Davis admits UK Government would consider paying to access single market post Brexit

Mr Davis told Labour’s Wayne David: "The simple answer we have given to this before is, and it's very important because there is a distinction between picking off an individual policy and setting out a major criteria, and the major criteria here is that we get the best possible access for goods and services to the European market.

"If that is included in what you are talking about then of course we would consider it."

Downing Street did not resile from the Brexit Secretary’s suggestion with Theresa May’s spokeswoman, saying: “What he said in the House this morning is consistent with what we have said to date, which is: it will be for the UK Government to make decisions on how taxpayers' money will be spent.”

She went on: "We've said, as we approach these negotiations, we want to get the best possible access for British businesses to trade with and operate within the single market, while also taking back control on immigration."

Mr Davis's response to the question of payments to the single market was merely setting out what the Government's approach would be, explained the spokeswoman, if people were to suggest this during the talks. She added: "All these issues will be a matter for the negotiation."

But markets reacted positively to Mr Davis’s remarks with the pound making a surge, rising one per cent against the US dollar to 1.26, its highest level in three weeks. Sterling also rose against the euro by 0.63 per cent to 1.18 euro, aided by the eurozone currency's struggles in the face of the Italian constitutional referendum on Sunday.

As Philip Hammond, the Chancellor, is due to meet Nicola Sturgeon, the First Minister, during a visit to the Scottish Parliament this afternoon, during Brexit Questions in the Commons, David Jones, the Brexit minister, was asked by the SNP’s Roger Mullin if he could “outline the benefits of Scotland securing full membership of the single market post-Brexit?"

At this point a Tory MP could be heard saying: "It'll be a short answer."

Mr Jones replied: "I have to say I find it extremely difficult to see how one part of the United Kingdom could remain part of the single market while the rest was not.

"I would refer you to what the First Minister of Wales[Carwyn Jones] said only the other day, when he said he couldn't see how there could be separate market arrangements between different nations in the UK that share the same land mass."

Ms Sturgeon has revealed the Scottish Government is considering Scotland retaining membership of the European Free Trade Association and European Economic Area.

But such a move would be unique given Scotland is not a member state and in normal circumstances would need the unanimous support of all member states, including the UK.

Manuel Rajoy, Spain’s Prime Minister, has already said he would not agree to any special deal sought by the Scottish Government. Earlier this week, Esteban Gonzalez Pons, who leads the Spanish delegation of MEPs in the European Parliament’s largest political grouping, also made clear his country would oppose any move by Ms Sturgeon to keep Scotland in the single market if the UK left it. Any proposal for a special Scottish deal was “impossible,” he said.

The FM is due to publish her government’s options for Scotland retaining its status in the EU before Christmas.

Also later this month, another meeting between the UK Government and the devolved administrations at the Joint Ministerial Committee will take place to discuss Brexit. A final plenary session of the JMC, involving the PM and FM, is set to take place in late January.

Later during Commons questions, Labour’s Hilary Benn, who chairs the Brexit Committee, highlighted the growing frustration among MPs at the lack of any clear strategy from the Government on Britain leaving the Brussels bloc.

"In a week in which it has been reported that the Foreign Secretary has told EU ambassadors that he doesn't agree with the Government's policy on freedom of movement and that a Dutch member of parliament attended a briefing in Downing Street on the Government's plans for Brexit, does the Secretary of State understand why the House is getting a little fed up with being told nothing?

"If he does, can he tell us when the Government will come forward with its plans for Brexit including on what will happen as regards any future contributions to the European Union after we have left?"

Mr Davis said he is due to appear before the Brexit committee in December and that members of the committee had visited the Department for Exiting the EU.

He said: "But you also know full well as a previous international development secretary, as a previous cabinet minister, that the approach to this, the probable success of the negotiations depend very greatly on us being able to manage the information and keep what needs to be secret until the last minute secret.

"In terms of the other things you talked about this week, frankly, this is all based on a presumption that a scribbled note in Downing Street actually is anything like Government policy. It wasn't."

Elsewhere, claims that Boris Johnson had privately told EU diplomats that he backed freedom of movement was branded a "total lie" by sources close to the Foreign Secretary.

Four ambassadors reportedly claimed the Cabinet minister had told them he supported unrestricted migration across the bloc.

Former party leaders Ed Miliband and Nick Clegg seized on the reports and attacked the Secretary of State for treating voters like "fools" and criticised his "buffoonery".

But sources close to Mr Johnson dismissed the claims as a "total lie" and insisted he had "never said anything of the sort".