IN BUDGET WEEK, the focus inevitably falls on the Chancellor of the Exchequer, writes Jonathan Edwards.
While Rachel Reeves is by far the most important political figure in UK politics when it comes to the economy, Torfaen MP Nick Thomas-Symonds will be a pivotal figure if Labour is to achieve its ambitions.
This is not because Thomas-Symonds has the title of Paymaster General. When I looked at the UK government’s website, I saw that that specific role had no responsibility. He has, however, been given the gigantic job of Minister for EU Relations, specifically to reset the fractured relationship following Brexit.
Following a meeting with his EU counterpart Maros Sefcovic, Thomas-Symonds said:
“Our Government is committed to resetting the relationship with the European Union, to strengthen ties, reinforce our security and tackle barriers to trade.”
The key bit is the last three words.
Brexit has been an unmitigated economic disaster. The latest Office for Budget Responsibility forecasts published in March estimated the year-on-year hit at 4% of GDP. My maths puts that in a range of between £150bn and £110bn lost in economic value every year. Exports and imports had fallen by 15%, and all the trade deals signed by the last UK Government had no impact as they effectively re-signed deals previously negotiated by the EU.
The basics of this are that living standards have stagnated, inflationary pressures have been more acute on goods and services, and tax receipts available for the Treasury are less than what they should have been, impacting the money available for investment in public services.
If we needed reminding of the extra trade barriers caused by Brexit, this week, the FPC (Fresh Produce Consortium) and the HTA (Horticultural Trade Association) wrote a joint letter to the Chancellor complaining that new import checks were leading to significant delays and increased costs by up to 10% (inevitably passed onto consumers).
The joint letter reads:
“This situation has led to reduced consumer choice, strained business relationships, tarnished the UK’s business reputation, diminished confidence in border processes, compromised food security, and setbacks in achieving our environmental targets.”
To give a practical example, I was speaking to my local florist the other day in Tycroes. She said that, whereas she was guaranteed daily delivery before Brexit, she now had no idea when her produce order would arrive. Most flowers we see in the UK are imported from Holland, making the planning of her business nearly impossible.
Labour will be judged not only on whether it can return economic growth to some semblance of normality but also, critically, on whether people feel better off. We are early in this Parliament; however, the political calendar proceeds at rapid speed, and the Senedd and Scottish Parliament elections are 18 months away.
Some (including myself) have called for the UK to fully reintegrate with the European Union economic frameworks since the signing of the final Brexit deal (Trade and Cooperation Agreement). That’s partly because, following the 2016 Referendum, my position was that the only acceptable Brexit kept the UK within the EU Single Market and Customs Union.
I am not convinced how practical that position is in reality. Obviously, it takes a certain degree of exceptionalism to believe that the EU is just going to say: “Yes, please come back, let bygones be bygones.”
The UK has little goodwill in the bank in Brussels and European capitals; it is will have to rebuild trust.
A key date to watch for is the full review of the current Trade and Cooperation Agreement, which is due to be finalised in January 2026.
If Thomas-Symonds can achieve his objective of minimising trade barriers, it would provide the foundation for Labour’s next UK election campaign, as it would inevitably boost economic performance. Strategically, it would also start creating the foundations that would enable a second-term Labour Government to take the UK back to where it belongs, to the heart of Europe.
A lot rests on the shoulders of the MP for Torfaen.
