THERESA May’s plan for the UK to have temporary membership of the European customs union post Brexit has been branded “daft” by Nicola Sturgeon and “a fantasy” by Guy Verhofstadt, the European Parliament’s chief negotiator.

David Davis, the Brexit Secretary, toured the television and radio studios today, promoting the Prime Minister’s proposal for the UK to have an interim agreement on membership of the customs union for up to three years while having the ability to negotiate its own trade deals with other countries; something impossible for members of the customs union, who operate as a bloc.

Mr Davis hinted that Britain might be willing to pay a fee to Brussels for the privilege of seeking to negotiate its own trade deals with other countries like the USA, China and Australia while effectively being a member of the customs union; something critics labelled as “having your cake and eating it”.

Asked whether Britain would have to pay to stay in the customs union, he said: "Well, what happens in that sort of interim period you will have to leave me to negotiate, I'm afraid; how we do it. But the aim is to bring to an end these huge £10 billion-a-year payments, bring that to an end now.

"We are still haggling with them over what we may owe them in the short term but we are going to bring the overall thing to an end. This is something that is in both sides' interest."

The Secretary of State stressed that it was in the EU’s own economic interests to do a deal. He told ITV's Good Morning Britain: "We sell them, the Europeans, about 230bn euro of goods and services a year. They sell us 290bn euro. So there are a lot of things there."

The proposals for new customs arrangements to allow trade with the EU are being outlined in the first of a series of "future partnership papers" being released by the UK Government.

One option being put forward was an "innovative and untested approach" to customs in which a new customs partnership would negate the need for a customs border between the UK and the EU, meaning there would be no customs checks because the UK's regime would "align precisely" with the EU's for goods consumed in the EU.

However, the UK would continue to operate its own checks on goods coming from outside the EU and safeguards would be needed to prevent goods entering the EU, which had not complied with its rules.

Another proposal would involve a more efficient system of “highly streamlined” border checks to minimise disruption at ports and airports.

This could involve using number plate recognition technology at ports, which could be linked to customs declarations for what the vehicles were carrying, meaning they would not have to be manually stopped and checked.

Under this option, the UK would also allow some traders to do self-assessment, calculating their own customs duties but this would lead to an increase in administration compared to the existing customs union.

Mr Davis insisted the negotiations were going "fine" and EU leaders were less hostile than they had been previously.

"The simple truth is we want to come out of this better but they want to come out of it better too. There was a terror early on that we would be the first of many countries breaking off.

"After the victory of[President]Macron in France, that terror is reduced. They are no longer quite so afraid so the punishment battalion side is now reducing," he added.

But the First Minister decried Mrs May’s plan for temporary membership of the customs union, tweeting: “Seems UK gov is back to its daft 'have cake and eat it' approach to Brexit. They should commit to staying in single market and CU, period."

Her colleague, Stephen Gethins, the SNP's Europe spokesman at Westminster, echoed the point, saying: “What we're seeing...is just how important the single market and customs union are to jobs and to the economy, to everybody in Scotland and across the UK as well.”

Labour’s Sir Keir Starmer, the Shadow Brexit Secretary, said the Conservative Government's proposals were "incoherent and inadequate" and were designed to "gloss over deep and continuing divisions within the Cabinet".

In Brussels, Mr Verhofstadt, wrote on Twitter: "To be in and out of the customs union and 'invisible borders' is a fantasy. First need to secure citizens rights and a financial settlement."

Karel de Gucht, the former EU trade commissioner, suggested Brussels could block the PM’s plan for interim customs arrangements, saying “politically it’s very difficult” because Britain would in effect be “undercutting” the EU.

“It would be trying to get preferential tariffs with other nations, different from the common EU tariff in the transitional period,” he said.

But Tory backbencher Nigel Evans, the former Deputy Speaker, insisted that the UK’s ability to be able to negotiate its own trade deals during a transitional deal was “vitally important, so full negotiations can take place rather than the scoping-out going on at the moment”.

He added: "The end date must also be known as to when we leave that temporary customs union and where those new trade deals come into effect."

However, Nigel Farage, the former Ukip leader, accused the UK Government of showing "weakness" before the Commission by making clear that it was willing to delay "for many, many years".

He accused Whitehall of pursuing a policy of “dither and delay”. He said the process of partnership papers was not really about Brexit but the Conservative Party’s attempt to find a compromise between Leavers and Remainers.

The MEP claimed the Government’s interim plans signalled Britain would not be open for business for a long time and suggested a much more “hard-nosed approach,” that the whole process should be sorted out by March 2019.

Meantime, a spokesman for the European Commission said the organisation would study the UK position paper on customs carefully in the light of the European Council guidelines and its negotiating directives.

"We take note of the UK's request for an implementing period and its preferences as regards the future relationship but we will only address them once we have made sufficient progress on the terms of the orderly withdrawal.

"An agreement on a future relationship between the EU and the UK can only be finalised once the UK has become a third country.

"As Michel Barnier has said on several occasions 'frictionless trade' is not possible outside the single market and customs union."

The EU is also working on a position paper on the customs union, following a tranche of documents published before the summer on issues such as citizens' rights and nuclear materials, he said.

The next negotiation round will start in two weeks’ time.