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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 finding it tougher to operate under the UK’s post-Brexit agreement.

Growing Business Dissatisfaction with Post-Brexit Arrangements

Calling on Labour to accelerate its reset with Brussels, the British Chambers of Commerce stated that the UK’s current TCA was not supporting them increase exports in the EU. Over 50% of exporters in a poll of nearly one thousand firms – most of whom were SME 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, getting the EU reset right is now a business-critical need, not a matter of political preference,” said the BCC’s director of international trade.

Pointing to a continuing economic cost from Brexit, the trade body noted this figure represented a 13 percentage point increase from the proportion of unhappy firms in a similar survey a year earlier. It added that just a tiny fraction of the businesses surveyed believed government support on trade policy changes was comprehensive.

Political Pressure for a Closer Partnership

This statement from the business group – which speaks for tens of thousands of companies – comes amid increasing awareness within the government's senior ranks about the economic impact of leaving the EU. Recently, a senior Labour figure became the latest top Labour politician to advocate for closer economic ties with the EU, in remarks interpreted as a suggestion that Britain could join a customs union.

This kind of proposal would clash with Labour’s manifesto, which promised “no going back” to the EU single market, customs union, or freedom of movement. Starmer has also stated in the past he could not foresee a situation where the UK re-entered the EU in his lifetime.

Nevertheless, several pro-European ministers are believed to be among those who would prefer the administration to take more ambitious steps.

Business Proposals for the EU Negotiations

In a report 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 support growth in the UK economy. Citing comments from annoyed businesses, it said firms were finding it increasingly difficult to navigate changes in EU and UK laws since Brexit.

“Our overseas sales since leaving the EU have all but ceased. 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.
• Creating a youth mobility scheme.
• Securing full UK participation in the EU’s defence fund.
• Improving collaboration on VAT and customs simplification.

An official representative said: “This government is cutting bureaucracy and trade barriers to support jobs, business, and growth. That’s exactly why we renewed our partnership with the EU and are making strong progress in negotiations.”