LONDON — Two senior Labour figures insisted on Wednesday night that the party has not ruled out staying part of the single market, in what represents another major Brexit U-turn.
Shadow Chancellor John McDonnell and Shadow Brexit Secretary Keir Starmer last night said retaining the benefits of the single market is so important that no options should be swept off the table — including Britain continuing as a member.
This is a clear departure from comments by the Labour leader Jeremy Corbyn last weekend when he ruled out staying part of the single market after Britain leaves the European Union, claiming single market membership is “inextricably linked” with EU membership.
The single market is dependent on membership of the EU,” Corbyn told the BBC’s Andrew Marr on Sunday.
“What we have said all along is that we want a tariff-free trade access to the European market and a partnership with Europe in the future. The two things are inextricably linked so the question then is the kind of trade relationship of the future and we have made it very clear we want a tariff-free trade access with the European market.”
However, both McDonnell and Starmer offered a different policy on Wednesday night, suggesting that a Labour government could keep Britain in the single market if it was the only means of retaining benefits of membership.
Here’s what Starmer told a Labour in the City event (emphasis ours):
“Labour’s objective is tariff free access to the single market, no new red tape at customs and a deal that works for services as well as goods. It is vital that we retain the benefits of the single market and the customs union. How we achieve that is secondary to the outcome and should be part of the negotiations. We need to be flexible in our approach and not sweep options off the table.”
And here’s what McDonnell said in an interview with the BBC (emphasis ours):
“Our objective is tariff-free access to the market. That has been our objective since immediately after the referendum. The structures — whether we are in or out — are a secondary matter. We are not ruling anything out but what we are saying is that we are the fifth largest economy in the world and we have a special status in both our relationship with the EU and the rest of the globe and we feel we can get a deal that achieves tariff-free access.”
These latest remarks come after Labour’s election strategist Andrew Gwynne claimed on Tuesday that the party would be willing to oppose Brexit in the future if the public mood on whether Britain should leave the EU shifts.
McDonnell and Starmer’s remarks are the latest in a series of confusing statements from Labour figures on what the party’s position on Britain’s relationship with the EU after March 2019 should be.
On Tuesday Corbyn distanced himself his own Trade spokesman when a spokesperson told Business Insider that staying part of the customs union hasn’t been ruled out as Labour Party policy.
On Monday, Shadow Trade Secretary Barry Gardiner told the BBC that staying in the customs union, which manages the trade of goods within the EU, would be a “disaster,” adding in an article for the Guardian that it was simply “not possible” to remain in the arrangement after Brexit.
However, a spokesperson for Corbyn slapped down Gardiner, telling BI: “We need to be flexible in our approach and not sweep options off the table.”
What is the single market? And why does it matter?
The single market is the EU’s core free trade arena in which there are no tariffs, quotas or tax, also known as the “internal market.” In order to be a member of the single market, though, member states must comply with the EU’s four freedoms — the free, unlimited movement of goods, services, capital and people between all 28 member states.
The free movement of people is the most contentious of the four freedoms, as it has resulted in high levels of immigration of EU citizens to western member states like the UK.
Whether Labour should offer Brexit policy based on remaining inside the single market is a question that has split the party down the middle in recent weeks. Europhile MPs like Chuka Umunna and Wes Streeting have pointed out that countries like Norway and Lichenstein are within the single market despite not being members of the EU, as they are part of the European Economic Arena (EEA). A number of Labour MPs have expressed concern about staying inside the single market, though, as it would effectively mean the continuation of EU rules, including the four freedoms.
The vast majority of economic experts agree that leaving the single market will have a negative impact on jobs and leave a gap in Britain’s trade that would be very difficult fill via new free trade deals with countries outside the EU.