Open Europe finds that an outsider arrangement like the one negotiated by Norway would still cost Britain over £31bn a year, but with no vote on EU rules

Britain would still face EU regulations costing £31.4bn a year – around 94% of the current costs – if it left the EU and opted for a relationship with Brussels along the lines of the one negotiated by Norway, a leading pro-reform thinktank will argue.

Open Europe, which campaigns for major reforms in Britain’s relationship with the EU, says that the UK would still have to uphold the “most burdensome EU rules” if it was to adopt what is known as the Norway option.

Under this scenario, dubbed in the past by Open Europe as the “nearly but not quite an EU member” model, Britain would have access to the EU single market as a member of the European Economic Area. But it would have no vote over EU rules.

The findings come in a report in which Open Europe says that the only way Britain could free itself from the £33.3bn costs of EU regulations is through radical reforms within the EU or a “far better trading model” as an outsider than the arrangement negotiated by Norway.

The thinktank says that official impact assessments estimate that the 100 most costly EU regulations, which cost £33.3bn a year, provide benefits of £58.6bn a year. But Open Europe says that 95% of the benefits highlighted in the impact assessments have never materialised. Costly regulations include the working time directive (£4.2bn a year) and the UK renewable energy strategy (£4.7bn a year).

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Pawel Swidlicki, research analyst at Open Europe, said: “The bad news is that overall, EU regulation costs too much in relation to the benefits it generates. The even worse news is that if the UK left the EU and became like Norway, 94% of the cost associated with the most burdensome EU rules would remain in place but the cost would be even harder to cut, since Norway has no formal voting powers over EU rules. Radical reform from within the EU or a far better trading model outside of it remain the UK’s best options for cutting regulatory costs.”

Pro-Europeans will argue that the report shows that opponents of EU membership have yet to outline a credible alternative. David Cameron said recently that the anti-EU camp has issued contradictory statements about the alternatives to EU membership.

Writing in the Guardian earlier this month, Gordon Brown argued that new arrangements outside the EU, along the lines of those negotiated by Norway and Switzerland, would not work. The former prime minister wrote: “The ‘Britzerland’ or Norwegian alternatives (even Norwegians oppose the Norwegian option) leave us subject to EU rules, but denied a vote in shaping them.”

Opponents of Britain’s EU membership are likely to read Open Europe’s report as suggesting that one of the best ways to free Britain from costly EU regulations would be to negotiate a better trading model outside the EU.

But in a report in 2012 Open Europe said there were problems with all four models outside the EU. In addition to the Norway option, the other alternatives identified were:

• The Swiss option, in which the UK would negotiate a free trade deal with the EU. But this would probably exclude Britain’s financial services from the EU’s single market.

• A “stripped-back customs union with the EU”, known as the Turkish option. Britain would have access to the single market but would face a dependent relationship with the EU because it would be bound by the EU’s external trade deals.

• A “clean break” which would see Britain leave the EU and negotiate trade deals through its membership of the World Trade Organisation. Open Europe said of this option: “There would be a major price to pay for this. In the absence of preferential trade agreements with either the EU or other countries, exporters in the UK would suddenly be faced with new tariffs.”