Keir Starmer: Labour considering keeping UK in reformed single market
Labour believes single market & free movement reform is possible but fall short of making it policy.
Could Labour be firming up its long-term vision for Brexit? As the BBC reports, the party sidestepped formally clarifying its Brexit policy by not including a vote on it at its annual conference. As with the Tory party, Labour has done a good job of being vague about what it wants regarding Brexit in the long-term (at least beyond a transition period). Officially, its position is for a “jobs-first Brexit”. It wants the UK to “retain the benefits of the single market and the customs union” and how that is achieved should be “secondary to the outcome”. In a speech this morning, the shadow Brexit secretary Keir Starmer sought to shed more light on the options Labour is considering to achieve that.
Starmer reiterated that options should not be “swept off the table” to achieve keeping the benefits of the single market and customs union. On the latter, he said “remaining in a form of customs union with the EU is a possible end destination for Labour.”
As for the single market, he said: “We are also flexible as to whether the benefits of the single market are best retained by negotiating a new single market relationship or by working up from a bespoke trade deal.” Of course, what he doesn’t highlight here is the inevitable trade-offs that will need to be made. The main one being accepting free movement.
We would negotiate a final deal that ensured continued co-operation and collaboration with our EU partners in all fields. And a final deal, that retained the benefits of the Customs Union and the Single Market. Options for achieving this should not be swept off the table.
Subject, of course to negotiations, remaining in a form of customs union with the EU is a possible end destination for Labour.
We are also flexible as to whether the benefits of the Single Market are best retained by negotiating a new Single Market relationship or by working up from a bespoke trade deal.
Keir Starmer, Labour shadow Brexit secretary
Speaking to ITV’s Peston on Sunday, the shadow chancellor John McDonnell also suggested Labour could support membership of a reformed single market. He said this would go hand-in-hand with reforming free movement.
We believe we can reform freedom of movement of people on the basis of protecting wages. That would be a changed single market.
John McDonnell, Labour’s shadow chancellor
McDonnell’s comments suggest a popular myth that immigration has had a negative impact on wages. As we previously reported, evidence shows immigration has only had an “infinitesimally small” impact on wages and that cuts to migration would likely damage the economy. This was echoed by Bank of England governor Mark Carney. In a speech last week, Carney said: “Higher levels of migration in the UK have not, however, been associated with significant reductions in overall wage growth and therefore inflation.”
In any case, if Labour is seeking single market and free movement reform, it should also consider the best way to do that is to be in the EU.
Labour’s position on continued customs union membership is likely to be less problematic for the party. There doesn’t seem to be the same level of support within Labour for being able to agree its own trade deals as there is within the Tory party. Continued customs union membership would also solve the problem of the Irish border. And as the Financial Times reports, there is a Treasury study which shows the value of new free trade deals would not counter the costs of leaving the customs union. It’s one of several impact assessments on Brexit the government has conducted but are so far refusing to publish. There is currently a petition being shared calling for the government to publish these. You can sign it at petition.parliament.uk.
Labour has been clearer about its position on the immediate period after the UK’s expected departure from the EU in March 2019. The party supports staying in both the single market and customs union for a transition period of at least two years. And Labour accepts this would mean continuing to follow EU rules including free movement during that period. At her speech in Florence on Friday, the prime minister suggested the government was also moving towards this position.
However, there is still some way to go before we get a clear Brexit policy from Labour. It’s possible it could eventually include support for a new referendum on the Brexit deal. A new poll reported by Politico found nearly three quarters of Labour supporters backed another EU referendum. Now that Brexit talks are underway and with the clock ticking, focus on what trade-offs need to be made is growing bigger. Perhaps going back to the people is the only way to resolve the problem both the government and Labour have over what trade-offs should be made.
You can see Starmer’s full speech at labourlist.org. Alternatively, here’s a video of Starmer delivering his speech: