LABOUR have been forced to deny a report that they plan to re-enter the customs union if they win the General Election.

It comes after a paper from political consultancy Eurasia Group cited “senior Labour insiders” as saying the party would seek to revive a high-alignment deal in a bid to boost economic growth, according to the Financial Times.

One of the unnamed insiders reportedly said: “[That] deal is a first-term ambition. A de facto customs union by another name. It is the first step of where we’d want to get to.”

They added that they were reflecting new internal thinking on the EU within the Labour leadership.

They then said if the party won an October election with a sizable majority then leader Keir Starmer would jet off to Brussels – within weeks potentially – to signal his desire for a “fundamental upgrade” of the EU-UK relationship.

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But Labour has denied the briefing that was sent to Eurasia Group clients on Monday, insisting the party was sticking to staying outside the single market and customs union.

It comes after Starmer rowed back on a pledge to renegotiate the Brexit deal last month.

Nick Thomas-Symonds, a Labour shadow cabinet office minister, said: “Labour has long been clear that we are committed to making Brexit work.

"We have set out clear red lines on the future of our relationship with the European Union: no return to the single market, the customs union, or return to freedom of movement.”

The SNP has said the denial proves Starmer “has no desire to represent the people of Scotland” as Labour ploughs on with its refusal to accept the “economic vandalism” of Brexit.

Alyn Smith, the SNP’s Europe spokesperson at Westminster, said: “Poll after poll shows that the people of Scotland want to rejoin the EU and the world's largest single market at the earliest opportunity – after being dragged out by Westminster against their will. 

"And yet despite this, Sir Keir Starmer has confirmed that an incoming Labour government will remain focused on preserving the Tories' failed Brexit Britain economic model – signalling once again that the views of the Scottish people mean nothing to him. 

“Starmer's refusal to accept the economic vandalism of Brexit will continue to hammer households and businesses in Scotland.”

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Last September, Starmer criticised the Brexit deal reached by Boris Johnson’s Tory government, claiming: “Almost everyone recognises [it] is not a good deal – it’s far too thin.”

He then pledged to renegotiate with the EU should he lead the UK government in 2025, with a review of the Brexit deal due the following year.

Starmer told the Financial Times: “As we go into 2025 we will attempt to get a much better deal for the UK.”

But reports have since suggested the party has U-turned on that commitment.

The Telegraph reported that the Labour leader had “quietly dropped his ambition to secure a major overhaul of the pact when it comes up for review”.

Quoting sources from the EU side of negotiations, that paper said that Labour had “accepted in recent talks that a major renegotiation would not take place”.