Labour’s policy towards the EU has been a source of tensions. On Monday, the party had to deny that it would re-enter the customs union after winning the general elections.
In a paper published by the Eurasia group political consultancy, unidentified “senior Labour Insiders” claimed that the party was planning to revive High-Alignment Deal originally negotiated by the former Prime Minister Theresa May and rejected by Parliament in 2019 in order to boost economic growth.
“[That] is an ambition for the first term. It’s a de facto union of customs by another name. One of the insiders said that it was the first step to where we would like to be. They added that they were reflecting a new internal thinking about the EU relationship in the labour leadership.
The report said that, if the opposition party wins the October elections with a majority as indicated by current polls, Labour leader Sir Keir starmer will travel to Brussels in December to express his desire for an “upgrade” to the EU-UK relationship.
Labour denied the briefing sent on Monday to clients of Eurasia Group, insisting that the party would stick to its “redlines” regarding the EU. These include staying outside the single market as well as a customs Union.
Nick Thomas-Symonds said that the Labour Party’s position has not changed. He is the shadow Cabinet Office Minister who will be in charge of the promised reengagement with Europe, if Labour wins the next elections.
Labour has made it clear for a long time that we are committed in making Leave work. He added that we have clearly defined red lines for the future of our relationship. “We will not return to the Single Market, to the Customs Union or to freedom of Movement,” he said.
To create a customs Union with the EU, the UK would have to unravel other aspects of its trade policy. This includes the agreements signed with Australia and with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPATP), which is made up of 11 members.
Labour has pledged to improve the EU and UK trading relationship. However, it is only going to do so within certain “red lines”. It will also seek to reach a veterinary accord to reduce frictions at border crossings for food, to increase touring opportunities for musicians, and to boost reciprocal access to professionals.
Internal critics warn that these actions are not enough to achieve the other pillars of the policy platform of the party, such as an industrial strategy or being the fastest growing economy in the G7.
According to May’s rejected agreement, the UK remains in a de-facto customs union and is committed to high regulatory alignments including in environmental and labour standards – a position Eurosceptics reject as being too close to the EU.
Mujtaba Raham, the managing director of Eurasia Group for Europe, who wrote the client note, stated that any attempt to deepen structural economic ties will require Labour to be more proactive than it is currently.
He added that they would have to move quickly and clearly with Europe following the election. They would also need to convince the UK electorate of the benefits this arrangement would bring to UK trade, investment, and Labour’s agenda for growth.
A person who has been briefed by the European Commission on its approach to the UK said that Brussels could be open to a similar proposal. The Commission is also monitoring the possibilities under a Starmer-led government.
They added that “it would be a massive negotiations, but the EU would be openness.” “There has been a great deal of thought put into the possible outcomes.” . . But there will be obvious strings attached.
Other Brussels-based officials were also open to a possible deal, but they were sceptical about Starmer’s willingness to make necessary concessions.
One EU official said that a customs union could be possible if certain conditions are met, but warned against any special treatment for Britain.
A second official said that London would be “bound by the European Court of Justice” and give up its sovereignty. Every time we signed a new agreement, it would apply automatically to the UK.
The 27 members are in general for closer ties to the UK, but they remain cautious about reopening agreements made after years of bitter negotiations. Another diplomat said, “We’ve moved on.”