Jeremy Corbyn faces a new push from both Labour’s left and right wings to make the party adopt a more pro-European stance.
A left-wing group backed by key Corbyn supporters has produced a report calling for the party to ditch Brexit and instead “remain and reform” in the EU.
It followed another report from the Progress think tank, which has backing from MPs on the party’s right, setting out how tackling concern around immigration would allow Labour to commit to staying in the EU’s single market.
One Labour backbencher told The Independent that now the party had committed to a customs union, pushing for it to also accept the single market was achievable.
The new drive emerged when the left-wing Another Europe is Possible group produced a document called “The Corbyn Moment and European Socialism”, which says the Labour leader can far better achieve his goals inside the EU.
It argues that the right to free movement has been “poorly understood” and that concern about companies employing large numbers of cheaper European workers are now being addressed by new EU “anti-undercutting” rules.
The report then points to recent moves from some EU figures to water down a proposed Europe-wide financial transaction tax (FTT), a European policy backed by Mr Corbyn.
It reads: “British support for this policy under Labour could break the logjam and open up its rapid EU-wide introduction.
“This would be especially important in the context of the current uncertainty surrounding the FTT.
We’ve got the party to commit to shift position towards a customs union, now we need the single market
“One negative consequence of Brexit is that it has created increased scope and incentive for ‘beggar-thy-neighbour’ policies, risking a race to the bottom in regulation and tax as financial centres such as Paris and Frankfurt scramble to capture business from London.”
The report has the backing of Manuel Cortes, general secretary of the Transport Salaried Staffs’ Association, who called on the left to “join forces” and prevent Brexit undermining workers’ rights, while Labour MEP Julie Ward said a Corbyn-led Labour government could successfully push the EU from the inside.
There is no suggestion that they had input into the EU report however, and a spokesman for Mr McDonnell told The Independent he had not seen it.
A spokesman for Mr Corbyn’s office said: “We respect the result of the referendum and have laid out plans for a ‘jobs first’ Brexit.”
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Two days earlier Progress, the philosophical home of the party’s right, also published an editorial focussing on continued membership of the single market.
In an article in its monthly magazine it listed 10 ways Britain could better control its borders that would fit with Labour values, “deal with the public’s concerns and keep us in the single market”.
It included measures like counting all migrants in and out of the country, a worker registration system and a Belgium-style “no job, no stay” approach.
Director and the article’s author Richard Angell urged the party to consider the list, saying: “It is socialist to take a lead, it is right to engage the public and, if it is done correctly, it could keep Britain in the single market.”
It comes on the back of the launch of the Labour Campaign for the Single Market, which calls for a dedicated policy commission on Brexit so that members and supporters can influence the party’s position.
Despite having a membership that is broadly pro-European, Labour has had to walk a careful line on Brexit because many of its northern seats heavily backed leaving the EU over concerns related to immigration.
But one senior Labour MP told The Independent that the time had come to revisit the debate, pointing to seats like Wakefield where ex-shadow cabinet minister Mary Creagh had increased her vote by almost 6,000 votes in 2017, despite voting against triggering Article 50.
The MP said: “We’ve got the party to commit to shift position towards a customs union, now we need the single market. The main block to that is the issue around freedom of movement.
“There was a time when the debate on that seemed insurmountable, but that is changing and we need a new discussion on it.”