Keir Starmer should seek out a far closer relationship with Europe, including a possible customs union, the head of the TUC has said.
Paul Nowak, TUC general secretary, said the British public recognised the need for a vastly improved trading arrangement and said it had become more urgent than ever because of the fickle nature of the relationship with Donald Trump’s United States.
In an interview with the Guardian, Nowak said Starmer must relentlessly focus on the cost of living to improve Labour’s standing in the polls, saying it was little surprise there was leadership chatter when the party was doing so badly.
But he warned would-be challengers they would “not be thanked” by the public for distracting the government from its core focus on the economy.
He also cautioned Starmer and the home secretary Shabana Mahmood not to be “Nigel Farage-lite” when it came to the migration crackdown, saying trade unions were worried about reforms to indefinite leave to remain.
Nowak’s new year’s message urged the government to do all it could to help ordinary families, with new polling showing four in five households say their financial circumstances are either stagnant or getting worse.
The union chief said a customs union with the EU should be explored as a way of growing the economy.
“The government needs to do whatever it can to build the closest possible positive working relationship with Europe economically and politically as well … up to and including the customs union,” he said.
“I think that’s been reinforced by the events of the past 12 months where Trump and the White House have proven the US is not the predictable ally we’ve always depended on.”
Nowak, 53, said he did not believe there was a significant number of voters who still remained opposed to closer trading ties with Europe – but said it should go beyond electoral considerations.
“Whether you voted for Brexit or not, people recognise we’ve got a botched Brexit deal,” he said. “They can see the impact of that bad Brexit deal on things like prices in supermarkets.”
Nowak, who took over the leadership of the TUC in 2022, has been a strong supporter of Starmer in the past, despite condemning the government’s winter fuel cuts and welfare reforms, mostly now reversed.
But he gave only cautious backing to the prime minister, with Starmer’s position likely to come under further pressure after next year’s crunch May elections.
“He is the man doing the job at the moment,” Nowak said. “When I go around and talk to groups of union reps in workplaces … they are not obsessed about who is the prime minister or who is up or who is down.”
Unions have recently elected leaders who are sceptical of the current Labour administration, despite low turnouts.
Two of the biggest unions are now led by Starmer critics, Sharon Graham at Unite and the newly elected Andrea Egan at Unison, who was expelled from the Labour party in 2022.
Nowak declines to pass comment on what that might mean for relations with trade unions. But, he said, unions should feel able to call out a Labour government.
“There’s always going to be points of tension and we can’t agree on everything,” he said.
“I think people got frustrated that sometimes it looked like the hard choices were falling on those who could least afford them. This year they just have to be clear … show how you are making a difference to people’s standard of living.”
He said he was pleased to see Labour U-turn before the budget on plans for an income tax rise. “It’s not just the sharp end of the labour market who are feeling the pinch, it’s right across those low- and middle-income earners.”
Nowak said he was unsurprised that there was speculation about Starmer’s leadership. One of his likely challengers would be Angela Rayner, who has close union ties, especially with Unison, and who steered the employment rights bill before she was forced to resign earlier this year.
“When the prime minister personally is doing badly in polls, you’re never going to be able to avoid that [leadership speculation],” Nowak said.
“I just don’t think it’s useful for me to do fantasy politics. We’re dealing with the realities of what we’ve got right now.”
He said Starmer had an opportunity this year to deliver tangible differences to how people felt about the cost of living, saying if he did so it would “look fundamentally different in the polls”.
But he warned leadership hopefuls not to get distracted by politics. “Frankly, the public will not thank you for parliamentary manoeuvrings and political shenanigans when the big job at hand isn’t being delivered.”
Nowak said that he remained extremely concerned about the rise of Reform UK – despite acknowledging many trade union members were likely to be supporters of Nigel Farage’s party. But he said the normalisation of racist language was having a devastating impact on some minorities.
“I was in County Durham a couple of months ago, and met a black woman social worker who’d been in the country for 20 years. She talked about her experience of being afraid to walk out on the streets because she is being racially abused,” he said.
“What we’ve done is legitimise language that frankly five, 10 years ago we would think was unacceptable. If it walks like a racist and quacks like a racist, it probably is racist.”
Nowak said he acknowledged there was widespread concern about high levels of immigration – and said unions would be prepared to back fair-minded reforms. But he cautioned they would have a major effect on public services – and that he was deeply concerned about the proposed change to make people wait 10 years for indefinite leave to remain.
“It has real-world consequences for people working in care homes, on our railways and on our buses and in our prisons, that you’re going to end up losing people that we desperately need,” he said.
“Both my grandfathers came to this country during the second world war and the idea that if you come to the UK, then within two and a half years someone could assess that you need to go back? It’s really difficult … we’ve made this point to the government.”
The TUC and most trade unions are ending the year in a celebratory mood, with the passing of the Employment Rights Act after months of delay in the Lords. But Nowak said there were significant steps still to be taken to enact the whole of Labour’s Make Work Pay package promised in the manifesto.
He said it was crucial that the end to zero-hours contracts was implemented “with real bite” so the onus was on employers to offer fixed hours. And he said the government should press ahead with its consultation on defining a single status of worker to end bogus self-employment.
“Bad employers can be incredibly innovative when it comes to insecure forms of employment,” he said.
But Nowak said he was most heartened by the passing of the new measures that made it easier for unions to organise in workplaces. “It’s the first time in my 35 years of being a trade union activist and official that any government’s ever repealed anti-union legislation,” he said.
For the first time, he expected union membership to rise over the coming years. “I think what this does is move us away from being a minority sport to the mainstream of British workplaces,” he said.
Nowak said he also wanted to see the government shout louder about its leftwing credentials, from the employment rights bill, to nationalisation, to the end of the two-child benefit gaps.
But he also said progressives who were disillusioned with Labour should engage more, showing what pressure could achieve. “I think we’ve got to make this the best possible Labour government that we can,” he said.
“I don’t think, in my job, or anybody who’s really interested in progressive politics, you can treat politics as a spectator sport. It’s not our job to carp from the sidelines, it’s to try to engage the government and lobby them.”
