Sir Keir Starmer should look at taking the UK back into a customs union with the EU to benefit British workers, the general secretary of the TUC has said.
Paul Nowak said a customs union should be among the Government’s options to make trade with Europe as “frictionless as possible”.
Lord Helseltine, a former Conservative deputy prime minister, also urged Starmer to negotiate a customs union – which removes some trade barriers – to reverse the “significant loss of market share” British firms have suffered in Europe since Brexit.
Earlier this month, Health Secretary Wes Streeting reopened divisions over Europe within Labour when he appeared to float the idea of rejoining the customs union, in an interview with The Observer. The intervention was a departure from the policy laid down by Starmer, who has said it is a “red line” that the Government will not cross.
Now, Nowak – one of the most prominent figures in the labour movement – has joined Streeting in urging the Prime Minister to look at the idea.
Asked whether Starmer should consider taking the UK back into the customs union, he told The i Paper: “The TUC said back in May, when we had that summit and the agreement with the European Union, the Government should have an open mind and be prepared to look at everything up to and including a customs union.
“And for me, this isn’t about politics, and it’s not about rerunning the referendum. It’s about saying this is our most important trading partner.
“We’ve got companies that have supply chains that stretch into Europe and goods going backwards and forwards. We need to make that as frictionless as possible – and a customs union might be the option. It might be another set of arrangements, but the guiding principle should be a close, positive working relationship with Europe.
“That’s good for workers on this side of the Channel and on the other side of the Channel as well.”
‘Rejoin Europe to get growth’
Heseltine said rejoining the customs union was the right move. The Conservative grandee told The i Paper: “Brexit is a disaster and the quicker we recognise that the better.
“Every step which is taken politically in that direction, of rejoining, is to be welcomed.”
Some people have suggested that Streeting endorsed a customs union because he harbours leadership ambitions, with many Labour members favouring closer relations with the EU. The Health Secretary has denied being on leadership manoeuvres.
Heseltine said he thought Streeting’s intervention was “more about the internal politics of the Labour Party than any reality”. But he added: “Of course, there is no doubt that British industry is suffering significant loss of market share and if you want a growth agenda you’ve got to rejoin Europe, and the quicker the better.”
Asked whether he thought the Government would eventually end up embracing a customs union, Heseltine said: “Well, I’m not competent to speak to the internal politics of the Labour Party, but on the other hand, who the hell is?”
However, he said that the direction of travel was for closer ties with Europe, with the Tories at risk of being left behind: “There is a serious lesson for the Conservative Party, they need to recognise the way the wind is blowing… the wind is blowing towards our relationship with Europe.”
Reform pact could do ‘serious damage’ to Tories
He also warned the Tories against doing a deal with Nigel Farage’s Reform UK. “Having any relationship with Reform would do serious damage to the Conservative Party,” he said.
Some Labour MPs think it would be a mistake to form a customs union with the EU, because it would mean the UK losing its post-Brexit freedom to strike its own trade deals.
If the UK joined a customs union, the Government would be likely to have to scrap existing trade deals negotiated with countries such as the US and India.
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There would also be no certainty that the UK would benefit from free trade agreements negotiated by the EU.
No 10 has said that the Government’s policy is to “strengthen” the UK’s relationship with the EU, but has confirmed that it has no plans to rejoin the customs union.
In a speech earlier this month, Starmer said Britain had “redefined our bond with the EU, building a new partnership that benefits both sides, sticking to our red lines while supporting British businesses, making food cheaper, and slashing red tape”.
Downing Street declined to comment.
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