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The head of the UK’s trade union movement has thrown his weight behind calls for Britain to negotiate a new customs union with the EU, arguing the move would boost living standards.
Paul Nowak, general secretary of the Trades Union Congress, said Prime Minister Sir Keir Starmer should forge “the closest possible economic and political relationship 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 that we thought it always was, and so you’ve got to have the right relationship with your largest trading partner,” he told the Financial Times in an interview at the TUC’s London headquarters.
Nowak said the government should “look at every option to improve our relationship with the European Union, up to [and] including a customs union”. Such a deal would mean some or all goods could trade between the UK and EU without customs checks, though it would also restrict Britain’s ability to sign other trade deals.
At present, trade friction was not only deterring investment in the UK, but also exacerbating cost of living pressures, Nowak said. “In my mind, it’s about protecting good quality UK jobs and supply chains but it’s also about a practical impact on prices in supermarkets,” he said.
“I don’t think you need 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 is part of that, I think the public would support it.”
Nowak’s intervention adds to the pressure on Starmer to be more ambitious in his “reset” with Brussels, despite the prime minister’s insistence that a new customs union with the EU would cross a “clear red line” and cause trade deals with the US and India to unravel.
It follows comments from health secretary Wes Streeting, one of the frontrunners to be next Labour leader, who told the Observer last week that Britain had taken a “massive economic hit” from Brexit and that the best way to boost growth would be “a deeper trading relationship with the EU”.
Nowak argued that a deal on youth mobility with the EU would also win the public’s support. “If you asked ordinary working-class people in this country, do they want their kids to have the opportunity to live and work abroad, they would say, absolutely, yes.”
Nowak said the TUC had long been making the case for stronger ties with the EU, adding that “all the polling shows that whether you voted for leave or remain, people think we’ve got a bad Brexit deal at the moment”.
It should be a priority for Labour, he argued, because to fend off the electoral challenge from Nigel Farage’s Reform UK party, “we have got to do more to step up to the plate to prove that mainstream politics can deliver the positive change in people’s living standards”.
Union leaders have become increasingly critical of the Starmer administration over the past year as Reform has gained ground in the polls, clashing with the government over welfare reform in particular.
This month’s election of the leftwing candidate Andrea Egan to head Unison, the UK’s biggest public sector union, could lead to further friction, especially given government plans for tight public sector pay settlements.
For the TUC, which represents 47 member unions, the overriding priority for 2026 is to press ministers to implement new workers’ rights that passed into law earlier this month. Unions are concerned that with much of the detail of the legislation still to be decided 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 cut it,” Nowak said, adding that secondary legislation implementing new rights for workers to be offered guaranteed hours, and for unions to access workplaces, must be “absolutely watertight”.
His comments are a shot across the bows of business groups that argue that stronger protections for employees will backfire because they make it more risky and costly to hire.
Instead of giving ground to business, Nowak argued, the government should press ahead with further reforms to make sure employers cannot sidestep their new obligations by hiring freelancers instead of employees.
“What I don’t want to see is a whole raft of new employment rights, and employers are saying, ‘Don’t worry, we’ve got a way around this, which is, now you’re effectively self employed’,” he said, urging Labour to act on a commitment to review workers’ statuses.
“This, in my mind, is the key or one of the keys to winning the next election, to have an Employment Rights Act that actually is having an impact in workplaces.”