Leaving the EU but joining a customs union is like throwing away the burger and eating the napkin, said the Conservative peer Lord Hannan. He’s right.
Recent weeks have seen a bizarre push by some Labour and Lib Dem politicians – including in major newspaper interviews – to rejoin the EU’s customs union.
Most of these MPs were not present during the political chaos of 2017–2019 that followed the Brexit referendum, during which many in Westminster fought to overturn the vote. And those Labour MPs who were there, and who now want to rejoin the customs union, clearly learned nothing. The only people advocating for such a policy – and here I include the trade union bosses who have also proposed it – do not understand what a customs union actually is.
As a former Trade Secretary, I know that trade is about hard choices. You defend British interests. You say no to deals that are easy to sign but bad for the country. Yet Labour, despite all the dramatic changes to the global trade system this year, have still not grasped one simple lesson. Trade policy is power: lose control of it, and you lose the ability to govern yourself.
This is why the renewed chatter about dragging Britain back into the EU’s customs union should worry us all. It is not a sign of pragmatism – it is a symptom of Labour’s weakness.
It’s now painfully obvious to everyone that Keir Starmer entered government without a plan. The list of humiliating U-turns is so long that, I hear, Labour MPs now think twice before supporting a policy announcement in case the PM scraps it a week later.
From winter fuel payments to freezing income tax thresholds and the Family Farm Tax, Labour haven’t just broken their pre-election promises, they’ve inflicted untold damage to the British economy while doing so.
And now the government is weak and has no plan or new ideas, it has re-opened old Brexit wounds in the vain hope that doing so will make it more popular.
It won’t. Going back into the customs union would make us all poorer and damage British business and British farming. Four major benefits of Brexit would be lost: we would no longer be able to set our own tariffs, negotiate our own trade deals, maintain the deals we’ve signed as an independent nation, or reject deals struck by others, even when they harmed our interests.
Worse, the bloc would demand even more concessions from us to rejoin – and this hapless Labour government would no doubt surrender. Keir Starmer’s previous attempts at ‘negotiating’ with the EU have been one humiliation after another.
The PM gave up our fishing rights to get into an EU ‘defence fund’ that we still don’t have access to, and then paid almost £600million to rejoin an Erasmus scheme we’d decided was too expensive at £100million and was mostly being used by EU students studying here, not young Brits going abroad.
Starmer’s trade agreement with President Trump, though considerably worse than the deal the Conservatives had ready to go with America, is nevertheless clearly better than anything the EU has managed to agree with the world’s most important economy.
Why would we give up the trade deals we’ve negotiated, all structured to work for British businesses, to join a customs union designed to benefit firms in EU countries, with vastly different priorities? Britain is in a slump. Talk of a customs union is a distraction. I’m not here to make excuses for previous Conservative governments: we got things wrong, or we’d still be in government.
However, we did leave Labour the fastest-growing economy in the G7, record levels of employment and inflation on target at 2 per cent.
We also had a clear trade policy: as Trade Secretary, I signed our biggest post-Brexit deal in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), securing preferential access to a vast market of 500 million people in the Indo-Pacific region – which will account for half of global economic growth in the next decade – while defending our farmers and making no migration concessions.
