UK-EU Customs Union (Duty to Negotiate)

Al Pinkerton Excerpts

Tuesday 9th December 2025 Commons Chamber

[Dr Al Pinkerton (Surrey Heath) (LD)]

I beg to move,

That leave be given to bring in a Bill to place a duty on the Secretary of State to enter into negotiations with the European Union to agree a customs union between the United Kingdom and the European Union; and for connected purposes.

Up and down the country, businesses know it, the public feel it and it is time that this House found the courage to lift our whispered voices and admit it: Brexit has been an abject economic failure. It has choked business investment, shattered economic resilience, strangled trade, shrunk the economy and left every single one of us poorer. The economic benefits of Brexit were only ever illusory and a mirage—the kind of shimmering promise you see in the desert in the midday heat that lures you towards it, only to find it always agonisingly out of reach; a promise that dissipates altogether as the cool of the evening returns. Well, that chill has descended, and now we can see clearly that the promises of 2016 and the oven-ready deals of 2021 were nothing more than the lukewarm figments of political opportunists who sought, and in some cases still seek, advantage in populism, in fragmentation and in fear.

Far from “taking back control”, today our country feels more precarious than ever. We lurch from crisis to crisis, uncertain of who we are, what we stand for or whether our children will be better off tomorrow than those who came before. Far from becoming a buccaneering “global Britain”, the United Kingdom is today weaker and more isolated than at any point in our recent history. Far from lowering food and living costs or slashing regulation, British businesses are now buried under 2 billion bits of red tape that stretch 15 times around the circumference of the Earth, all while the cost of living spirals even higher. Far from securing the transformative trading arrangements they promised, the Government have delivered only Australia and New Zealand deals worth a combined 0.1% to UK GDP and exposed British farmers to tougher competition and diluted protections. The India deal would add just 0.13%, and the much-heralded US agreement has shrunk from a growth opportunity into damage limitation following Trump’s tariffs.

Meanwhile, we have erected new barriers to our largest market, the European Union, which continues to represent around half of our global trade. The result? Tiny wins at the margins and a massive permanent hit at the core. That is not “global Britain”, and nor was it ever going to be. It is economics by consolation prize, and the country is paying the price.

Just last month, the National Bureau of Economic Research, a leading US think-tank, published a decade-long analysis concluding that Brexit has reduced UK GDP by between 6% and 8%. The House of Commons Library shows that Brexit is now costing the Treasury up to £90 billion every single year in lost tax receipts—money that could be supporting our NHS, our defence spending and our public services. In practical terms, the average Briton today is between £2,700 and £3,700 worse off than if we had remained in the European Union. That is the reality of the Conservatives’ botched Brexit deal.

Let me put this plainly. The most dishonest campaign in modern British political history promised that Brexit would save £350 million a week. Instead, Brexit is now costing this country £250 million every single day—[Hon. Members: “Rubbish!”] That is why we have the highest tax burden in 70 years. That is why families face sky-high bills. That is why we remain trapped in a cost of living crisis. This is the lived reality of the very working people the Government claim to champion, but for whom they show neither the resolve nor the political will to protect. Conservative Members and Reform Members behind me may chunter, but it is the former leader of the Conservative party and Prime Minister, Sir John Major, who has noted:

“Brexit is a flop. It will not leap up from its death bed.”

The Liberal Democrats believe that the most effective route to sustainable economic growth in our country is to rebuild our relationship with the European Union, our single most important trading partner. Just last week, the Prime Minister himself said:

“The Brexit deal significantly hurt our economy…so for economic renewal we must keep reducing frictions and move towards a closer relationship with the EU.”

That view was echoed by the Deputy Prime Minister, who described a customs union as an inevitable “journey of travel”. My Bill would propel us along that journey. It proposes a UK-EU customs union covering most goods, with a formal mechanism for UK consultation on new EU trade deals that affect us. It would lift the man-made constraints that are strangling our small and medium-sized enterprises, many of which have stopped trading with Europe altogether. This Bill is on the side of British business.

The Federation of Small Businesses is clear that the greatest burdens fall on firms with the fewest resources to adapt. Crocus, one of the largest horticultural businesses in the UK based in my Surrey Heath constituency, tells me that trade barriers add friction, inflate supply chain costs and cause damaging delays at our borders. Others warn that British-developed innovations risk being lifted and relocated to the continent—British ideas nurtured by British universities lost because electoral expediency was placed above economic reality.

Even if the Government stayed within their own self-defeating red lines, which merely replicate, of course, Theresa May’s failed framework, a better deal with Europe could generate £25 billion extra per year for the Treasury. But the British public and British businesses want this Government to go further and faster. At a time when Office for National Statistics data shows rising numbers of young Britons leaving to work overseas, we have a national duty to support growth, ease household pressure and give young people a compelling reason to build their futures here in the UK.

As my party’s former Northern Ireland spokesperson, I worked across the political divide to consider the practical implications of the Windsor framework. Red lanes, green lanes, parcel movements across the Irish sea—these barriers still hamper our internal market. A bespoke customs union would cut costs, smooth trade and reduce daily frictions for businesses in Northern Ireland. Those who value the Union should see more clearly than anyone that co-operation strengthens it far more than isolation ever could.

We do not strengthen the British economy by raising barriers to the market that takes 41% of our exports. We strengthen it by removing the barriers that were created so that a weak Prime Minister could pretend to be tough. A survey by the British Chambers of Commerce shows that nearly half of exporters cite customs procedures as their biggest barrier and 39% cite documentation complexity. The message from businesses is unambiguous: reduce friction and unleash growth.

A closer economic partnership with Europe is also a matter of our national security. Russia is defined by military expansionism and destabilisation. China grows more coercive and authoritarian by the year. Under a second Trump Administration, the United States has demonstrated a willingness to threaten and coerce even its closest allies in pursuit of hemispheric pre-eminence. In its recent national security strategy, the US welcomes

“the growing influence of patriotic European parties”

and says its goal

“should be to help Europe correct its current trajectory”—

a clear signal of intent to interfere in allies’ domestic politics. In an increasingly fractious multipolar world, we must stand closest with those who share our values, our trade and our common security.

If we are serious about lifting this country out of stagnation, we must get Britain growing again, get Britain exporting again and make Britain competitive again. A bespoke UK-EU customs union would cut red tape, unlock investment and restore certainty to British business. To sit on our hands is to choose stagnation. To oppose this Bill is to prolong the cost of living crisis. To reject it is to hold back the small and medium-sized businesses that form the backbone of our economy.

Today the House has a clear choice: we can remain on a path of managed decline, or we can choose a future built on growth, confidence and opportunity. We can unleash once again the resilience, creativity and innovation of British business. I commend this Bill to the House.

[Madam Deputy Speaker (Caroline Nokes)]

I call Simon Hoare to speak for no more than 10 minutes.