Berliner Tageblatt - UK defends Brexit deal despite economic woes

Hunt, who voted to remain in the European Union at the 2016 referendum, was rumoured to be the source of a report last weekend that the government was eyeing a "Swiss-style" deal with Brussels.

But he scotched talk he was the "senior government figure" quoted in the article, which has threatened to reopen deep divisions in the ruling Conservatives over the form Brexit should take.

The government supports the trade and cooperation agreement (TCA) struck with the EU, he told the influential cross-party Treasury Committee in parliament.

"We think it is an excellent agreement," he added.

"We do not support, we would not contemplate, I do not support, I have never contemplated, any agreement which means moving away from the TCA.

"That means we are not negotiating or deciding the regulations that we want as sovereign equals, paying unnecessary money to the EU or indeed compromising on freedom of movement.

"That has always been my position as Chancellor (of the Exchequer)."

He added: "With respect to the story in the Sunday Times, if you're saying was the Treasury, was I, the source for any suggestion we should seek to renegotiate the TCA to move it towards an agreement more like the agreement with Switzerland, the answer is no."

- Tough going -

Former UK prime minister Theresa May proposed a similar deal, which was roundly rejected by lawmakers, and which contributed to her downfall in 2019.

May's successor, Boris Johnson, railroaded his own "harder" Brexit deal through parliament on the back of a landslide 2019 general election win fought on a campaign to "get Brexit done".

But despite promises of greater freedoms to set policy and chart its own course in the world, the UK has found post-Brexit life tough going, even without the shock of the Covid pandemic.

The Bank of England and the government's independent spending watchdog have both said Brexit has hurt the UK economy and plunged it to the brink of recession.

On Tuesday, the Organisation for Economic Co-operation and Development forecast the UK economy would contract more than any of the world's seven most advanced nations next year.

Many critics have partly blamed the fallout from Brexit, which saw the UK withdraw from the European single market and customs union, and end free movement between member states.

Switzerland has far closer ties with the bloc through bilateral agreements allowing access to the single market, a high degree of free movement and by paying into EU coffers.

But on Monday, British Prime Minister Rishi Sunak ruled out pursuing "any relationship with Europe that relies on alignment with EU laws" as eurosceptic Tories warned of backsliding.

The European Commission says no Swiss-style deal is on the table.

Hunt last week hiked taxes and slashed spending, to try to reverse unfunded tax cuts by his predecessor Kwasi Kwarteng, under short-lived premier Liz Truss, that sparked markets chaos and worsened a cost-of-living crisis of high energy bills and inflation.

Hunt also suggested on Wednesday that support for householders would not be extended beyond early 2024, even if energy bills remain elevated.

M.Odermatt--BTB