Jeremy Corbyn will clarify his Brexit policy on Monday with a speech that increases the chances of Theresa May being defeated in the House of Commons while apparently ruling Labour out of committing itself to full membership of the single market after EU withdrawal.

The Labour leader will confirm that his party wants the UK to remain in a customs union with the EU for good, a move that the shadow Brexit secretary, Sir Keir Starmer, described as heralding “crunch time” for the prime minister. May now faces an uphill battle to avoid being defeated on this issue by an alliance of Labour, the other opposition parties and Conservative rebels in a key vote in the spring.

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Corbyn will disappoint those in his party trying to persuade him to commit wholesale to keeping the UK in the EU single market by suggesting that remaining on current terms could stop Labour delivering its “ambitious economic programme”.

Speaking in Coventry, Corbyn will say Labour wants a bespoke relationship with the single market after Brexit that includes “protections, clarifications or exemptions” intended to ensure that EU law does not obstruct a future Labour government.

Corbyn’s comments, which appear to rule out the UK adopting the straightforward “Norway model” of single market membership by retaining membership of the European Economic Area (EEA) or joining the European Free Trade Association (Efta), were released hours after more than 80 senior Labour figures used an open statement given to the Observer to argue that staying in the single market would be the best way of minimising the economic damage of Brexit.

According to extracts released by his office in advance, Corbyn will say: “Every country that is geographically close to the EU without being an EU member state, whether it’s Turkey, Switzerland, or Norway, has some sort of close relationship to the EU, some more advantageous than others.

“Britain will need a bespoke relationship of its own. Labour would negotiate a new and strong relationship with the single market that includes full tariff-free access and a floor under existing rights, standards and protections. That new relationship would need to ensure we can deliver our ambitious economic programme.



“So we would also seek to negotiate protections, clarifications or exemptions, where necessary, in relation to privatisation and public service competition directives, state aid and procurement rules and the posted workers directive.

“We cannot be held back, inside or outside the EU, from taking the steps we need to support cutting-edge industries and local business, stop the tide of privatisation and outsourcing or prevent employers being able to import cheap agency labour from abroad to undercut existing pay and conditions.”

Labour’s pro-Europeans were encouraged to hear Starmer use an interview with Andrew Marr on Sunday to confirm that Labour was effectively committed to the UK staying in the EU customs union.

Starmer said the party wanted the UK to have “a” customs union with the EU after Brexit, rather than to remain in “the” customs union, but he also said this distinction was merely technical and that in practice the effect would be the same.

The Brexit secretary, David Davis, said Corbyn’s planned new approach would breach Labour’s manifesto promises and would stop the UK signing its own trade deals.

In an article for the Daily Telegraph he wrote: “Labour may think they have stumbled across a simple solution to Brexit, but there is a lesson they are yet to learn: if it looks like snake oil, and it smells like snake oil, don’t expect it to make you feel better.”

Speaking on BBC Radio 4’s Today programme, the energy minister Claire Perry said: “We cannot be in the customs union and secure the trade deals that we need. So while we’ll get on with Brexit, Labour can do its Brexit hokey cokey, whatever they think they need to do today. It lets down the people that voted for them.”

The shadow international trade secretary, Barry Gardiner, said the intention was to avoid an external customs union of the sort struck by Turkey, where it had to accept EU regulations.

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“The problem with the Turkish model is that asymmetry,” he told Today. “What we don’t want is for the European Union, let’s say, to be able to negotiate a deal with America, on our behalf, that was beneficial to the countries in the EU but not beneficial for us in terms of liberalising our markets to some of the things we don’t want from America.

“It’s very simple. We don’t want to be taking the rules from Europe, we want to be co-creating those rules in terms of the third-party arrangements we have with other counties.”

Gardiner said single market membership was not feasible, because it would make the UK subject to the rules but no longer around the table when those rules were created.

Labour has been firming up its support for remaining in a customs union for some time, but the formal confirmation that it is party policy opens the door to the opposition supporting amendments to legislation, forcing the government to adopt it. A key one is an amendment to the trade bill, new clause 5 (NC5), which has already been signed by eight Tory MPs.

Starmer effectively confirmed Labour would vote for NC5, saying it was “essentially saying the same thing” as what his party wanted.

“Crunch time is now coming for the prime minister, because the majority of parliament does not back her approach to a customs union and the majority in parliament needs to be heard and it will be heard sooner rather than later,” he said.

Corbyn, who is more Eurosceptic than the majority of his MPs and party members, and who was accused of campaigning against Brexit with only limited enthusiasm, did not mention the customs unions in the speech extracts released overnight. His aides did not dispute Starmer’s account of the new party policy, but they said Corbyn would address the topic with “more nuance” in his speech and stressed that there were different types of customs union.

Asked for examples of how EU law could stop a future Labour government implementing its policies, aides cited the way state aid rules have stopped the government subsidising the local steel industry in some cases, public service competition directives obliging countries to expose state-run postal services to competition, and the “posted workers” directive, which allows firms to bring in staff from other EU countries and pay them below the going rate.