The DUP would have to revisit its confidence and supply deal with the Tories if Theresa May’s Brexit deal passes through parliament, Arlene Foster has said.
The DUP leader said her agreement with the Conservatives had been intended to provide the UK with national stability and to deliver on Brexit.
She was speaking on Radio Ulster’s Inside Politics programme.
The DUP is holding its annual conference this weekend.
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“If this is not going to deliver on Brexit then of course that brings us to the situation of looking again at the confidence and supply deal.
“But we are not there yet,” she said.
The DUP leader insisted the government should “ditch the Irish backstop” and recognise that, in practice, nobody will implement a hard border on the island of Ireland.
She argued that the prospect of such a hard border has taken on a “mythical status” in the Brexit negotiations.
Mrs Foster argued that the EU Withdrawal Agreement as it stands will not get the support of parliament.
Instead of “wasting time” on the agreement, she said Mrs May should try to secure a better deal.
Mr Hammond will speak at a dinner on Friday night.
He was speaking during a visit to an integrated school in Moira, County Down.
Mr Hammond said the government has a number of choices through the “parliamentary process”, which include extending the implementation period to avoid having to use the backstop.
“I would much prefer to see us extending the implementation period and I am sure my DUP colleagues would take the same view,” he said.
“So we need to look at how we can provide reassurance about how we will use the options that the agreement gives us.”
Boris Johnston will give a speech to the conference on Saturday afternoon.
Mrs Foster said the reference to the potential use of technology to monitor cross-border trade in the latest EU-UK Political Declaration does not change her party’s objections to Mrs May’s Withdrawal Agreement.
She said it would have been much better if both the EU and the UK had explored potential technological solutions to maintaining smooth cross-border trade in the summer of last year, when unionists previously championed the idea.
Mrs Foster said the withdrawal agreement will be legally binding and have the status of an international treaty, so it remains important to the DUP that nothing contained in it damages the UK constitutionally or economically.
Inside Politics is on BBC Radio Ulster on Friday at 18:05 GMT and Saturday at 13:35 GMT.