Tide may be turning on Brexit, it’s not too late for Labour to lead
Regret over Brexit now spans the political and economic spectrum. Starmer says 'not in my lifetime' over re-joining the EU but the economic fallout is clear.
When the UK left the EU in 2020, many foresaw the damage it would inflict. In the nearly five years since, the scale of the fallout has become painfully clear. By almost every economic and financial metric, Brexit has been disastrous for the UK. The pound plummeted almost immediately, and the UK, once a leader in GDP growth, employment, and financial markets among the EU's 27 nations, has seen its economic standing diminish.
Regret over Brexit now spans the political and economic spectrum. Former Bank of England Governor Mark Carney has urged ministers to “rebuild relations” with Europe, highlighting how Brexit has “weighed” on the economy, disrupted trade, and undermined industry. Mayor of London, Sadiq Khan pointed out that London alone is estimated to have lost £30 billion in economic output and nearly 300,000 jobs.
Independent analysis estimates the total cost of Brexit to the UK economy at nearly £140 billion, with the average Briton nearly £2,000 poorer in 2023 than they would have been otherwise.Yet, Brexit remains the elephant in the room. Despite the last general election focusing heavily on economic growth, parties veered away from addressing the cost of Brexit directly.
Politicians fear reigniting one of the most toxic debates in modern UK history, splitting parties and dinner tables irrevocably.
Labour - previously the remainer party - made their position during the campaign clear: no single market, no customs union, no freedom of movement. Keir Starmer, just before the election, declared that Britain “would not rejoin the EU in my lifetime.” He is 61 years old.
This denial is becoming untenable. As markets reel from a shock earlier this week that rattled Labour’s economic plans, questions about the UK economy’s resilience have resurfaced.
If government borrowing costs continue to rise, Labour will face stark choices: hike taxes further or slash public spending—neither of which will deliver the prosperity that voters demand. Meanwhile, commentators and economists lament the ongoing refusal to confront Brexit’s role in the UK’s economic decline.
But today, there are signs of a shift. The Liberal Democrats have announced plans to push for a formal customs union with the EU, a move aimed at boosting growth and insulating the UK from the effects of a Trump presidency, as the President-elect’s supposed tariffs loom large over Europe. In a speech today, Ed Davey argued that ministers must be “far more ambitious” and go beyond “tinkering around the edges of the botched [Brexit] deal the Conservatives signed four years ago.”
Calling for immediate talks, with a target of implementing a customs union by 2030, Davey will frame this as “the single biggest thing we can do to turbocharge our economy in the medium and long term.” He’ll also highlight the potential benefits of closer trade and defense ties with the EU, emphasising the need to “Trump-proof” the UK against future global shocks.
Even on the Conservative flank, cracks are emerging. Tory leader Kemi Badenoch will also today admit that it is a mistake for the UK to leave the European Union “before we had a plan for growth outside the EU.” This rare concession - though still miles away from admitting that Brexit was a mistake - demonstrates growing recognition within the party of the flaws of it’s no-deal approach.
Rejoining the EU isn’t a magic bullet for the UK’s woes. But strengthening ties with our European allies, re-entering the single market, and forging new trade agreements would bring significant benefits, especially as the UK enters a new global age of uncertainty and shifting alliances.
As the UK in a Changing Europe thinktank notes: “The UK will be welcome not just for its net contribution to the EU budget but for what it could bring in terms of law, trade, science, education, and global political clout [...] Reversing Brexit will not solve every problem, but it will put the country back on a promising trajectory, affirming that Britain is, after all, a modern European country.”
Public regret for leaving the EU continues to grow. And while the Liberal Democrats take the lead on making the case for re-joining, and even the Conservatives begin to acknowledge their mistakes, Labour risks falling behind.
Keir Starmer has an opportunity to reshape Britain’s future by championing a bold vision for rebuilding EU relations. He must not let this moment pass.
About the author: Zoë Grünewald is Westminster Editor at The Lead and a freelance political journalist and broadcaster. She has worked in and around Westminster for five years, starting her career as a parliamentary clerk before throwing away the wig and entering journalism. Zoë then worked as a policy and politics reporter at the New Statesman, before joining the Independent as a political correspondent. When not writing about politics and policy, she is a regular commentator on TV and radio and a panellist on the Oh God What Now podcast.