Britain’s economic growth ‘does not depend on the EU’, a leading economist has warned the new government.
Dr Gerard Lyons has urged the Prime Minister to stand firm against calls to rejoin the single market, saying he should instead take ‘full advantage’ of Brexit.
He argued that it was best to ignore pro-Brussels voices who ‘overstate’ the benefits of membership and said Labour should instead focus on domestic challenges.
‘The Government needs to have the confidence to stand its ground on remaining outside of EU institutions,’ he wrote in a paper for the Centre for Policy Studies.
‘Rejoining the EU, its single market or its customs union will not provide a solution to the UK’s growth challenge and should not be part of any pro-growth strategy, despite the recent clamour from some for this,’ he went on.
Dr Gerard Lyons, who previously advised former PM Liz Truss, has also hit out at previous Tory governments over their Brexit policies
‘The major challenges facing the UK have long predated Brexit and solutions are not reliant on being in the EU.’
Dr Lyons’ comments, as reported by The Telegraph, come after Sir Keir Starmer promised his government would oversee a ‘reset’ of relations with Europe.
While he has pushed for a closer trade relationship, the Labour leader has repeatedly ruled out rejoining the single market or customs union.
That pledge, along with the rejection of a possible return to freedom of movement, was outlined in Labour’s manifesto, and is described as one of the ‘red lines’ Starmer will not cross in his pursuit of a better trade deal with Brussels.
Such commitments put the Labour leadership at odds with some of their MPs and a large section of supporters, who continue to favour rejoining the bloc.
Dr Lyons argued that much of the ‘clamour’ around the benefits of the single market was ‘based on a misunderstanding of our underlying growth issues’.
He pointed out that Britain’s persistent trade deficit first developed in the 1980s, while it was an EU member.
He added that any future relationship with the EU should not be based on ‘wishful thinking’ but on ‘an accurate assessment of the current situation’.
The economist, who previously advised former PM Liz Truss, has also hit out at previous Tory governments and what he described as their failure to ‘ deliver a properly thought-out post-Brexit economic policy‘.
It comes after Sir Keir Starmer promised his government would oversee a ‘reset’ of relations with Europe
He contended that by not capitalising on the potential benefits of leaving the EU they had ‘helped to create an economically damaging narrative about the UK on the global stage’.
After his election last month, the new PM vowed to improve what he called the ‘botched deal’ signed by former premier Boris Johnson.
Speaking in Belfast, Starmer said his new government would first need to implement changes under the current agreement to build trust with the European Union.
‘We’re not going to be able to get a better relationship unless we’ve demonstrated commitment to the relationship and the agreements that have already been put in place,’ he said.
But last week, it was reported that Brussels presented the UK with a list of demands in return for closer ties.
Commission vice-president Maros Sefcovic set out eight demands during his first meeting with Europe minister Nick Thomas-Symonds last month.
They include fully implementing the existing Brexit agreements on Northern Ireland, and gold-plating the rights of EU citizens living in Britain as a ‘test of good faith’, according to the FT.
