It was Europe, in many ways, that made Keir Starmer. The Prime Minister was a pro-European of the Delors age, embracing the project as a vehicle to advance human and social rights. Then, as shadow Brexit secretary, he established himself as a leader-in-waiting, drawing a standing ovation at the 2018 Labour conference when he declared “nobody is ruling out Remain as an option” (an intervention that enraged Jeremy Corbyn’s aides). Two years later, as a demonstration that his party had changed, Starmer whipped his MPs to vote for Boris Johnson’s deal.
Little was heard about the costs of Brexit after that. The only reference to the subject in Starmer’s 2024 conference speech came in a passage lamenting the Conservatives’ failures on immigration.
But recently, as on much else, the Prime Minister has begun to sound more like his old self. “Wild promises were made to the British people and not fulfilled,” he warned of Brexit in his speech at the Lord Mayor’s Banquet last night. “We are still dealing with the consequences”. Earlier that day, in another address on the economy, Starmer argued: “We have to keep moving towards a closer relationship with the EU, and we have to be grown up about that, to accept that will require trade-offs”.
Starmer’s new tone reflects a sea change in public opinion. A YouGov poll earlier this year found that 56 per cent believe the UK was wrong to leave the EU compared to just 32 per cent who believe it was right. There’s a difference between “Bregret” and “Brejoin” but the same number (56 per cent) also favour rejoining the EU.
Economics, too, has driven the government’s recalibration. Rachel Reeves, once one of the cabinet’s more Eurosceptic members, now champions measures such as a youth mobility scheme as part of a desperate search for growth.
No 10 emphasises that Starmer’s red lines – ruling out a return to the customs union or the single market – remain “unchanged”. But an increasing number believe that he should be prepared to think the unthinkable. Minouche Shafik, the Prime Minister’s recently-appointed chief economic adviser, is among those to have pushed for a new customs union with the EU.
“If you wanted to find a measure that would make the biggest difference to GDP that would be the one to break glass on,” a government source told me, noting that new trade deals with the US and India were far less valuable (a recent House of Commons analysis, commissioned by the Liberal Democrats, found that a customs union would boost UK GDP by 2.2 per cent).
“If growth is still the number one mission, we’ve got to be bold,” a second government source argued. “Median incomes are the best predictor of elections and at the moment people are going to be worse off at the end of the parliament. Brexit voters will forgive a customs union if the economy turns around”.
In Labour circles a customs union is regarded as more viable than single market membership because it would not entail a return to free movement and would still allow the UK to diverge from Europe in areas such as artificial intelligence. It would also help counter the electoral threat from the Lib Dems – who intend to trigger a parliamentary vote on the issue this month – and the Greens who between them have won almost a third of Labour’s 2024 support. While Reform and the Conservatives would cry “betrayal”, the same is being said of the government’s EU “reset” though for far more limited economic gain (a projected boost to GDP of 0.3 per cent by 2040).
But will Starmer dare be so bold? Backing a customs union would represent an explicit manifesto breach of the kind the Prime Minister has just rejected over tax, and would also risk damaging relations with Donald Trump – always a matter of high priority in No 10. Yet the longer Starmer’s woes persist, the more voices will urge him, as in 2018, to tear up the script.
This piece first appeared in the Morning Call newsletter; receive it every morning by subscribing on Substack here
[Further reading: Starmer stumbles over Reeves rumble]
Content from our partners
Related
