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Why Tory MPs want Rishi Sunak to redo Brexit

Rishi Sunak’s week could not have started any worse. Before jetting off to Japan for the G7 in Hiroshima, the Prime Minister took a rare break by going to see his beloved Southampton play for the first time since he entered No 10 last November.

He told friends he was delighted to be back at St Mary’s Stadium and was relieved that the nearest the crowd got to abusive chanting was a cry of “Rishi, what’s the score” from victorious Fulham fans.

But he also recounted that it was “the worst game of football I’ve ever seen” because of the defeat which doomed his team to second tier football next season.

And the jeers from away fans were soon followed by cries of protest from business leaders, who warned that the UK will be facing economic relegation unless Mr Sunak reworks the current Brexit deal.

Car manufacturing bosses have raised significant concerns about the future of their industry in this country because of new post-Brexit rules that are due to kick in next year, which risk hitting exports with a 10 per cent tariff.

Vauxhall’s parent company, Stellantis, said such an outcome could bring about the closure of its UK factories, and hammer another nail into the coffin of the British car industry

The grumblings coincided with food industry leaders warning that consumers will face higher supermarket bills as a result of onerous post-Brexit food labelling agreed by the UK Government, which the Food and Drink Federation insisted would only further fuel inflation.

Further doom and gloom is seeping out from the City, with Barclays announcing it will increase its headcount in Paris, as major banks increasingly see the French capital as Europe’s main trading hub over the coming years.

There is now a growing belief across Westminster that the Brexit deal negotiated by Boris Johnson is acting as a drag anchor on the UK economy and is in need of reshaping if the country is to continue to compete economically.

Until now, both the Conservatives and Labour have been eager to avoid the issue as they still suffer the scars of the Brexit wars. But increasingly MPs are daring to say the previously unsayable – that Britain’s relationship with the EU needs a thorough rethink.

As part of the terms agreed between the UK and Brussels, the Trade and Cooperation Agreement is up for a review in 2025 and is being viewed by many Tory and Labour MPs as an opportunity to improve terms.

One former Cabinet minister warned the UK was currently experiencing the worst of all worlds, with limited access to the EU’s markets but limited deregulation – despite the pro-Brexit stance of Mr Sunak and many key lieutenants.

They said: “You’ve got a bunch of Brexiteers who want to keep EU taxation rates and EU regulations, but without access to the single market. It’s f***ing mental.”

The apparent inertia has prompted even Nigel Farage, never one to miss an opportunity to claim Brexit betrayal, to judge the UK’s exit from the EU as a “failure”.

And the current unsatisfactory situation is emboldening those in favour of closer links with Europe to push the review mechanism, which is built into the existing deal, as an opportunity to broker better terms. Former justice secretary Sir Robert Buckland told i it was a reason why “working now to widen and improve this bilateral agreement is the right approach”.

Sir Robert insisted that such a view was now widely shared among his Tory colleagues, saying: “We have left the EU but having a successful bilateral trading relationship is what we all should want to see.”

His comments come after Tobias Ellwood told i that the country was “learning the hard way that our model of Brexit is economically sub-optimal”.

Such is the level of concern among Tories over the impact Mr Johnson’s Brexit deal is having on the economy, MPs are now lobbying Mr Sunak to do more to iron out creases in the current agreement.

In a bid to calm dissent among Conservative MPs, the Prime Minister is now in the habit of inviting 10 to 20 backbenchers to breakfast in No 10 every Tuesday.

One Conservative MP said they were privately urging him to strike side deals with Brussels on issues such as food standards and veterinary medicines, to smooth trade and avoid disruption for Northern Ireland.

They predicted the EU would be more open to negotiations than previously, saying: “Before the invasion of Ukraine they wanted to punish us for leaving and we were trying to create dividing lines, but now that’s changed.”

The shift in relations is down to more than just Ukraine, however, with senior government sources telling i that Mr Sunak has made better relations with the EU a priority since coming to power, and believes that staying on good terms with key leaders such as Ursula von der Leyen can allow the UK to make progress without having to renegotiate the existing trade deal entirely.

“It’s about going from strength to strength rather than undoing anything,” one source close to the Prime Minister told i.

He will hold further talks with French President Emmanuel Macron at the G7 on Saturday as the pair continue to enjoy a good working relationship, while chats can be expected with Ms von der Leyen on the sidelines of the summit.

Indeed, Mr Sunak is said to be relatively sanguine about the complaints from businesses over the impact of the deal, arguing privately that firms are resistant to any sort of change but will be able to adapt over time.

There is little to no appetite within government to carry out any major surgery to the Brexit agreement. The question is whether that position holds should major industries, such as car manufacturers, start upping sticks.

It is a reality that many within the Labour ranks believe is more than possible, with shadow ministers eyeing the 2025 review as a serious pivot point for potential changes, particularly if a future Labour government is to fire significant growth in the economy.

Sir Keir Starmer had Brexiteers up in arms this week when he suggested he would renegotiate the Brexit deal in light of business concerns, only for Labour aides to quickly insist it was a slip of the tongue.

Nonetheless, one Labour frontbencher suggested that at some point in the future, the UK may rejoin the European Economic Area which gives access to the single market – a controversial move because that would require the resumption of free movement of people from the EU.

The shadow minister told i that Sir Keir’s missions for government would be affected by relations with the continent, saying: “When you look at the main mission, the fastest-growing economy in the G7, it’s very difficult to do that without being in the single market.”

Another shadow minister said a reworking of the deal was inevitable. “Motor manufacturing is the sign of an advanced economy. No government of any colour would want to lose it on their watch,” the MP said.

Far from having “got Brexit done”, as Boris Johnson famously declared in 2020, the Brexit wars could be about to start over again.

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