Words by Policy and Media Adviser, Mark English, and Communications & Manager, Michael Anderson.

In his interview with Laura Kuenssberg at the weekend, Keir Starmer said plainly that closer alignment with the EU’s single market is in the UK’s national interest. This is a welcome moment of honesty. But if the government is serious about boosting growth, cutting the cost of living and repairing the damage done by Brexit, why not cut out the hesitancy and the baby steps? 

Now is the time for the Prime Minister to argue forcefully not just for alignment with bits and pieces of the world’s biggest market, but for joining the whole thing again.                                                                                                                           

There is also increasing talk in Westminster of the UK negotiating a customs union with the EU. This idea is being driven forward by the Liberal Democrats, the Greens, Labour backbenchers and even Health Secretary Wes Streeting and Deputy Prime Minister David Lammy.

A customs union would cut some border friction and reduce paperwork. It would especially benefit sectors - such as vehicle manufacturing - which use a high proportion of components that do not originate in the UK or the EU. UK products based on such global supply chains - unlike most of our goods - are currently subject to tariffs on entering the EU. A customs union would remove that burden.

But we must be clear-eyed. On its own, a customs union would not underpin the fundamental economic reset the UK needs.

The majority of Brexit red tape affecting UK goods exports consists of regulatory checks on the conformity of products with EU single market rules, not customs procedures. Those checks would no longer be necessary if the UK were back in the single market, and once again had the same rules as most of the rest of Europe and belonged to a common system of enforcement.

UK service providers, for their part, are mostly unaffected by customs regulations. But outside the single market, many are finding it impossible to trade with the EU at all and those that do face a daunting list of hurdles.

All this means that taking the UK fully into the EU single market would be far more impactful than either a customs union or half-hearted alignment with single market rules in just a few sectors. It would provide British businesses of all types and all sizes with renewed opportunity and certainty. Negotiating a return to the single market across the board might even prove somewhat easier than continuously negotiating and updating piecemeal deals. Above all, it would open up growth and jobs across the economy, which is exactly what the government was elected to do. 

So, how can Starmer and his government realistically move the UK in that direction? We see four clear steps.

1. Say openly that the single market is the goal

The first step is leadership. The Prime Minister should build on what he told Laura Kuenssberg and be upfront that not only closer alignment with the single market, but ultimately joining it, is in the national interest. A customs union with the EU would bring significant benefits as far as trade in goods is concerned - and ideally the UK should be in one. 

But a customs union should not be presented as an end point on its own. After all, Norway, Iceland and Liechtenstein are in the whole of the single market but not in a customs union with the EU. Switzerland, for its part, is in the single market for goods without a customs union.

2. Speed up progress on dynamic alignment

The steps to get closer to the EU single market already set out at the UK-EU summit on 19 May 2025 are important and welcome. The agri-food industry is one of those worst affected by Brexit and it is right that a new agreement fixing that should be a top priority - it needs to be finalised urgently. The UK’s return to the EU’s single market for electricity will also be a major benefit for both parties. Alignment of emissions trading systems and carbon border taxes - if delivered - will avoid further major trade barriers springing up.

But all that still leaves whole swathes of industry behind in the Brexit mire. We also need - and quickly - dynamic alignment with EU rules in other key sectors such as chemicals, medicines and engineering. This would bring immediate economic benefits and signal to the EU that the UK is serious about rebuilding trust through shared standards. It could also make negotiating full single market membership much easier when the time comes.

3. Make the case for free movement as integral to the national interest

Participation in the single market requires free movement of people. That remains politically sensitive, but it cannot be wished away and should instead be embraced.

As Starmer suggested in his interview, policy choices must be guided by the national interest. The return of free movement would restore to everyone in the UK the right to work, study or retire across the 31 countries in the single market. It would remove major and minor irritations now encountered by business and holiday travellers. Just as importantly, the UK’s history tells us that free movement would be good for our economy - it supports growth, helps address skills shortages and reduces pressure on prices.

The government should therefore make the honest case that free movement is part of a broader economic settlement that benefits workers, businesses and people of all ages across the UK. Business wants free movement back. And polling suggests that the wider public would also be receptive.

4. Move with public consent and explain the reality of ‘rule-taking’

Rejoining the single market can only happen when public opinion is ready and there is a clear mandate for doing so. That is essential. But the government also needs to explain the current reality. In practice, the UK already follows many EU rules because divergence creates further barriers for British businesses. But we now do so without securing the full economic benefits and with next to no influence.

Single market membership would unlock those benefits and provide us with a clear mechanism for making input - albeit limited - into the policy process, just as, for example, Norway does now. So if the Prime Minister truly believes, as he told Laura Kuenssberg, that getting much closer to the single market is in the UK’s national interest, then his government must not be content with aligning with parts of it. The UK must join it.

Over time, that logic also points towards the ultimate objective: full EU membership, with a vote and a voice.