Rachel Reeves has sparked fresh fears of Brexit betrayal as she claimed developing closer ties with the European Union would be the ‘biggest prize’ for Britain.
The Chancellor described the deal Sir Keir Starmer agreed with Brussels last year as merely ‘first base’ and vowed that the Labour Government would go much further.
She admitted ministers had been worried about the ‘pushback’ they would get from Leave voters but insisted they could win the political argument.
She said she was ‘up for’ further alignment with EU rules in areas such as financial services, and wanted to make it easier for ‘talent to come to the UK’ in a scheme allowing young Europeans to live and work here.
And she criticised the referendum vote a decade ago as ‘pulling up the drawbridge’, stressing that it was not her choice.
Speaking at an event at the London School of Economics yesterday, Ms Reeves hailed the post-Brexit deals agreed between the UK and the US and India but went on to say: ‘The biggest prize is clearly with the EU.’
She said she was ‘so pleased’ with the Government’s decision in December to rejoin the Erasmus student exchange programme – despite outrage at the predicted £6billion cost.
In addition, she hoped there would soon be ‘concrete progress’ on the talks between the Prime Minister and European Commission president Ursula von der Leyen last May on food checks, as well as on energy trading and an ‘ambitious youth mobility scheme’.
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She continued: ‘As we said at the time last year, at that summit that was sort of first base really.
‘The truth is economic gravity is reality, and almost half of our trade is with the European Union. We trade almost as much with the EU as the rest of the world combined.
‘I’m all up for doing deals with India and the US and Korea, but none of them are going to be as big as what we can get through better trade relations with Europe.’
Asked what the next step should be, she replied: ‘I think further integration will require further alignment. But I’m up for that. My government, Keir’s government, is up for that.
‘Some of that can be unilateral and some of it can be negotiated, but I think there’s opportunities there.’
Ms Reeves said that London was one of the three major financial centres in the world and added: ‘The City of London is part of what we have to offer the EU, we don’t want to create more barriers. We will be bringing those barriers down.’
She also said there were three big trading blocs globally – the US, China and Europe – and added: ‘We want to make Europe as strong as possible, and that means not pulling up the drawbridge. I know we did that when we voted to leave – not me, but the country made that decision.’
Ms Reeves admitted that after last May’s summit ministers ‘were worried there was going to be a lot of pushback’ with people saying ‘wait a second, we voted to leave’, ‘why are we going to be making it easier to trade again’ and ‘where does this lead’.
But she claimed: ‘I think Erasmus is one of the most popular things that we’ve done as a government, because it is about giving hope that there is a better future and that, we are ambitious for Britain, for our young people.
‘So I am confident that this is a political argument as well that we can win.’
The Chancellor’s comments will heighten fears that Sir Keir will go even further in reversing Brexit freedoms following the departure of his Chief of Staff Morgan McSweeney, who had been keen to court Leave voters in the Red Wall.
The PM recently said he wanted the UK to join a costly EU defence fund and get closer again to the single market, although he has ruled out rejoining the customs union despite some ministers backing the move.
Shadow Chancellor Sir Mel Stride said: ‘It’s no secret that Reeves and Starmer have wanted to row back on Brexit since day one.
‘Labour are desperate to blame anyone but themselves for their economic failures.
‘Under increasing pressure from their own soft-Left colleagues following the Mandelson scandal, Starmer and Reeves would rather point the finger at Brexit than accept their poor choices have been a disaster for our economy.’
