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Andrew Lewin: ‘Ending the cost of living crisis starts with the EU-UK relationship reset’

by Morris
December 26, 2024
in Politics
Reading Time: 3 mins read
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When the chancellor attends the Eurogroup meeting on Monday she and her colleagues from the Eurozone will face a daunting set of challenges. Tariff talk from the USA, war in Ukraine and stalling living standards across much of the western world. In these circumstances it can be easy to be a pessimist, but as a new Labour MP and a pro-European, I am convinced we can turn this into a moment of opportunity. For the first time in a decade, the UK government is not obsessing about how we further distance ourselves from the EU, but has a stated aim of strengthening ties with our closest and largest trading partner.

We start with a very low bar. The Trade and Cooperation Agreement (TCA) gleefully signed by Boris Johnson put up trade barriers between the UK and the 27 members of the European Union and the result has been as sad as it was predictable. Our economy is estimated to be 5% smaller, businesses are suffocated by more red tape and every household is paying at least £250 more per year in food bills as a direct consequence.

No sector has emerged unscathed. Farmers and musicians, researchers and beer-brewers, shop keepers and car manufacturers; all are paying more and earning less because of trade barriers erected in the name of ‘economic freedom’. The Brexit deal isn’t solely to blame for our economic malaise, but there is no question it has compounded our decade and a half of virtual stagnation. The average UK worker would be earning £10,400 more per year today if pay growth had continued on the trend before the 2008 global financial crisis.

In an increasingly dangerous world, low growth doesn’t just squeeze our living standards, it has resulted in fewer resources for our national defence and to support our public services. All of this means that our government has to look at every possible opportunity to grow the economy and ease the cost of living crisis. Therein lies the significance of the chancellor’s presence in Brussels and her comments about the reset of our relationship with the European Union in her recent Mansion House speech.

There is so much that could be on the agenda. Beneficial regulatory alignment monitored by a new EU-UK Regulatory Council, a Youth Mobility Scheme (akin to the 13 we already have with international partners across the world), the mutual recognition of professional qualifications. Greater cooperation on the Net Zero agenda and synchronised taxes on carbon from trade. All are evidence-based proposals from the last report published by the cross-party UK Trade and Business Commission of MPs and industry leaders and all worthy of consideration again.

The politics of our relationship with the EU has changed too. In polling published last week by Best for Britain, 44% of respondents said we should prioritise trading more with the European Union, as opposed to 19% who opted for the US. The difference increases further (48% to 17%) when asking voters who switched from the Conservatives in 2019 to Labour in 2024. Put simply, the type of swing voter who delivered the decisive Labour majority this year is not just open to a closer relationship with the EU, they are actively seeking it.

The public has moved on from the binary Leave/Remain divide, instead the priority for so many voters is action on the cost of living and rising living standards. After all the political turmoil caused by Brexit it might seem brave to talk of a renewed UK/EU partnership, but now is precisely the time for it. To grow the UK economy, a strengthened bond with our largest trading partner is not an optional extra, it is our essential and most important relationship.

Politics.co.uk is the UK’s leading digital-only political website. Subscribe to our daily newsletter for all the latest news and analysis.

The post Andrew Lewin: ‘Ending the cost of living crisis starts with the EU-UK relationship reset’ appeared first on Politics.co.uk.

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