Andy Burnham's 'big gamble' to put London back at heart of Europe after Brexit blunder

Andy Burnham faces a “big gamble” to reverse the damage of Brexit inflicted on London, says a leading expert.

“It would be a big gamble, but he seems to be someone who is willing to take risks. So I think there's a chance,” he told The Standard.

Andy Burnham at Labour’s conference in Liverpool

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Mr Grant told how the benefits for London, and the wider UK, of going back into the Single Market, or similar ties with the EU, would likely include:

“ An “economic boom” boosting tax revenues for the Treasury as the economy grows quickly and this in turn could lead to tax cuts for millions of people and businesses

* A return of some of the bankers, including from US banks, who were part of a Brexit “exodus” from the City to other financial centres

* A jump in investment into London and other regions

More European workers would return to London to work in coffee shops and other businesses if the UK rejoined the Single Market

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* A new “buzz” in London as more European workers head to the city

* Coffee shops and other businesses finding it easier to recruit staff

* Billions more in Government coffers to spend on improving public services such as schools and hospitals

* Britain regaining political clout on the global stage

Mayor of London Lord Sadiq Khan

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Mr Grant explained how Britain’s GDP had taken a hit of between 5% and 8% from Brexit.

“That means everybody is paying more tax. There's less money for public spending,” he said.

“If you rejoin the European Union, there'll be an economic boom.”

Specifically on the City, he told how there had been a “bit of an exodus” due to Brexit, particularly linked to European trades, but not on the scale as feared.

“Quite a lot of American investment banks shifted people from London to Paris, Amsterdam, Dublin, Frankfurt and other European financial centres,” he said.

“So some of those jobs would probably come back.”

The City would benefit from a return to the Single Market

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Rejoining the Customs Union would benefit the North and the Midlands, he explained, as it would boost trade in manufactured and other goods.

But the far bigger economic prize would be a return to the Single Market, for example through a Norway-style model, which is likely to include a return to freedom of movement of workers.

However, this would also probably mean Britain having to be a rule taker, accepting directives from Brussels with limited or no say over them.

Such an arrangement would be politically difficult to persuade the country to adopt.

But the Government is already seeking to rebuild ties with the European bloc, including through a youth mobility scheme which could help London’s coffee shops and other business recruit workers.

A move to rejoin the Single Market would significantly increase this labour force.

Mr Grant added: “It'll be more of a buzz in London because probably more people coming in from EU countries.”

The City of London Corporation backed Mr Burnham’s move towards closer EU ties, stressing the need for a greater focus on regulatory cooperation and market access including mutual recognition of professional qualifications, extending adequacy arrangements, and bringing down barriers to investment in defence, tech and net-zero.