Sir Keir Starmer must “fire the starting gun” on creating a new customs union with the EU, the Prime Minister has been told ahead of a meeting with European leaders.
Such a move will put “rocket boosters” on the UK economy and will “strengthen our hand” against Donald Trump’s US, which is threatening tariffs against trade partners, Liberal Democrat leader Sir Ed Davey told the BBC.
On Monday, the Prime Minister will join European Council leaders at an informal retreat ahead of an EU-UK summit later this year.
The focus of the dinner he will attend is expected to be defence co-operation.
But the Lib Dems have called for him to begin talks with the trade bloc on deeper ties.
The Government has ruled out joining the customs union or single market, declaring them both “red lines” in its negotiations with European leaders.
However, it has left open the possibility of joining a continent-wide trade deal called the Pan-Euro-Mediterranean (PEM) convention, as Sir Keir continues with his aim to “reset” the UK-EU relationship.
The deal, which would allow tariff-free movement of some goods across Europe, as well as some nations in North Africa and the Levant, should be a “first step” to re-joining the customs union, the Lib Dems have said.
Their leader Sir Ed has written to Chancellor Rachel Reeves, calling on her to commission the Office for Budget Responsibility to assess the impact of a new customs union with the EU on the UK economy.
“The Chancellor is tying herself in knots trying to think up new ways to grow our economy,” Sir Ed told the BBC.
“But there’s a solution right under her nose: a new UK-EU customs union deal that boosts trade for British businesses and raises vital tax revenue for our public services.”
While the Lib Dems are pushing Sir Keir to go further in deepening ties with the EU, the Tories have called on him to not accept further EU influence as he seeks to strengthen the relationship.
The Prime Minister must meet five “tests” to uphold Brexit, Kemi Badenoch said.
Among the Tory leader’s tests are commitments to: no “backsliding” on free movement or the compulsory transfer of asylum seekers; no new money paid to the EU; and no reduction in fishing rights.
She also urged Sir Keir not to take any rules from the EU as he engaged with the bloc, including dynamic alignment on trade standards, or allowing the European courts to have jurisdiction over UK law.
Nato must have “primacy” when it comes to European security, the Tory leader said in her final test for the PM.
“Five years ago the Conservatives broke the deadlock and got Brexit done,” Mrs Badenoch said.
She added: “We delivered the biggest democratic mandate in our country’s history. Keir Starmer and his Labour party opposed us every step of the way – they tried to cancel the referendum and stop us taking back control.
“Now Keir Starmer and the Labour Government are trying to reopen the divisions of the past and edge us back into the EU. So I’m setting Keir Starmer five tests to make sure he doesn’t undo Brexit.
“These tests will ensure we seize the opportunities of the future and use our independence to grow the British economy. Under my leadership, the Conservatives will always stand up for Britain and fight for our hard-won freedoms.”
A Labour spokesperson described the Brexit “tests” as “yet more hypocrisy from Kemi Badenoch and the Conservatives who had eight years to make a success of Brexit but failed”.
They added: “After running an open border experiment that resulted in record high net migration, the Conservatives completely botched the job on Brexit – a record so bad that Kemi Badenoch herself publicly criticised Conservatives’ ‘mistakes’ on Brexit in her first speech as leader.”
