Outrage as Rachel Reeves’ Brexit betrayal ‘to price UK £40bn a 12 months’ | Politics | News | EUROtoday

Rachel Reeves’s insistence that nearer ties with the European Union characterize Britain’s “biggest prize” is an outright Brexit betrayal that can price the UK financial system as much as £40 billion a 12 months, a number one assume tank has warned. The Prosperity Institute mentioned Sir Keir Starmer’s accelerating pivot in the direction of Brussels is “fatally flawed” and can inflict lasting injury on development, commerce and sovereignty.

Re-entering a customs union — a transfer now overtly supported by some senior Labour figures, together with David Lammy and Wes Streeting — would shave 0.5% off GDP within the first 12 months, rising to a 1.35 % collapse by 12 months 5, the equal of £30-40bn in misplaced output yearly, says the Institute. Economist Fred de Fossard mentioned: “British businesses have thrived since leaving the EU. While some people say lower trade barriers with Europe make rejoining worthwhile, the data doesn’t bear this out.

“The EU economy is in decline, demand for goods is much lower than in the past, its industrial base is being eroded and the bloc is not the economic powerhouse it once was.

“British businesses would be locked into that decline and shackled to a captive market. This is what the EU wants and we shouldn’t give it to them.”

The Institute’s report warns that deeper alignment would increase commerce obstacles with faster-growing markets within the US and Indo-Pacific, erode Britain’s impartial commerce coverage (which has already secured over 70 offers value £164bn) and expose the UK to larger regulatory prices.

Alignment would drive up AI prices by imposing a 57.5 % improve in carbon costs on information centres, reported The Telegraph.

It would additionally danger scary Donald Trump and torpedoing a commerce take care of the world’s largest financial system. The US president has repeatedly attacked the EU’s sluggish development and purple tape.

Britain has already paid a heavy worth for the “reset” deal struck final 12 months. In change for aligning with EU plant and animal well being guidelines, the UK surrendered 12 years’ entry to its fishing waters.

Farmers warn the modifications will wreak havoc on agriculture, imposing harsher requirements on British meals manufacturing. Dozens of pesticides and herbicides permitted within the UK are banned in Europe.

Labour’s resolution to rejoin the Erasmus Plus programme has additionally come beneath hearth. The Institute mentioned: “It would force Britain to issue visas to tens of thousands of EU residents and spend taxpayer money subsidising European universities with little benefit to taxpayers, students, or researchers.”

The findings expose the gulf between Labour’s rhetoric and its actions. The 2024 manifesto dominated out rejoining the customs union. In December, Sir Keir insisted: “It is not currently our policy.”

However, simply weeks later he urged better alignment, whereas 13 Labour MPs backed a Liberal Democrat invoice to start negotiations on a bespoke customs union.

A Government spokesman mentioned: “We are focused on delivering deals that could add up to £9bn a year to the UK economy, supporting producers and businesses, backing jobs, and putting more money in people’s pockets across the entire country.

“Our new strategic partnership with the EU is in our national interest. It’s good for bills, good for our borders, and good for jobs, without compromising on our red lines – no return to the customs union, no return to freedom of movement, and no rejoining the single market.”