UK business sends warning over another Brexit referendum

Britain’s largest business lobby group has warned against holding another referendum on Brexit, saying its members have no appetite to rejoin a customs union with the European Union.

Rain Newton-Smith, Director-General of the Confederation of British Industry, told the Financial Times that 10 years after the 2016 referendum the business community did not want to revisit the vote, despite acknowledging the economic damage caused by leaving the bloc.

She said the evidence that Brexit had created costs for business was “compelling and indisputable”, but that firms were not “looking to relitigate the referendum”.

She added that none of the business leaders she spoke to wanted to reopen the debate.

Newton-Smith’s comments draw a clear line between the business community and political leaders in Labour, the Liberal Democrats and the Greens, who have called for a closer relationship with Brussels than the one set out under Prime Minister Keir Starmer’s “reset”.

Andy Burnham, the frontrunner to succeed Starmer as Labour leader, has indicated he would seek to rejoin the EU at a future date.

Liberal Democrat Leader Ed Davey used a speech last week to demand Burnham move closer to Europe if he became prime minister, including rejoining the single market and a customs union.

Committee tells ministers to get off the fence

The comments follows a report by the House of Commons Business and Trade Committee, published on Monday (22 June), which urged ministers to “get off the fence” and set out where they want Britain’s relationship with the EU to sit by the end of this Parliament.

The cross-party committee concluded that the reset, launched at a Lancaster House summit on 19 May 2025, had so far delivered limited impact.

It found that delivery of the reset measures would add just 0.5% to UK GDP by 2040, against an estimated 4% long-term reduction from leaving the EU.

Liam Byrne, Chair of the Committee, said business could not invest in political signalling alone and needed clear rules, a clear destination and a credible vision.

The committee said only one of six core commitments under the Common Understanding had been agreed, the UK’s association to the Erasmus+ student exchange programme at a cost of £570 million for the 2027/2028 academic year.

It also noted that talks on UK participation in an EU defence procurement scheme collapsed in November 2025, and that the UK faced the highest electricity prices in the G7 as an electricity trading deal stalled.

Single market ‘not a silver bullet’

Newton-Smith said the Starmer government had focused on closer regulatory alignment with Brussels in key industrial sectors, but warned the strategy carried risks.

Asked about the potential benefits of rejoining the single market, she said business needed to be consulted closely on the pros and cons of readopting EU regulation.

She described the single market as the obvious route to alignment but said alignment was not a “silver bullet”, making sense only where clearly in the UK’s economic interest.

Now read: Ministers told to “get off the fence” on Britain’s EU future