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A Warning to Keir Starmer drawn from His Own History: If You're Not Bold regarding Britain's EU Exit and Europe, His Party Challengers Shall Be.

Back in 2018, a mere eight words to energize a Labour conference demonstrating Labour was becoming disillusioned with its then leader. Although not exactly soaring oratory, the phrase were greeted with wild cheering as most of the hall stood for spontaneous acclamation.

As the commotion died down, the then-Brexit spokesman, remained at the lectern, visibly startled. He was unaccustomed to his speeches having such an effect. All he had said was: "Nobody is ruling out staying in the EU". But context is everything.

During that deeply polarized period in 2018, straying from his agreed text in this way was always going to be seen as laying down the gauntlet to Jeremy Corbyn, who sought to prioritize leave supporters in key constituencies above the Europhile sentiments within Labour. In just one speech, this grey-suited shadow Brexit secretary was transformed – if only for a while – into a risk-taker who would stand up for most Labour MPs, members and voters against the leadership he later succeeded.

The Evolution in Position and Closed Debates

In the years since, the landscape has shifted, not least to Starmer himself. An early move after taking over in 2020 was declaring the Brexit issue was resolved by the 2019 national vote. During the most recent campaign, he repeatedly emphasised manifesto “red line” commitments that ruled out rejoining the EU, the single market or a customs union.

Similar to Corbyn, the PM's approach has focused on winning pro-Leave voters in target constituencies, even if polling evidence suggests many of them have passed away or shifted opinion.

Pressure Building on the EU

Yet, the tables have turned and Starmer is now to face the pressures of being a party leader. While EU relations is no longer the central crisis in UK politics, a lid which was firmly shut since Brexit is beginning to rattle once more.

The Prime Minister and Chancellor have ramped up their language about the devastation that leaving the EU has caused to Britain's economic standing. This serves as an effective tool to criticize Nigel Farage, who seldom discusses how leaving the EU was once his singular purpose and is still his sole political accomplishment.

Nevertheless, the scale of the damage, which by some estimates has left Britain with a national economy that is between 6% and 8% smaller than if it were still in the EU, towers over the minor adjustments thus far implemented by ministers. Starmer’s so-called relationship reset negotiated with the EU in 2024 provides gains measured in low decimal points.

Cabinet Divergence & Ambitious Proposals

Rachel Reeves is among those trying to overcome long-standing interior ministry opposition to an expansive version of a growth-enabling program for young people by which young people can travel between Britain and Europe for work or study.

David Lammy muses openly regarding the “self-evident” benefits of being in a customs union with the EU, while a dozen Labour MPs, including the chair of the powerful finance committee, recently supported an opposition proposal on customs union membership.

While the Europe minister, the minister in charge of UK-EU relations, now present at all cabinet sessions, insists the firm boundaries remain unchanged, there are ways to work around them. A proposal would be to announce the start of negotiations now for a more ambitious agreement, to be featured in the next manifesto, with implementation only if securing a fresh mandate.

The Prime Minister's Fundamental Doubts

Yet, Starmer has most recently pouring cold water on the idea by warning a return to an EU customs arrangement would “unravel” the trade pacts with the US, which he regards as signature achievements of his government.

It is understood that the PM’s scepticism go still deeper, and is rooted in several key concerns.

  1. Firstly, he believes a customs pact is now much harder as ministers are actively diverging from EU regulations across a range of policy areas, like environmental standards.
  2. Second, the exorbitant price set for the UK for entry into the EU’s new defence fund and the ensuing failure in talks has convinced UK negotiators that former EU partners have little interest in cutting special deals to the UK and are more focused on proving that Brexit does not work.
  3. Thirdly, the new US national security strategy, praised by the Kremlin, is seen by key advisors in Number 10 as a reason for the UK to maintain distance from the EU.

A Bizarre Document & Strategic Considerations

This bizarre and terrifying document asserts Europe is threatened by “civilizational erasure” due to Muslim migration. It includes a single mention to Britain, placed beside a proposal that Donald Trump’s administration will intervene in British politics to encourage the rise of nationalist movements.

However, instead of deciding that this makes the US an undependable ally, the government reportedly fear that deeper EU integration would destabilise geopolitics further by risking precarious American backing for Ukraine, Nato and much more besides.

Succession Chatter & The Echo of 2018

This situation returns us to 2018. Starmer has always said his speech was not a pitch for the leadership but simply an attempt to keep open the “option” of staying in the EU being on the ballot paper. Indeed, back then, he still supported a “bespoke customs union deal” of the kind he now appears to be opposing.

Observers within Downing Street note that Wes Streeting, widely considered would be a candidate for the leadership, is among a group of senior ministers signaling they desire greater ambition regarding the EU.

Staff for Angela Rayner, another likely contender in a future race for the top job, insist she won’t discuss her stance regarding a customs pact because it would only “escalate unhelpful speculation”.

The Obvious Danger & A Wise Memory

The risk is clear. Should the PM reject more meaningful steps towards EU alignment, he allows rivals to occupy the space where most of Labour MPs, members and voters reside.

It would be wise of him to recall the impact that a short phrase had on his career in 2018. There are options for a big offer on EU relations which the PM should not “rule out”; he should prise them open himself, rather than letting rivals adopt them as their own.

SC
Written by

Shelly Clayton

A seasoned financial analyst with over a decade of experience in UK investments and venture capital, specializing in emerging market trends.

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