest and low incomes saw those as things to be “concerned, not thrilled about”.
The prime minister said she was talking about politicians who had supported an economic system that worked well for a privileged few but failed to ensure the prosperity was shared across the country.
“[These are] politicians who made the deals and signed the agreements that changed the nature of their country, but failed to listen to the public’s concerns – dismissing them as somehow parochial or illegitimate instead,” she said.
She said people were questioning whether globalisation was working for them when they were losing their jobs and watching their wages stagnate. “They come to a simple conclusion: that there is one rule for the rich and powerful, and another for everyone else,” she said.
May said her government’s challenge was to show that centre-ground politics could deliver change, respond to concerns and set things right.
The prime minister outlined the key social injustices on which she wanted to focus: racial discrimination, poor life chances for white working-class boys, gender inequality and difficulties for young people.
She then focused her speech on new mental health policies, which had been trailed over the weekend. “An estimated one in four of us has a common mental disorder at any one time. The economic and social cost of mental illness is £105bn – roughly the same as we spend on the NHS in its entirety,” she said, promising to focus in particular on children.
May gave her speech exactly a year after Cameron delivered a major speech on the same subject, in which he pledged £1bn of extra funding for mental health. May did not provide additional funding on top of that, but offered a strengthened package on mental health, including piloting approaches within schools to identify and support children in need.
The prime minister has also commissioned two reviews, one of services for young people and the other on wellbeing in the workplace.
May was asked whether she would ringfence government funding for mental health, given concerns that general pressures on the health service could squeeze this. She would not offer such a commitment, but insisted there would be accountability.
The prime minister said there was a need to recalibrate policy so it was not only about the poorest. “Government and politicians have for years talked the language of social justice, where we help the very poorest, and social mobility, where we help the brightest among the poor,” she said.
“But to deliver the change we need and build that shared society, we must move beyond this agenda and deliver real social reform across every layer of society, so that those who feel that the system is stacked against them – those just above the threshold that attracts the government’s focus today, yet who are by no means rich or well off – are also given the help they need.”
Despite insisting that the government would continue to focus on the most disadvantaged as well, some campaigners fear that May’s positioning will reduce the focus on the least well-off in society.