Many believe realignment with the EU is imperative for the Britain to improve its economy.
While there are various estimates of the extent of damage caused by Brexit, there is no dispute that it increased paperwork and costs for British businesses, and diminished trade between the UK and its biggest trading partner.
According to Britain's National Institute of Economic and Social Research, since Brexit the size of the British economy has reduced by 2%-3% and the impact is expected to rise to 5%-6% by 2035.
A Cambridge Econometrics study commissioned by London Mayor Sadiq Khan, also a Labour politician, found that by 2035 Brexit will have reduced investment in the UK by a third and resulted in 3 million fewer jobs.
According to accountancy firm Menzies, one in five British businesses want the new government to return to the single market. The British Chambers of Commerce claimed that two thirds of British firms which traded with the EU last year found the processes cumbersome, and almost half disagreed that the Brexit deal had helped them grow. On the contrary, 41% said the deal made it difficult to buy and sell goods with EU member countries.
"Leaving the EU has made it more expensive and bureaucratic to sell our goods and services across the Channel," Shevaun Haviland, director general of the British Chambers of Commerce, said at the annual conference of the lobbying group which represents thousands of British businesses. "We must stop walking on eggshells and start saying it how it is."
But going by palpable sensitivities in the British public over freedom of movement and the oversight of the European Court of Justice, Starmer is unlikely to be adventurous and will aim for low-hanging fruit.
Anand Menon, professor of European politics at King's College London and director of UK in a Changing Europe, a think tank, said there will be "no major overhaul'' of the existing relationship. "He wants very little," he said of Starmer.
What does Starmer want, and what can he get?
The Labour Party seeks improvement to the EU–UK Trade and Cooperation Agreement signed by former Prime Minister Boris Johnson in late 2020. Among the relatively uncontroversial changes it seeks is a veterinary deal to reduce paperwork and border checks on animal products and mutual recognition of professional qualifications.
Labour's manifesto also calls for a new UK-EU defense pact, with an eye on collective security but also on the European Defence Fund. "If the UK concludes a broader defense and security agreement with the EU, full participation in EU defense-procurement initiatives, such as the European Defence Fund, could also be unlocked," said a recent paper from the Tony Blair Institute for Global Change.
Not everyone believes Brussels will agree. "On the economic side of defense,'' said Menon, "I am not sure the EU is going to play ball."
Furthermore, the Tory government was already in the crosshairs with Brussels last year when it tried to sign bilateral deals on youth mobility with select European countries. This past April, the European Commission protested against differential treatment of Europeans and offered its own version of a youth mobility program.
The EU suggested that young people between the ages of 18 to 30 could "travel, work and live in the UK, with reciprocity for young UK nationals in a Member State" for up to four years. It said the EU would be open to discussing the UK's return to Erasmus+ — a scheme that has offered student exchanges and apprenticeships to the youth since the late 1980s. However, it pointed out that the "current UK government has not expressed an interest in rejoining."
The conservative government of Prime Minster Rishi Sunak rejected the proposal at the time, and Labour didn't disagree. London Mayor Khan has said he will push for the youth mobility program between the UK and EU, and Starmer has said he will look into visa-free travel for musicians and artists from the UK to EU.