Theresa May has no option but to tear up her red lines on a customs union if she wants to pass her Brexit deal, one of Jeremy Corbyn’s closest allies said today.
Shadow business secretary Rebecca Long-Bailey spoke out as both Cabinet and Labour sources confirmed cross-party talks have moved significantly in recent days, pointing to a potential deal within a fortnight.
Both sides agree there has been a change of tone this week, and that any deal is likely to be built around the principle that any future Tory or Labour government with a clear Commons majority would be free to negotiate changes.
Ms Long-Bailey made clear, however, that Mrs May will have to make a decisive shift towards Labour’s policy for a customs union. “I think, pragmatically, that they potentially may have no option in order to be able to push this deal through,” she told BBC Radio 4’s Today programme.
A Tory source said the key question was whether Mr Corbyn and shadow chancellor John McDonnell are willing to dip their hands in the blood of Brexit and risk a split with pro-EU colleagues such as shadow Brexit secretary Sir Keir Starmer and deputy leader Tom Watson.
With her own party divided, Mrs May desperately needs Labour support to get the withdrawal agreement through the Commons in time to avert the toxic political image of newly elected Brexit Party MEPs taking their seats.
In yesterday’s Cabinet, two senior members spoke in favour of making compromises for the sake of a deal with Mr Corbyn.
Environment Secretary Michael Gove, one of the leading Brexiteers in 2016, said an unpalatable outcome was better than a disastrous one in which the UK never leaves the EU. Chief Whip Julian Smith reportedly warned the Government could be sunk without Labour support.
Mrs May’s red line that the UK must be able to strike independent trade deals is a key sticking point, as Labour argues it would open the NHS to US corporations.
With trade in goods regulated through the backstop by the EU, Labour says only services would be left for free trade deals, raising the prospect of the Tories opening public bodies and procurement to competition and deregulation.
But Labour accepts any lock would be temporary, allowing a future Tory government with a clear majority to pursue more ambitious trade talks. Labour would similarly be barred from bending EU rules on state aid in the short term but could seek new rules if elected with an overall majority.
Transport Secretary Chris Grayling is reportedly cancelling all contracts for ferry services to be provided in a no-deal Brexit, at a cost of £50 million.