Jeremy Corbyn said on Sunday that a Labour government would leave the single market because remaining in it is ‘dependent on membership of the EU’.
Commentators have been quick to point out that there are four countries in the single market that are not members of the EU. But is there more going on here for Labour?
What is the single market?
The European single market allows free movement of goods, services, money and labour between member countries.
‘Free movement’ means that things and people can cross borders without paying tariffs.
Many of those who campaigned for Leave in the EU referendum said that single market membership means no control over immigration and being subject to too many EU rules and regulations.
Although a number of pro-Brexit campaigners – including Daniel Hannan, a senior figure in the Vote Leave organisation – said before the referendum that they wouldn’t want the UK to leave the single market after Brexit.
But after the referendum, the Institute for Fiscal Studies said that full membership of the single market ‘substantially reduces the cost of trade within the EU’, which they say in turn leads to higher living standards for people in the UK.
Four countries are single market members but not in the EU.
On Sunday, Mr Corbyn said that membership of the single market is dependent on membership of the EU. But the status of four European countries suggests that’s not the case.
The single market is bigger than the EU. It has 32 members: the 28 EU states plus Iceland, Liechtenstein, Norway and Switzerland.
Would campaigning for single market membership be politically feasible for Labour?
On that technical point, then, Mr Corbyn is wrong. Based on the experience of the four non-EU members of the single market, there’s no reason why the UK couldn’t leave the EU but remain in the single market.
But recent comments by his shadow Chancellor, John McDonnell, suggest that Labour may have rejected single market membership because they think the alternative is too politically challenging.
In June, Mr McDonnell said that the party would seek ‘tariff-free access to the single market’ (it’s worth noting that ‘access’ to the single market is not the same as ‘membership’ of it).
He went on to say, when pushed on single market membership, that Labour ‘are respecting the decision of the referendum […] I think people will interpret membership of the single market as not respecting that referendum’.
Could Labour’s rejection of the single market alienate its own members?
From Mr McDonnell’s comments, it seems that senior figures in Labour fear that staying in the single market will alienate pro-Brexit voters, and might be seen as a rejection of the referendum result.
But Labour’s shadow Brexit secretary, Keir Starmer, said in June that he wouldn’t want to take single market membership ‘off the table’.
And after Mr Corbyn’s interview on Sunday, Chuka Umunna, Labour MP for Streatham and Chair of the organisation Vote Leave Watch, was quick to point out that there are four non-EU members of the single market. Mr Umunna later said that ‘Taking Single Market and Customs Union membership off the table in the Brexit talks is the Tory position, it should not be Labour’s’.
Recent polling by the Party Members Project suggests that Mr Umunna may be onto something. According to that data, two-thirds of Labour party members think Britain should definitely stay in the single market. Just 4.2 per cent said they thought the UK should give up single market membership after Brexit.
What does the EU make of the UK’s future in the single market?
So there’s some disagreement within Labour’s ranks on whether the UK should stay in the single market. But perhaps more important is what the key figures on the other side of the negotiating table think.
The German Chancellor, Angela Merkel, said in January that the UK could not ‘cherry-pick’ the terms of its future relationship with the EU after Brexit. And the EU’s chief negotiator, Michel Barnier, has said that it won’t be possible for the UK to achieve the ‘frictionless trade’ for which the government has advocated if we leave the single market.
Jeremy Corbyn is wrong that single market membership is ‘dependent’ on being in the EU – there are four countries in the single market that are not part of the Union.
On a political level, Labour seem conflicted on this issue. Senior members of the party apparently fear that staying in the single market will alienate pro-Brexit voters and might look like they are rejecting the referendum result.
But if that really is Labour’s assessment, it’s a big gamble: many of its own members want the UK to stay in the single market after Brexit.