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An Caution for Keir Starmer drawn from His Own History: If You're Not Bold regarding Britain's EU Exit & the EU, Your Labour Rivals Will Be.

Back in 2018, a mere a short phrase to ignite the party's annual gathering and to show Labour was falling out of love with its then leader. While not exactly stirring rhetoric, the phrase were greeted with rapturous applause as most of the hall stood for spontaneous acclamation.

When the noise subsided, Keir Starmer, remained at the lectern, blinking in surprise. He was unaccustomed to his addresses producing such a reaction. His statement was simply: "Nobody is ruling out staying in the EU". But context is everything.

During that deeply polarized period in 2018, departing from the prepared script in this way was always going to be seen as laying down the gauntlet to Jeremy Corbyn, who sought to prioritize leave supporters in working-class seats over the pro-European instincts within Labour. In just one speech, this seemingly cautious shadow Brexit secretary underwent a transformation – if only for a while – into a political gambler who championed most Labour MPs, members and voters against a leader he would later replace.

The Shift in Position & Closed Debates

In the years since, much has happened, not least to Starmer himself. An early move upon assuming leadership from Corbyn in 2020 was to declare the EU question was resolved by the previous year’s general election. And, at the last one, he consistently stressed manifesto “red line” commitments that ruled out rejoining the European Union or its core structures.

Like his predecessor, his strategy has been to pursue Brexit-y voters in target constituencies, even if survey data indicates many of them have passed away or shifted opinion.

A Lid That Rattles on the EU

However, it’s now Starmer is now to face the pressures of being a Labour leader. And, if EU relations is no longer the boiling pot of British politics, the cap that has been kept firmly shut since Brexit is beginning to rattle again.

Both Starmer and Rachel Reeves have ramped up their language regarding the damage caused by Brexit has caused to the UK’s economy. It’s a useful stick to criticize the Reform UK leader, who seldom discusses how leaving the EU was his primary goal and remains his sole political accomplishment.

And yet, the scale of the damage, reportedly has left Britain with an economy that is significantly diminished than if it were still in the EU, dwarfs the minor adjustments thus far implemented by the government. Starmer’s so-called relationship reset agreed with Brussels in 2024 offers economic benefits quantified in fractions of a percent.

Cabinet Divergence and Bolder Ideas

The chancellor is among those attempting to bypass long-standing interior ministry opposition to a broader scheme designed to boost growth youth mobility scheme allowing youths can travel between the UK and the EU for work or study.

The deputy prime minister has pondered publicly about the “self-evident” benefits of joining an EU customs pact, while a dozen Labour MPs, such as the head of the Treasury select committee, last week supported a Liberal Democrat motion on joining one.

Although Nick Thomas-Symonds, the minister in charge of EU policy, who is now attending every cabinet meeting, maintains the red lines are still in place, there are ways these could be bypassed. One idea would be to announce the start of negotiations now for a more ambitious agreement, for inclusion in the following election platform, to be enacted only after securing a new electoral mandate.

Starmer's Deep-Seated Doubts

Yet, Starmer has most recently pouring cold water again by warning a return to a European customs area could undermine the commercial agreements with the US, which he views as key accomplishments of his government.

It is understood that the PM’s scepticism run even deeper, stemming from several key concerns.

  1. Firstly, he believes any customs union agreement is now much harder because his ministers actively diverging from EU regulations across a range of sectors, including the environment.
  2. Secondly, the prohibitive cost set for the UK for entry into the EU’s new defence fund and the subsequent collapse of negotiations has led UK negotiators that European nations have little interest in cutting special deals to the UK than in proving that leaving the EU was a mistake.
  3. Thirdly, the new US national security strategy, praised by the Kremlin, is seen by key advisors in Downing Street as grounds for Britain to keep its distance from the EU.

A Bizarre Strategy and Strategic Calculations

This strange and concerning American strategy paper asserts Europe is threatened by cultural extinction because of immigration. It includes a single mention to Britain, found on a proposal that the US government may interfere in British politics to encourage the growth of nationalist movements.

However, instead of concluding that this renders America an undependable ally, ministers is worried that deeper EU integration would destabilise geopolitics further by endangering fragile US military support for Kyiv, NATO, and other alliances.

Succession Chatter and The Ghost from the Past

This situation brings us back to 2018. The PM has consistently stated that address was not a pitch to become leader but merely an effort to preserve the “option” of remain in a future vote. In fact, in those days, Starmer still favoured a “bespoke customs union deal” similar to the one he currently seems to reject.

But it’s not been lost on Downing Street note that the Health Secretary, who just about everyone assumes would be a candidate in any leadership election, is part of a group of senior ministers signaling they desire greater ambition regarding the EU.

Aides to Angela Rayner, another likely contender in a future race to replace Starmer, maintain she won’t discuss her position on a customs union because it would only “fuel unnecessary gossip”.

The Obvious Risk and A Prudent Reminder

The risk is clear. If Starmer rules out more meaningful steps towards EU alignment, he cedes ground to claim the territory where most of the party's supporters reside.

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

MC
Written by

Megan Calhoun

A seasoned financial analyst with over 15 years of experience in investment banking and wealth management.

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