Labour could avoid potential economic and political turmoil in this week’s Budget by indicating it’s ready to change its tune on Brexit, the Rejoin EU Party says.
Chancellor Rachel Reeves is reportedly planning to freeze income-tax thresholds and hike tax in other areas to try to plug a gap in the public finances that some reports have suggested could be as high as £30bn.
City analysts have warned that the measures could hit the bond market and spark a challenge to Keir Starmer’s leadership if they fail to shore up fragile investor confidence.
But Labour could avoid all this – and benefit from the immediate boost to market sentiment that would follow – if it signalled a willingness to consider re-joining the European single market, customs union and ultimately the EU itself, the Rejoin EU Party says.
Rejoin EU believes the economic boost from removing the mountain of extra red tape and trade barriers caused by Brexit would more than cover the economic black hole facing the government.
It comes after a study by US-based research group National Bureau of Economic Research suggested that the economic damage from Brexit could be double the 4% hit to GDP that economists originally forecasted.
Rejoin EU Party Chairman and former MEP Brendan Donnelly said: “It’s become clearer with every week and every academic study that passes that the economic damage from Brexit is even greater than the most pessimistic predictions.
We’ve had one recently suggesting the loss might be as high as 8%, which would easily plug any funding gap that Rachel Reeves might think she has to fill.
“Reeves wants to have her cake and eat it. She claims, rightly, that Brexit has damaged the British economy, but also continues to imply that the fault lies with the kind of Brexit we have, not with Brexit itself.
Reeves and Starmer should do themselves a favour by acknowledging that the only realistic solution to the UK’s growing economic and political impasse is to re-join the EU.