UK-EU Relations: Starmer's 'Reset' Faces Hurdles Amid Red Lines

Soon after he was elected in 2024, Starmer promised a “reset” of the UK’s ties with the rest of Europe, hoping to draw a line under years of fractious relations with the 27-member bloc and secure a range of new economic and other deals with Britain’s largest trading partner.

A year later, the prime minister said a wide-ranging agreement signed at a feelgood UK-EU summit in London “gives us unprecedented access to the EU market, the best of any country”, and would deliver “cheaper food and energy” for British people.

After Labour’s local election drubbing this month, Starmer again promised his government would be “defined by rebuilding our relationship with Europe, by putting Britain at the heart of Europe”. But concrete progress so far has been at best limited.

The UK has rejoined the EU’s Horizon science programme – although that was agreed under the previous government – and will rejoin the Erasmus+ programme for educational and training exchanges from 2027, at least for a year.

But in other areas, talks are tricky. Negotiations over a “youth mobility scheme” to allow young Britons to live and work in EU countries and young EU citizens to live and work in the UK for a period are bogged down over the issue of tuition fees for EU students.

UK integration into Europe’s electricity market has been held up by London’s refusal to pay into EU “cohesion funds” in exchange, while a deal to allow the UK to join the SAFE defence procurement fund also fell through over the financial contribution demanded by Brussels.

London has said that by the next UK-EU summit this summer, it hoped to have sealed deals on food and agricultural products, carbon emissions trading, and the youth mobility (or, as the UK calls it, “youth experience”) scheme. But none of this is gamechanging.

What is standing in the way of closer ties?

The main obstacles to any significant improvement in UK-EU ties lie in the “red lines” that Starmer’s Labour government laid down before it was elected: no return to the customs union, no return to the single market, and no return to freedom of movement.

While some member states complain that the European Commission could be more creative and flexible in negotiating bespoke deals with Britain, the bloc’s overriding view is that the closer the UK wants to get to the EU, the more it must align with EU rules and regulations.

Any government moves in that direction – such as planned new legislation allowing the UK to dynamically align with EU single market rules without a normal parliamentary vote – has been savaged by Reform UK and the Conservatives as “undoing Brexit by the back door”.

Most economists agree the kind of sectorial mini-deals the UK has so far sought from the EU will not have much of an impact on the UK economy and are certainly unlikely to recover the estimated 6%-8% hit to economic output caused by Brexit by the first quarter of 2025.

In his speech after the local elections, Starmer said: “Incremental change won’t cut it … We need a bigger response than we anticipated in 2024 because these are not ordinary times.” But in terms of UK-EU ties, no “bigger response” is possible unless those red lines are eased.

Any more far-reaching agreement that may make a significant economic difference – on joining the single market, for example – would involve allowing EU citizens the freedom to work and live in the UK, which the government has so far refused to contemplate.

How would the EU welcome a bigger reset – or even a request to rejoin?

The world of 2026 is not the same as that of 2016, when the UK voted to leave the EU. Russia is waging war on Ukraine. The UK-US “special relationship” has been severely shaken. The rules-based international order is in danger, maybe in terminal decline.

Analysts say the EU and UK would both benefit significantly from a fundamental rethink of their relationship that would enhance their security and prosperity.

A YouGov poll last month suggested 63% of Britons want a closer relationship with the EU, while 55% want to rejoin – something the EU has always said it would welcome. Support for the UK’s return is at or above 50% in Germany, France, Spain, Italy and elsewhere.

But Europeans would also overwhelmingly expect the UK to get the same terms as any new member. As Poland’s foreign minister, Radosław Sikorski, put it, Britain would not get the same opt-outs it had before, or its rebate. The EU may also insist on Britain joining the euro.

Sikorski also said the UK had yet to “internalise the fundamental European deal”: that closer ties, in the form of customs union, single market or full membership, came at the price of “pooling some aspects of sovereignty” and “honouring rules you didn’t make yourself”.

European leaders would be concerned about a future Reform UK government undoing any deal, and could demand clauses imposing a penalty if that was attempted. But today’s geostrategic realities mean any UK bid to rejoin would, at the very least, be seriously entertained.