The UK’s eventual return to the European Union’s single market should not be ruled out, London Mayor Sadiq Khan has said, despite Sir Keir Starmer making it a red line in his “reset” talks with Brussels.
Mr Khan acknowledged there was no short-term hope for rejoining the single market, which would give greater trade access to the bloc but would also come with the return of freedom of movement.
He said, however, that barriers to trade with the UK’s closest neighbours should come down and the single market was “something we shouldn’t be scared to talk about”.
Mr Khan was slapped down by Chancellor Rachel Reeves, who said Labour should not rip up its election manifesto’s commitments on the EU now that it is in office.
The Prime Minister has made resetting relations with the European Union a priority, although it is not clear how much can be achieved within his red lines, which include ruling out a return to the single market or customs union.
He also said he has no plans to sign up to a youth mobility scheme which has been proposed by Brussels.
But Mr Khan backed the idea of a scheme for young Britons to live and work in the EU, and vice versa.
Speaking at the Government’s international investment summit, he told the PA news agency: “I’m quite clear that all successful countries do the most trade with their nearest neighbours, that’s one of the signs of success.
“We’ve got on our doorstep, not just friends and colleagues and family indeed, we’ve got a market of more than 500 million people.
“The good news is the Prime Minister spent a lot of the last three months visiting friends in Europe, whether it’s the president of France, the prime minister of Italy, the chancellor of Germany or the European Union, indeed, in Brussels.
“The current Brexit deal we have comes up before review next year. I’m hoping, unlike last time, there will be closer alignment, rather than divergence.
“We should be looking at a whole host of issues and talking about them – whether it’s a youth mobility scheme, whether it’s seeing what we can do to bring people closer together.
“I think the reality is, in the short term, we probably aren’t going to get back as members of the single market. But it’s something we shouldn’t be scared to talk about.”
The Chancellor told reporters at the summit: “This is a government that plans to stick to the manifesto we were elected on. We got a big majority in that election to implement what is in our manifesto, not to rewrite history and now say that we have a mandate to do something else.
“So our red lines are around the single market, the customs union and bringing back free movement, and we will stick to that manifesto.
“But we’re also clear in our manifesto that we do want to reset relations and improve our trading relationships with our nearest neighbours and trading partners.
“At the moment, especially for small businesses that are the lifeblood of any economy, being able to import and export from countries that are nearest to us is unnecessarily burdensome, and as a result, many small businesses no longer export.
“Well, to grow as a company, you need to be expanding into new markets. And so we want to make it easier for small businesses to trade with other countries, including in the European Union.”
She said the Labour manifesto committed to seeking improvements for touring artists, a veterinary agreement and mutual recognition of professional qualifications and “those are some of the areas that we want to pursue”.
Sir Keir used an appearance on the main stage of the investment summit to acknowledge that Brexit had damaged the UK’s international standing.
He said: “The reset on the international stage has to come alongside what we are doing on investment.
“Whichever way people campaigned and voted on Brexit, one of the consequences to my mind was that the impression was given that the UK was more interested in turning in on itself and becoming more isolated and less interested, frankly, in the outside world than we once were.”
In his summit keynote speech, he said: “People want to know that Britain can be a stable, trusted, rule-abiding partner. As we always have been.
“But that, somehow, during the whole circus that followed Brexit, the last government made a few people less sure about.
“Needlessly insulting our closest allies, and of course a few choice Anglo-Saxon phrases for business.
“Well – no more. We have turned the page on that – decisively.
“And we will use that reset for growth.“
