Brussels terrified ahead of Italy and Austria votes Italian premier Matteo Renzi has promised to resign if he loses this weekend’s referendum, which threatens to shake the financial foundations of Italy and push contagion to other nations in the crumbling bloc. The 41-year-old is proposing sweeping constitutional reforms that would reduce the number of MPs and speed up the political process. However, if his proposals are defeated, opposition parties who are determined to push forward a breakaway from Brussels, and with Brexit increasing anti-EU sentiment across the continent, they will prepare for a fight to topple the Union… Meanwhile, if Norbert Hofer becomes the EU’s first far-right head of state it will signal an unprecedented shift toward right-wing extremism across the continent. – Sunday Express Italians head for polls in referendum as anxious Europe looks on – Sky News This is what Italians are actually voting on in Sunday’s crucial referendum – Business Insider Europe fiddles while Rome burns – Sunday Times editorial (£) Europe depends heavily on the economic performance of Italy – Hamish McRae for The Independent When do the Italian referendum results come in? What to watch out for during vote count – Sunday Express Is front runner in Austria’s presidential race a Neo-Nazi or a great Right hope? – Sunday Mirror European Central Bank on standby by to calm financial markets – Sunday Times (£) Brexit fades from hard to soft to grey Theresa May has given ministers the green light to draw up secret plans for a “grey Brexit” that will steer Britain away from the black-and-white demands of “leave” and “remain” hardliners. Senior Whitehall sources say David Davis, the Brexit secretary, and Philip Hammond, the chancellor, have formed a “small clique” with Downing Street to drive Britain away from a hard exit. Cabinet sources said Liam Fox, the international trade secretary, and Boris Johnson, the foreign secretary, have been bounced into conceding that Britain could keep paying into the Brussels budget even after Brexit. – Sunday Times (£) An intriguing alliance is emerging among cabinet rivals – Sunday Times (£) Pick’n’mix Brexit could let us have our cake and eat it – Iain Dey for the Sunday Times (£) Prime Minister accused of Brexit sell-out after suggestions UK could pay into EU for trade deal – Sun on Sunday Risks to Britain of a hard Brexit – Observer Editorial Theresa May orders Sir Cover-Up to spy on senior ministers and threatens to sack ‘culprits’ who reveal inside secrets Theresa May has made an extraordinary threat to sack senior Ministers and mandarins caught leaking Cabinet secrets amid growing signs of Brexit panic in Downing Street. The Prime Minister has ordered security chiefs to seize mobile phone and email records of anyone suspected of revealing Government splits or secrets. All ‘culprits’ will be sacked in the Big Brother-style crackdown – even if no threat to national security is involved. – Mail on Sunday A leaked memo reveals Theresa May has ordered a crackdown on unauthorised leaks – Mail on Sunday May to face renewed pressure after 200 business leaders warned her to “get on with” Brexit In a letter to the prime minister, the company bosses say it is “vital” that she sticks to her pledge to declare article 50 by the end of March and “preferably sooner”. They warn that being pushed off course would damage investment and trade and cost jobs. The letter was put together by the Brexit pressure groups Leave Means Leave and Change Britain — the first time the two rivals have co-operated. – Sunday Times (£) ‘Plot’ to sabotage Boris Johnson’s plan for Brexit Whitehall sources told The Sunday Telegraph that the Foreign Secretary had been left “absolutely furious” after his views on immigration were misrepresented this week. Anonymous EU ambassadors were quoted in various reports saying that Mr Johnson had privately told them he supports free movement of migrants. The claims were publicly denied by Mr Johnson, who insisted he voiced his usual support for immigration while insisting controls were needed after the Brexit vote. Yet the row triggered a string of damaging headlines as TV broadcasters and newspapers picked up on the claims of chaos over the Government’s immigration stance. – Sunday Telegraph Top Tories say hard Brexit stance could mean losing the next election The Tory party could lose the next general election if Theresa May alienates its core of moderate supporters by imitating Ukip and pushing through a hard Brexit, a group of former Conservative ministers and MPs says. The warning to the prime minister from the party’s senior ranks comes after Tory voters turned to the pro-EU Lib Dems in droves in Thursday’s Richmond Park byelection, delivering one of the biggest electoral shocks of recent times. – The Observer The Tory party ignores this message from moderates at its peril As well as making clear that it will not be pushed into a corner by those who only advocate a hard Brexit, a government decision to publish its objectives for negotiations would not only bring some certainty to the issue, but also be likely to suggest a tone which would be welcomed by a key group of supporters. The vast majority of Conservative voters would unite behind that and the prime minister, trusting her to deliver the best Brexit possible. This would be a good way to learn from 2016, and make the best of the year to come. – Alistair Burt, Dominic Grieve, Claire Perry, Neil Carmichael and Ben Howlett for The Observer Ministers pressing for low-skilled migration to continue after Brexit Cabinet ministers have voiced concerns about the drive to cut EU migration in a number of low-income sectors after Brexit. Downing Street is determined to end free movement and ministers have publicly referred to attracting “the brightest and the best” of highly-skilled workers in future. But privately, some have argued that tens of thousands of low-skilled jobs currently filled by migrants cannot easily be replaced with British labour, if they face shortages. Home Office officials have been holding informal discussions with Government departments calling for unskilled migrants to continue working in sectors including agriculture, hospitality, construction and social care. – Sky News Labour will seek amendment to Brexit bill, Jeremy Corbyn says The Labour leader told Sky News his party wants an amendment to ensure Britain maintains access to Europe’s markets, workers’ rights and environmental protection measures. He said: “When the Article 50 debate comes up, we will put forward an amendment to it, about market access and protections. We want those to be part of the negotiations. We are respecting the result of the referendum. It might not be the one we wanted but it’s the one we’ve got.” – Sky News Labour’s Brexit bill amendments likely to delay Article 50 – Faisal Islam for Sky News UK companies still growing steadily despite Brexit fears British companies continued to grow modestly in the three months to November and are expected to keep up that pace into 2017, a survey showed on Sunday, chiming with a resilient picture for the British economy so far since June’s EU referendum vote. The survey by the Confederation of British Industry’s (CBI) showed private sector growth gathered a little bit of speed compared with the three months to October. Retailers and consumer-facing firms said sale volumes edged higher, reflecting how many British households have continued to spend after the Brexit vote in June. But for manufacturers, growth slowed and the outlook remained sluggish as cost pressures linked to the post-referendum fall in the value of sterling caused many companies to worry about inflation. – Reuters Construction activity reaches eight-month high as delayed projects resume after Brexit vote – Sunday Telegraph Finance expert bashes Brexit scaremongering Silicon Valley based firm Quantiacs, which connects systematic trading strategies with capital from institutional investors, says their data which was studied from 1990 to date proves the “UK’s economic troubles are greatly exaggerated.” And not only that by comparative terms the stock and bond markets behaved like nothing had happened. – Sunday Express Dominic Raab: Supreme Court must respect voters and clear up the Remainers’ anti-Brexit mess with Article 50 judgement Our judges are among the finest lawyers in the world. Yet, as a group, their overall political attitude is widely regarded as submissive to Brussels….Concerns about the “politics of the judiciary” were magnified when the wife of our most senior judge tweeted that the Brexit referendum was “mad and bad”. Then the No2 at the Supreme Court, Lady Hale, gave an ill-advised speech summarising the case, which invited people to speculate that she harboured pro-EU views. The legal profession dashed to defend them. But haven’t they always preached that impartiality requires not just that justice is done, but that it is seen to be done? Fat chance, if people have an inkling that the judges in a case may be biased. – Dominic Raab MP for the Sun on Sunday The High Court’s Brexit ruling is a product of our ‘post-truth’ age – David Green for The Spectator’s Coffee House blog Our judges must be above suspicion – Sunday Times editorial (£) How to watch the Supreme Court Brexit case live online – Sunday Express John Longworth: Don’t let the Remain wreckers and anti-democrats defy the will of the British people Since both sides of the post-Brexit vote reality now seem to agree that the British Parliament is sovereign (though I didn’t witness much support for this from the courts in the past, with regard to the ECJ), it must be incumbent on the Government to bring forward Parliamentary debate on Article 50, as narrowly defined as possible so as not to undermine our negotiating position, as soon as possible, thereby reasserting that it is Parliament and the will of the people that reign Supreme. – John Longworth for ConservativeHome Keir Starmer: Tories must publish Brexit plan or there’s zero chance of getting a good deal Labour accepts and respects the referendum result. We recognise Britain is leaving the EU and we will not frustrate the process that leads to that. But we will also fight for a Brexit deal that is in the national interest – not in the interest of the 52% or the 48%, but for the 100%. Labour’s motion in the Commons on Wednesday is an important step in that process. It calls for a basic plan – not the finer detail or minutiae of a negotiating position, but a basic plan – for Brexit to be put before the public and parliament. On the defining issue of our time, that surely is not too much to ask. – Keir Starmer MP for The Observer Brexit comment in brief Church of England jumped on ‘middle-class Brexit bandwagon’, bishop says – BBC With the Tories still clueless about what Brexit means, it is time to look at what the Swiss deal means – Emma Reynolds MP for Labour List Starting in China, Adele and the Bard can help us build a global Britain – Karen Brady MP for the Sunday Times (£) David Davis has emerged as the most impressive of the Brexit ministers – John Rentoul for The Independent Richmond’s slap in the face is good for the PM – Adam Boulton for the Sunday Times (£) Brexit news in brief “We’re victims of Revenue witch hunt” says Aaron Banks – Sunday Times (£) Boris Johnson causes another cabinet rift as he tears up government policy and backs EU army – Sun on Sunday Conservatives hope Le Pen Presidency will speed up Brexit – Sunday Express Calls for Sturgeon to lead second EU referendum campaign for all of UK – Sunday Herald Brexit will lead to cheaper food if right policies adopted, says OBR official – Sunday Telegraph Civil servants take acting lessons in a bid to improve performance abroad post-Brexit – Sunday Express