Brussels ‘to beef up free market protections’ over Jeremy Corbyn government fears

Posted On: 
7th May 2018

The EU is reportedly launching a fresh drive to shore up its free market policies after Brexit amid fears that Jeremy Corbyn’s plans could undermine European firms.

The Labour leader's plans for subisidies and nationalisations are reportedly worrying top Brussels officials.

The Times cites senior Brussels officials who are said to be pushing for a hard-line “level playing field mechanism” in a future trade deal with the UK because they are concerned that the Labour leader’s nationalisation programme and subsidy promises will make it harder to compete.

“The idea that Conservatives would legislate a race to the bottom is a myth and no one really believes it, even if some Tories have helped create it,” an EU source told the paper.

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“The real fear is state subsidies under a Jeremy Corbyn government.”

According to the paper, the bloc is concerned that Britain under Labour would provide generous subsidies to manufacturers that could give them an unfair advantage in trade with the EU, while there are fears that nationalised utilities firms could out-compete foreign rivals.

Officials are said to be drawing up a so-called “non-regression” clause designed to entrench free-market policies in the UK’s exit deal.

The warnings come amid an ongoing Labour row over the European Economic Area, with MPs breaking ranks over the weekend to attack the party leadership over an “incredible” decision to order Labour peers to abstain on an attempt to keep the UK in the free trading bloc.

More than 40 Labour peers are expected to defy Mr Corbyn later this week by backing a cross-party Lords amendment tabled by Lord Waheed Alli, which would seek to leave open the so-called “Norway option” by asking ministers to negotiate British membership of the EEA.