Labour should acknowledge that no deal is better than a bad deal
It’s time to stop being naive. Keir Starmer signed two bad deals this week, and I’m not surprised: when Labour negotiates, Britain loses. Instead of a comprehensive free trade agreement with the United States, we’ve got a tiny tariff deal. It’s better than nothing, but not by much, especially when we’ve cut our tariffs by three times more than the US.
What surprised me was how many rushed to proclaim these deals as Brexit benefits without examining the details. It’s a fact that without Brexit, we wouldn’t be in the room, negotiating with India or the US. But the true Brexit benefit is taking control of our trade policy to sign good deals, not just any deals.
No deal is better than a bad deal. Unfortunately, all we’ve had with Labour are bad deals. From handing inflation-busting pay rises to trade unions with no conditions, to surrendering the Chagos Islands to Mauritius and paying to do so, Keir Starmer believes that niceties seal agreements, yet he consistently gets taken to the cleaners.
Many do not understand why the US deal is so disappointing. What we witnessed was the spectacle of Starmer staring at a phone as President Trump lauded a deal that keeps 10 per cent tariffs on UK goods, while we slash them on American goods.
From day one as leader of the opposition, I challenged the prime minister to revive the draft free trade deal agreed with Trump when he was last in office. While President Biden refused to do any deal with the UK, Trump was eager to enhance our trading relationship with our biggest export market. Instead, this Labour government has signed a tiny tariff deal that fails to improve our terms with America, not even matching where we were in March!
As a bare minimum, Starmer could have leveraged Trump’s affinity for Britain to return tariffs on cars and steel to below 5 per cent. But once again, the prime minister capitulated, and the prospects for a robust US trade deal now seem more distant than ever.
As trade secretary, my objective was always to stand firm and prioritise Britain’s interests over a quick headline. It’s why I signed the UK into the CPTPP [the Comprehensive and Progressive Agreement for Trans-Pacific Partnership] — our biggest trade deal since Brexit, a free trade agreement with the Asia-Pacific that opens new opportunities for British businesses with countries from Australia to Mexico. But when Canada wouldn’t drop demands to allow hormone-fed beef into the UK, I didn’t hesitate to break off negotiations.
No deal is better than a bad deal.
When I joined the India trade deal talks nine months in, India hadn’t done many trade deals, and those they had were largely symbolic. I wanted a good deal. For nearly two years, I pressed India to open their economy to UK goods and services in exchange for the same. But every time progress seemed possible, the terms changed unfavourably, including requesting a two-tier tax arrangement that works well with countries like the US or Switzerland but was too lopsided given the large number of Indian workers coming to the UK and only a few going the other way. I refused to sign. No deal is better than a bad deal.
So when the Indian prime minister, Narendra Modi, announced a UK-India trade deal, my first thought was, “what has Starmer given up now?” The government tried to obscure a two-tier tax arrangement, while the Indians claimed it as an “unprecedented victory”.
Now, companies can cut costs by importing Indian workers exempt from Rachel Reeves’s jobs tax. Yet this capitulation isn’t the main issue. The real problem is what doesn’t seem to be included.
I pushed for an investment treaty to protect UK firms from arbitrary decisions, where retrospective taxes and expropriation of successful companies — as happened to Vodafone in India — are not repeated. There’s no sign of that in the deal. Nor is there anything on legal services, digital services or intellectual property protections. The Law Society and British pharmaceuticals industry have since criticised the lack of ambition.
While the Indians are shrewd negotiators, focused on their national interest, our Foreign Office was more interested in new chapters on gender equality for Indian workers than getting economic benefits. I went to business for the best ideas. But Starmer is getting the wrong advice, and our prime minister has been outplayed again.
No deal is better than a bad deal. These deals last for decades and shape future trade negotiations. Having let India and Trump walk all over him in a single week, Starmer is poised to start our EU “reset”. I’m worried, and you should be too.
