Union leader backs calls for UK-EU customs union

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Britain’s trade union leader has backed calls for Britain to negotiate a new customs union with the EU, arguing the move would improve living standards.

Paul Nowakgeneral secretary of the Trades Union Congress, said Prime Minister Sir Keir Starmer should forge “the closest possible economic and political relations with Europe”, partly for geopolitical reasons but also to make life more affordable for workers.

“The last 12 months have proven that the White House is not the reliable ally we thought it always was, and so you need to have a good relationship with your biggest trading partner,” he told the Financial Times in an interview at the TUC headquarters in London.

Nowak said the government should “examine all options to improve our relationship with the European Union, until [and] including a customs union”. Such an agreement would mean that some or all goods could be traded between the UK and EU without customs checks, but it would also restrict Britain’s ability to sign other trade deals.

Currently, trade frictions are not only deterring investment in the UK, but are also exacerbating cost of living pressures, Nowak said. “In my mind it’s about protecting good quality jobs and supply chains in the UK, but it’s also about a practical impact on prices in supermarkets,” he said.

“I don’t think it’s necessary to wait for the next election,” he added. “I think what the British public want is action on living standards and action on the cost of living. And if a better Brexit deal was part of that, I think the public would support it.”

Nowak’s intervention adds to the pressure on Starmer to be more ambitious in its “reset” with Brussels, despite the Prime Minister’s insistence that a new customs union with the EU would cross a “clear red line” and lead to the breakdown of trade deals with the US and India.

It follows comments from Health Secretary Wes Streeting, one of the favorites to become the next Labor leader, who last week told the Observer that Britain had suffered a “massive economic blow” from Brexit and that the best way to boost growth would be “a deeper trading relationship with the EU”.

Nowak argued that a youth mobility deal with the EU would also win public support. “If you asked ordinary working class people in this country if they would like their children to have the opportunity to live and work abroad, they would say absolutely yes. »

Nowak said the TUC had long advocated for stronger ties with the EU, adding that “all the polls show that whether you voted for Brexit or for Remain, people think we have a bad Brexit deal at the moment.”

This should be a priority for Labour, he argued, because to fend off the electoral challenge from Nigel Farage’s Reform UK party, “we need to do more to prove that mainstream politics can deliver positive change in people’s living standards”.

Union leaders have become increasingly critical of the Starmer government over the past year as Reform gained ground in the polls, notably clashing with the government over welfare reform.

This month election Left-wing candidate Andrea Egan’s bid to lead Unison, the UK’s largest public sector union, could lead to further friction, particularly given the government’s plans to tighten public sector pay deals.

For the TUC, which represents 47 member unions, the top priority for 2026 is to put pressure on ministers to implement new workers’ rights which were signed into law earlier this month. Unions fear that while much of the details of the legislation still need to be worked out in regulations, business groups will fight a rearguard action to delay or dilute key measures.

“A Diet Coke version of the Employment Rights Act will not be enough,” Nowak said, adding that secondary legislation implementing new rights for workers to be offered guaranteed hours and for unions to have access to workplaces must be “absolutely watertight.”

His comments run counter to business groups who argue that stronger protections for employees will backfire because they make hiring riskier and more expensive.

Instead of ceding ground to businesses, Nowak argued, the government should pursue reforms to ensure that employers cannot circumvent their new obligations by hiring freelancers instead of employees.

“What I don’t want to see is a whole bunch of new employment rights, and employers saying, ‘Don’t worry, we have a way around this, which is now you’re effectively self-employed,'” he said, urging Labor to follow through on its pledge to review workers’ status.

“That is, in my opinion, the key, or one of the keys to winning the next election, to have an employment rights law that actually impacts workplaces.”