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Rees-Mogg was referring to an alleged conversation between Baker and Charles Grant, the director of the Centre for European Research and an expert on EU negotiations, at a lunch at the Tory party conference. However, several individuals present at the event challenged the claim, including Grant himself and a Tory MP, Antoinette Sandbach. Prospect magazine later issued an audio of the conversation in which there is no suggestion about officials trying to rig the analysis. After the audio emerged, Baker said his answer was based on an “honest recollection of the conversation” but he now stood corrected. He added that he would apologise to Grant and clarify his comments in parliament.

Jacob Rees-Mogg, a leading anti-EU Conservative MP, had asked Mr Baker in the Commons to confirm whether he had been informed by a think-tank that the Treasury had “deliberately developed a model to show that all options other than [the UK] staying in the [EU] customs union were bad and that officials intended to use this to influence policy”. ...Mr Rees-Mogg suggested Mr Baker had been given this information by Charles Grant, the head of the Centre for European Reform, a think-tank. Mr Grant responded later by saying he recalled discussing Treasury research into Brexit with Mr Baker last October. But Mr Grant added: “I did not say or imply that the Treasury had deliberately developed a model to show that all non-customs union options were bad, with the intention to influence policy.

Baker, who was a key figure in the Leave campaign, told the House of Commons on Thursday that he had been told by Charles Grant, director of the Centre for European Reform, that Treasury officials had sought to distort economic modeling on Brexit to force a change in government policy. He was responding to a question from Jacob Rees-Mogg, a devoted Brexit backer who is a potential leadership rival to Theresa May.

John Springford and Sam Lowe, of the Centre for European Reform, have proposed that by emulating the Island’s trade relationship with the EU, the UK government could resolve the Irish border issue and secure enough bargaining power to apply tighter immigration controls, which are two key Brexit issues.

This Centre for European Reform briefing explains this issue in more detail. Here is an excerpt from the report, written by Sam Lowe."As well as binding the UK to the EU’s single market and customs union, the draft proposal seeks to ensure that the UK continues to apply the bloc’s external tariff rates and performs the same border checks with non-EU countries. This could easily result in a scenario in which UK exporters are no longer able to take advantage of the EU’s existing free trade agreements, but exporters located in countries with EU FTAs [free trade agreements] would continue to benefit from preferential access to the UK market on the same terms as now.

According to the influential Centre for European Reform think-tank it is France, Germany and the EU Commission that are opposed to a good deal. ...CER Director Charles Grant said UK officials have noted that “several member-states are uncomfortable with the hard line taken by France, Germany and the Commission”. Meanwhile, bureaucrats in Berlin and Paris fear that they are becoming increasingly isolated due to their tough approach, meaning it will be “harder for France and Germany to get their way” in the second phase.

According to Sam Lowe of the Centre for European Reform, one of the goals of EU negotiators is to push May to explain the reality of Brexit to voters. “The second phase of the withdrawal negotiations, for the EU, is about forcing the UK to acknowledge the inherent trade-offs that come with Brexit,” says Lowe. “There is a hope that when and if they do come clean, then there will be a moment where the country goes, ‘Ah. Do we actually want to do this?’ ”