UK's May steps up calls for Labour to agree a Brexit deal

LONDON (Reuters) - British Prime Minister Theresa May has stepped up calls on Labour Party leader Jeremy Corbyn to agree a cross-party deal to leave the European Union, following poor results for both parties in local elections on Thursday.

May's Conservatives lost more than a thousand seats on English local councils that were up for re-election, and Labour - which would typically aim to gain hundreds of seats in a mid-term vote - instead lost 81.

Both parties have been locked in talks for the past few weeks to try to broker a Brexit deal that can get a majority in Parliament, after May's minority government suffered three heavy defeats on her preferred deal earlier this year.

Senior Conservatives said on Saturday there was an increased need for compromise after the local election results, and the leader of the Scottish branch of the Conservative Party said a deal with Labour could be done within days.

May added her voice to these calls in an essay published in a Sunday newspaper.

“To the Leader of the Opposition I say this: Let's listen to what the voters said in the local elections and put our differences aside for a moment. Let's do a deal,” she wrote in the Mail on Sunday.

The Sunday Times reported that the Conservatives would offer new concessions to Labour when talks restart on Tuesday, including a temporary customs union with the European Union, which would last until a national election due in June 2022.

“At that point Labour could use their manifesto to argue for a softer Brexit if they wanted to and a new Conservative prime minister could argue for a harder Brexit,” a source cited by the Sunday Times said.

Labour's Corbyn has made a permanent customs union with the EU a condition for supporting May's Brexit plans, while the Conservatives oppose a customs union as it would stop Britain from reaching its own trade deals with other countries.

Any customs union would likely upset the most pro-Brexit members of the Conservative Party, while the Observer newspaper reported that scores of Labour lawmakers had written to Corbyn to insist on a second Brexit referendum.

Veteran Brexit campaigner Nigel Farage, whose new Brexit Party hopes to make big gains in the European Parliament, wrote in the Sunday Telegraph that a Conservative-Labour Brexit deal involving a customs union would be a “coalition .... against the people.”

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Labour may also judge that the Conservatives have more to lose electorally if the Brexit stalemate continues until the European Parliament elections due on May 23.

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“Breaking the impasse can't just be a question of bailing out the government,” Labour Brexit spokesman Keir Starmer told Sky News on Saturday.

Moreover, a temporary customs union is likely to raise EU concerns that it could lead to customs checks on the border between Ireland and Northern Ireland if it later breaks down - something EU member Ireland objects to strongly.