Corbyn’s Customs Union

Labour’s leader, Jeremy Corbyn MP, has confirmed that his party will now back remaining in the Customs Union. What Labour is now proposing is unlikely to be accepted by the EU, but is an astute piece of political positioning.

Corbyn said a Labour government would seek and ‘negotiate a new comprehensive UK-EU customs union to ensure that there are no tariffs with Europe.’ A Labour government, he explained, would want to have a say on future EU trade deals while ending freedom of movement. Labour would also seek to negotiate ‘protections, clarifications or exemptions where necessary in relation to privatisation and public service competition directives, state aid and procurement rules, and the posted workers directive.’[1]

It seems unlikely that the EU would accept this in exchange for a close relationship. The EU has consistently opposed ‘cherry-picking,’ which would allow the UK to maintain tariff-free access to the EU without upholding key parts of EU law. Labour are aiming for exemptions on state aid, aspects of TTIP and freedom of movement, while also maintaining a close relationship through the customs union. Judging by the EU’s statements on cherry-picking to date, it seems unlikely that a Labour government would achieve these objectives.

Politically, Labour’s suggestion of a customs union is clever positioning. The speech contained assurances which cater to Labour leavers, such as pledging to end freedom of movement. At the same time, Labour remainers will be encouraged that their leader has explicitly backed remaining in a customs union.

Perhaps more significantly, Labour can now back amendments to the Trade Bill and Taxation (Cross-Border Trade) Bill, which would commit the Government to staying in the customs union. Julian Smith MP, the Chief Whip, has reportedly told the Prime Minister that there is a ‘very real threat’ that Labour could unite with 15-20 Tory rebels and defeat the Government.[2] The change in policy increases the chances of a significant Government defeat over a central plank of its Brexit plan.

Labour does not need to worry about whether its plan is acceptable to the EU. In opposition it is more or less insulated from the realities of the negotiation table. Labour’s new position on the customs union is significant however. It increases the chances of a major Government defeat, while keeping both the pro and anti-EU elements of the party largely onside.



Brevia Bulletin: 12 August 2022

Brevia Consulting is providing a weekly round-up and analysis of the UK headlines. This week, read about Cornwall Insight’s latest predictions on the retail energy price cap, the Scottish Government’s legal case to hold another independence referendum on 19 October 2023, and former Prime Minister Gordon Brown’s recent comments on the energy crisis.

Read More »

Brevia Bulletin: 5 August 2022

Brevia Consulting is providing a weekly round-up and analysis of the UK headlines. This week, read about Liz Truss and Rishi Sunak facing criticism for their latest policy proposals, and the Bank of England’s decision to raise interest rates to 1.75 per cent.

Read More »
Brexit Update

Brevia Bulletin: 29 July 2022

Brevia Consulting is providing a weekly round-up and analysis of the UK headlines. This week, read about the infringement procedures launched by the EU against the UK, the latest developments in the Conservative Party leadership contest, and the BEIS Committee report published this week on Energy Pricing and the Future of the Energy Market.

Read More »
  • Get in touch to arrange your free monitoring trial.