accuses the Prime Minister of
putting party before country and says any economic case for
ruling out a customs union has ‘collapsed’
Labour’s Shadow Brexit Secretary has criticised for putting party interests
before the interests of British jobs and the economy by delaying
a decision on future customs arrangements with the EU.
made the remarks ahead of a
Commons’ debate on the UK negotiating a new customs union with
the EU.
Analysis commissioned by Labour reveals that ’s decision to rule out a new
customs union with the European Union could cost the UK economy
£24bn by 2033.
Labour has pledged to prioritise jobs and the economy by
negotiating a comprehensive UK-EU customs union that would
protect manufacturing and guarantee frictionless trade with
Europe. It would also help to deliver the commitment of no hard
border in Northern Ireland.
The Government on the other hand has wasted twelve weeks delaying
crucial Commons’ votes on a customs union - the equivalent of a
tenth of the time allocated for the Article 50 negotiations.
Speaking ahead of the debate, the Shadow Brexit Secretary
said:
“Over the past few weeks it has become abundantly clear that
is unwilling and unable to put
the country’s interests first during the Brexit negotiations. She
has wasted twelve weeks of the Brexit negotiations delaying a
Commons’ vote on the UK negotiating a customs union with the EU
for fear of a defeat.
“In light of the Government’s own impact assessments and the lack
of progress on any new trade deals, any economic case for ruling
out a customs union has collapsed. The Prime Minister is now
solely focused on internal party management and masking the
divisions within her government.
“Above all, it shows we have a Prime Minister governing for
narrow party interest, not the national interest. A Prime
Minister for whom a ‘jobs-first Brexit’ means putting her own job
before that of millions of working people.
“It’s time for the Prime Minister to finally listen to what
Labour, trade unions and businesses across the country are saying
and to accept the need for a comprehensive UK-EU customs union
after Brexit.”
Ends
Editor’s Notes:
- The commissioned the House of
Commons’ Library to analyse what the Government’s figures
revealed about the economic costs of the UK not negotiating a
new customs union with the EU after Brexit.
- According to the House of Commons’ Library’s interpretation
of the Government’s analysis:
“The document states on slide 14 that the Government has modelled
the impact of a trade deal with the US and with many more
countries (from the countries in ASEAN, GCC and TPP plus India,
China, Australia and New Zealand). The overall impact
of ‘new trade deals could therefore provide a total
long-term increase of 0.2% to 0.7% of GDP’ (our
emphasis)
“On slide 18 there is a summary of the Government’s analysis of
the impact on GDP in different Brexit scenarios. Within the
overall impact of these scenarios – ‘WTO mitigated’, ‘FTA-type’
and ‘EEA-type’ – the analysis provides breakdowns of the
components that affect GDP. One of these is non-tariff barriers
related to customs processes (this doesn’t include tariffs which
are dealt with separately, if necessary).
“This category, labelled NTBs (customs) in the analysis, is equal
to approximately -1% of GDP in the long run (based on reading off
the chart on slide 18) compared with the baseline scenario of
remaining in the EU. In other words, the analysis
estimates that leaving the EU customs union will lead to a 1%
reduction in the long-term level of GDP relative to staying in
it(our emphasis). This effect is ‘consistent across the
three scenarios in our analysis” (slide 18).’
- On the economic cost of a 1% reduction in GDP, the House of
Commons’ Library states:
“If you increase the OBR’s figure for the level of GDP in 2017 by
25% you get £2,440 billion (in 2015 prices*. In other words, the
baseline level of GDP used in the analysis is probably around
£2,400 billion. Therefore 1% of that is
approximately £24 billion (our
emphasis), 0.5% is £12 billion and so on.
*All estimates in the analysis are in real (inflation-adjusted)
terms, shown here in constant 2015 prices (the current base
period for GDP calculations).”
