Keir Starmer's government has been told that securing a deeper trading relationship with the European Union is a "critical imperative" for British firms, as a growing number of exporters report greater difficulty to do business under the UK’s post-Brexit agreement.
Mounting Business Dissatisfaction with Current Deal
Urging the government to hasten its reset with Brussels, the leading business group stated that the UK’s existing trade and cooperation agreement was not supporting them grow their sales in the EU. More than half of exporters in a survey of almost 1,000 businesses – most of whom were small and medium-sized companies – said the trade deal enacted in 2021 was failing to assist.
“Following a budget that did not to deliver meaningful growth or trade support, securing a successful EU reset is now a business-critical need, not a matter of political preference,” said Steve Lynch.
Highlighting an ongoing economic hit from Brexit, the trade body noted this figure represented a significant rise from the proportion of dissatisfied companies in a comparable poll a year earlier. It added that just a tiny fraction of the businesses surveyed believed government support on navigating new trade rules was comprehensive.
Political Pressure for a Closer Partnership
This statement from the business group – which represents more than 50,000 firms – comes amid growing recognition within Labour’s frontbench about the damage of Brexit. Recently, a senior Labour figure became the latest top Labour politician to call for a deeper trading relationship with the EU, in remarks seen as hinting that Britain could join a customs union.
Such an arrangement would clash with Labour’s manifesto, which promised “no going back” to the EU internal market, customs bloc, or free movement. The Prime Minister has previously insisted he could not foresee any circumstances where the UK rejoined within his lifetime.
However, several pro-European ministers are believed to be among those who would prefer the administration to take more ambitious steps.
Business Proposals for the 2026 Reset
According to a document setting out a “business manifesto for the EU reset”, the business group said the government must prioritise its efforts to reduce barriers to trade for exporters to help boost the UK economy. Citing comments from annoyed businesses, it said firms were finding it ever harder to navigate changes in EU and UK laws since Brexit.
“Since Brexit our export sales have virtually stopped. The TCA has had zero effect in recovering any sales into the EU,” said one small manufacturing firm in the North West.
The BCC outlined several main recommendations for talks with Brussels in 2026, including:
- A deal to reduce inspections on animal and plant products.
- Completing connections between the UK and EU’s carbon markets.
- Establishing a youth mobility scheme.
- Securing full UK participation in the EU’s defence fund.
- Enhancing cooperation on VAT and customs simplification.
An official representative said: “We are cutting bureaucracy and obstacles to trade to support jobs, business, and growth. That’s exactly why we reset our relationship with the EU and are making significant headway in negotiations.”
