My article for the New Statesman on why the Labour Party should embrace a soft-Brexit policy. You can also read the full article on the New Statesman website.
Jeremy Corbyn was yesterday faced with the media’s current favourite “gotcha” question: how would he vote this time around if the EU referendum were held again? He said that he would vote Remain -; an encouraging remark, but one that is not clearly inspiring Labour’s Brexit policy. I, too, would vote Remain.
However, given there’s currently little prospect of a second referendum, the much more important question is: what should Labour’s position on Brexit be going forward?
Just like the vast majority of Labour members, I was encouraged to see our shadow Brexit secretary, Keir Starmer, announce in August that Labour’s policy would be to keep the UK in both the single market and the customs union for a transitional period after Brexit. However, for the good of our country, we must go further. The best way to secure the economic future of Britain is for Labour to announce its intention to keep the UK in both the single market and the customs union permanently. It makes no sense to take this off the negotiating table if your policy is to “maintain the same benefits”.
I know some of my fellow Labour supporters have concerns about whether some of our manifesto pledges, that were so crucial to our success in the snap general election, would be achievable within the single market. For example, rail renationalisation or abolishing university tuition fees. But single market rules do not preclude such policies. Both Italy and Germany have railway companies owned by the state, whilst many EU countries offer free university tuition. There is significant flexibility offered to members – it is just we have never used that flexibility effectively.
On the contrary, leaving the single market and the customs union would make it much more difficult for Labour to fulfil its manifesto, as there would be less money available for a Labour government to invest. Studies suggest the cost of leaving the customs union could be £25bn per year, whilst leaving the single market would endanger trade with our single biggest trading partner: the EU. That means a weaker economy, a lower tax take for the government, and less money to spend on investing in our NHS or education system.
Indeed, Brexit uncertainty has already cost the Treasury £900m in lower stamp duty revenues, as the Office for Budget Responsibility admitted earlier this week. That is money that now cannot be spent on our creaking public services.
The government’s decision to wrench the UK out of both the single market and the customs union is not one that was required by the referendum result. The EU was on the ballot paper; its economic institutions were not. In fact, Theresa May’s loss of her majority at the general election can be seen as a rejection of this government’s ideologically-driven trajectory towards a hard, destructive Brexit.
As each day passes, it becomes clearer and clearer that the government’s approach towards Brexit is being dictated by the most extreme elements of the Conservative party. They want to exploit this opportunity to turn the UK into a low-tax, low-regulation bargain-basement economy, a place where concepts like workers’ and consumer rights, food safety standards and environmental rules are just anachronisms to be sacrificed atop a Brexit bonfire. The PM’s angry reaction to this accusation from my Labour colleague, Heidi Alexander MP, at this week’s PMQs shows it to be true.
Labour now has the chance to seize the mantle of the grown-up party of government-in-waiting. Our policies on Brexit are already both more sensible and more humane than the Tories. We have already pledged to end the threat of a disastrous no-deal Brexit, to immediately guarantee the rights and residence status of 3 million EU citizens living in this country and to keep the UK in the single market and the customs union for a transitional period.
But now is the time to go one step further. We should establish a clear policy of permanently staying in both the single market and the customs union, avoiding economic catastrophe, job losses, and pain in our public services. If we want to deliver a credible “jobs first” Brexit then there is only one way to deliver that. Not only is this policy the best fit for the Labour Party’s core principles, it’s also the best policy for the future of our country.