Starmer ‘bending knee’ to Brussels as EU looks to undo Brexit with ‘disgraceful’ Customs Union deal

PEM operates under common rules which enable parts, ingredients and materials for manufacturing supply chains to be sourced from across dozens of countries in Europe and North Africa tariff-free.

The suggestion, rejected by the previous Tory Governments, was touted during Sefcovic’s appearance at the World Economic Forum in Davos.

The Prime Minister is unequioval about his determination to “reset” cross-Channel relations but continues to insist that this will not infringe on the UK’s decision to leave the Single Market or Customs Union.

Responding to Sefcovic's comments, Shadow Foreign Secretary Dame Priti Patel said: “Labour's programme of bending the knee to the EU is disgraceful.

“These latest reports that the Government might shackle us to the European Union are deeply concerning, and once again make clear that Keir Starmer and his chums are all too happy to put their ideology ahead of our national interest, no matter the cost.

“The Conservatives will always fight for the democratic freedoms the British public voted for, and will not stand idly by in the face of Labour's great betrayal of our country.”

Starmer’s Government is reportedly holding consultations with business leaders over the benefits of PEM but no final decision has yet been made.

• Jenrick's 'cynical' call for Attorney General 'conflict of interest' investigation REJECTED
• Rayner under-fire after dismissing Southport terror connection as Farage demands 'fake news' apology
• EU's top Brexit negotiator claims bloc should 'consider' UK joining tariff-free customs scheme

Brexiteers have long warned that being part of a Customs Union would block the UK from signing independent Free Trade Agreements, including with the United States.

However, Liberal Democrat leader Sir Ed Davey is already publicly calling for an official return to the Customs Union.

Davey, who is expected to call for the UK to rejoin the EU later down the line, argued it was needed to boost Britain's economy and its ability to deal with the incoming Donald Trump presidency from a position of strength.

Sefcovic's suggestion, rejected by the previous Tory Governments, was touted during his appearance at the World Economic Forum in Davos.

The Brussels bureaucrat said the idea has not been "precisely formulated" by London yet and the "ball is in the UK's court".

Sefcovic also hinted at a full-scale veterinary agreement to reduce frictions on farming and food trade, an updating fisheries deal and mobility plan for under 30s.

Sefcovic said it was hoped the scheme would "build bridges for the future for the European Union and the UK".

"That was the idea," he said. "[But] we've been a little bit surprised what kind of spin it got in the UK.

"It is not freedom of movement," Sefcovic added. "We have been very clear what we've been proposing."

Despite rejecting previous calls for a return of Freedom of Movement, Starmer could face pressure next month while attending a defence and security focused EU summit.

The Prime Minister is determined to “reset” cross-Channel relations but continues to insist that this will not infringe on the UK’s decision to leave the Single Market or Customs Union.

And No10 has since left the door open to accepting Sefcovic's PEM offer.

A Downing Street spokesman said: "The arrangement that’s been discussed is not a Customs Union.

"Our red line has always been that we will never join a Single Market, Freedom of Movement, but we’re just not going to get ahead of those discussions."

However, MPs have already been exerting pressure on Starmer over under 30s being engaged in a free movement arrangement.

A 10-minute rule bill, introduced by Liberal Democrat MP James McCleary, will receive its second reading on July 25.