Rishi Sunak engulfed in new Brexit row over Swiss-style EU deal

Rishi Sunak has insisted that a Swiss-style Brexit deal with the EU is off the table, as he moved to quell a backlash among Tory MPs.

Number 10 sources rejected as “categorically untrue” a suggestion by senior government figures that bespoke Swiss-style trade deals with the EU could be sought, potentially forcing Britain to align with the bloc's rules and regulations.

The claims sparked a backlash at the weekend from leading Brexiteer MPs who warned it would be a betrayal of the freedoms won in the 2016 referendum. At least one contacted Number Ten to seek reassurances.

The 'Swiss model' sees Switzerland outside the EU but with access to the single market by matching EU rules and regulations. Senior government sources claimed the move could take place over the next decade as the Government eyes up a closer relationship with the EU that avoids the current barriers to trade, according to the Sunday Times.

However, a government source said: “Brexit means we will never again have to accept a relationship with Europe that would see a return to freedom of movement, unnecessary payments to the European Union or jeopardise the full benefit of trade deals we are now able to strike around the world.”

It comes as Mr Sunak is set to address the Confederation of British Industry (CBI) on Monday, where he is expected to set out some of the key economic principles that will govern his premiership. One will be an emphasis on the need to boost research, development and innovation.

Growing Tory backlash over Autumn Statement

The Prime Minister also faces two days of Commons debate over the Autumn Statement, with Tory MPs warning of a growing backlash from grassroots Tories.

"I think amongst membership there is a lot of reticence to accept the Autumn Statement," one influential Tory said. "It is distinctly unconservative."

Another Tory MP said: "As we head into recession, I don’t think putting taxes up even further than they already are is the way forward. It will stifle all the things they want."

On Sunday, Health Secretary Steve Barclay, a former Brexit secretary, said he did not recognise the idea of Swiss-style deals and did not support it. “I want to maximise the opportunities that Brexit offers," he told Sky's Sophy Ridge on Sunday programme.

'Swiss model right way for us to go forward'

Former Cabinet minister Liam Fox said there had always been some “senior ministers” who preferred a Swiss solution post-Brexit, but told The Telegraph that he had been reassured the Government was “unequivocally opposed” to it as he warned such a debate was a distraction as ministers sought to stabilise the economy.

“Only a complete madman would suggest reopening this debate in the Conservative party at this time. From the Prime Minister down, the Government has been very clear that we have a settled Brexit solution and that we have no intentions of reopening it,” he said.

However, Lord Price, a former trademMinister in the run-up to and after Brexit, said a Swiss-style deal with the EU would be the “right way for us to go forward.” He called for the Government to adopt a pragmatic approach to establish a good relationship with the EU.

“I've always felt that if we weren't going to re-join the EU or become a member of the EEA, which means that we would have to adopt again all EU legislation, the Swiss model was the right way for us to go forward,” he told Radio 4’s The World This Weekend .

Last week Jeremy Hunt said he had “great confidence” that in the years ahead the “vast majority of trade barriers” with the EU would be removed amid moves towards closer economic ties.

But he made clear it would not see the UK joining the EU single market and, it is understood, has explicitly rejected any arrangements involving alignment with, or adoption of, EU law.

Tony Danker, the CBI’s general secretary, will use the organisation's conference to urge ministers to end the arguments over Brexit - in particular the unresolved row with the EU over the Northern Ireland protocol - and use immigration to solve worker shortages in a bid to boost growth.

“Still we argue over the Northern Ireland Protocol. Still, we argue over sovereignty. Get round the table, do the deal, unlock the Trade and Cooperation Agreement. I say to Brexiteers, the best guarantor of Brexit is an economy that grows,” he said.

"Let's have economic migration in areas where we aren't going to get the people and skills at home any time soon. In return, let's make those visas fixed term."