You might remember that a few weeks ago we told you about the Charles Kennedy Memorial Lecture organised by the European Movement.

Nick Clegg talked about the path to closer alignment with the European Movement.

You can watch his speech courtesy of the European Movement’s You Tube channel.

The text is below:

We are here in part to remember a much-missed friend and colleague, Charles Kennedy. It has been just over a decade since Charles passed, and we are all the poorer for it. He was one of the lights of liberalism in this country, and his absence in public life is felt in many ways – not least with regard to Europe, the cause with which he was so indelibly linked, and to which I wish to dedicate this lecture.

In 2015, Charles said that “the next few years in politics will come down to a tale of two Unions – the UK and the EU”. Typically prophetic, although sadly the melodrama has already consumed more than just a few years.

As we look back on an extraordinary and turbid time in our history, it is clear that we have endured a lost decade, and that we cannot afford to lose another. Now – ten years since the Brexit vote – is a good time to decide what we want the next decade to be.

After all, a decade is a long time. Ten years ago, Barack Obama was the President, Chat GPT wasn’t invented, and Leicester City were Premier League champions. It is a natural point at which to take stock; one of those psychological markers we use to reflect about our lives. I always thought ten years since the Brexit referendum would be a very important inflection point in our national conversation about what country we want to be.

It’s a long time not just in politics or life, but in the life of a country. Think of the opportunity cost of letting ten years go by as we lurched from one madcap post-Brexit Conservative Government to the next, none of whom appeared to have a clue what role Britain should play in the world; and now continue to drift under a somewhat hapless Labour Government as the world changes utterly around us. Think of all the seeds that weren’t planted, the ideas that didn’t get off the ground, the lives and decisions that were put on hold while we moped around in an aimless post-Brexit funk. It’s hard to count all that up, but it matters.

It was a decade, importantly, in which the victors had their chance to show what they were going to do with their narrow referendum triumph. And on every count it is clear they have failed. Not because Brexit wasn’t done properly – the ludicrous whinge from Farage et al – because they had arch Brexiteers in government every step of the way and got everything they wanted. On the back of a very slender mandate they imposed the hardest of hard Brexits – something no one asked for nor was promised in the referendum – and look what it got us: a decade of lost growth. A decade where things have become harder, not easier, for a lot of people in Britain; where our status in the world has shrunk, not grown; where we are less in control of our own destiny, not more.

This has arguably been the most costly decade of economic and political mismanagement and mendacity suffered by any economy across the developed world in the whole post war period.

With that in mind, I want to make the following points today:

First, that time and events have cast the error of Brexit in sharp relief. The world today is scarcely recognizable from that in which decisions about leaving the EU were made. We have lost rather than gained sovereignty, and squandered a critical decade.

Second, that by burning down the post-war international order, Trump and Putin have dispensed with some of the polite fictions that have hamstrung decision-making here and in Europe, and may have done us a grim favour by letting us see things as they really are.

Third, that despite the politically-motivated omerta around Brexit, the economic, technological and geopolitical logic now clearly point in one direction: closer co-operation across the Channel, and a much more ambitious pivot to Europe, with the obvious destination being full reunion.

And last, that – having been gifted a moment of strategic clarity – what we are missing is urgency: for genuine reform in Europe, for ambition in the UK, and for concrete steps to build a new relationship equal to the challenges ahead.

It can’t come soon enough, for the damage Brexit has done to the economic health of the UK is impossible to ignore.

The recent NBER study put the overall hit attributed to Brexit at 6%-8% of GDP – significantly worse than the 4% that was famously bandied about by the OBR.

That is about the same impact as the other great economic shock of the century – the 2008 financial crisis. It is a vast sum, likely in the region of a trillion pounds by the end of the decade, and represents a permanent reduction in output. We are not getting that growth back. Every inch we gain now is from a lower base, and will be hard won.

Brexit materially damaged our position as an investment and trading nation. Exports and imports will be around 15% lower in the long run. More than 16,000 businesses stopped exporting to the EU altogether. Private sector investment is down 12%; productivity 3%.

So as predicted, Brexit made Britain poorer. What was sneeringly characterised as elitist hand-wringing has held up rather better than the snake oil guff the Leave campaign was peddling. There is a real cost to that, one that the country has borne and will continue to bear. It is the gaping economic hole beneath the waterline.

The precariousness of our economic position is all the more unnerving given the speed and scale of the geopolitical unravelling around us. Assumptions that have shaped British policy for a lifetime are dissolving beneath our feet, and we find ourselves more isolated and less influential than any time I can remember.

Most significant is the shattering of the transatlantic alliance. Britain and the US have disagreed on policy before. But this is something different. The Trump administration is now actively hostile to the values that most of us hold dear; explicitly meddling in domestic politics across Europe to empower the far-right, and wielding its economic power to extract value from erstwhile allies. If we had to pick now, today, would we really tie ourselves to the land of tariffs, Trump, Hegseth and Musk?

It is tempting to imagine that the current cast of characters will leave, the tide will turn, and all will be well with the world again. Anglo-American relations have been central to our security and identity for so long that we would be forgiven the seductive daydream: that things will return to semi-normality, that we can slip back into the comforting assumptions that have governed our national posture since Suez.

I think that is a dangerous misreading – not just of the mood, but of the deeper shifts in US politics and the American psyche. I listened to JD Vance cast withering scorn on Europe’s democracies in Munich last year. Then came the US National Security Strategy, a statement of outright ideological hostility. Then came the threats to Greenland, and a panicked force deployment to protect European territory from an American threat. And now the war in Iran, the depredations and recriminations amongst supposed allies, and Trump’s open contempt for NATO.

I am afraid it’s not just Trump, and this is not a blip. The trend both precedes and will outlive his Presidency: there is an established constituency for expansionist great-power bellicosity in American politics. Clearly America’s vaunted constitutional checks and balances struggle to constrain a presidency in the face of a supine Congress. Clearly, too, the benefits of the post-war order that America helped build have been discounted or forgotten by a hegemon that appears increasingly drunk on its own power. These things are not going away, not overnight, perhaps not at all. And while America remains the proverbial 900lb gorilla in the room, the risks to those who relied on US post war leadership are profound.
So the dilemma gripping European capitals is if anything most acute in London: how to rapidly unwind our dependence on an ally we no longer recognise. After all, even if a more predictable President took office next time, the risk will always be hovering in the background. We have seen how far and how fast American political culture can shift. How certain can we be that the next few nominees will share our basic view of the world, let alone look out for our national interest? Can we really afford to bet our future on a few thousand voters in a Midwestern swing state every four years?

Our worries to the West are more troubling given the threat from the East. Putin’s Russia is 4 years into a land war in Europe; it has carried out missile strikes 10 miles from the Polish border, sent ships into British waters, poisoned people on British soil. Four years into a bloody invasion of Ukraine, there is little sign that his appetite for war is diminishing. Should the unthinkable happen and Putin prevail in Ukraine, does anyone think he would stop there?

In the face of these threats, the future of NATO – until so recently the bedrock of British security policy – is less certain than ever. Can we really trust Article 5 to keep us safe? Enough to bet our freedom and security on it? Europe is scrambling to marshal a historic defence spending effort as it seeks to make up lost time and secure the means to defend itself without America, and all the while Xi Jingping watches gleefully from Beijing as events consolidate China’s growing supremacy in the new world order.

A might-is-right world where hegemons carve up hemispheres of influence is plainly perilous for small countries without deep alliances of their own. Yet this is the backdrop against which Britain decided to go it alone. And so we are adrift in a dangerous world – not a bridge across the Atlantic, but alone in a hostile sea.

Other great currents have shifted beneath us, too. Alongside economic and geopolitical ruptures, this has been a decade of profound technological change.
Self-driving cars. Starlink. LLMs: none of these existed in summer 2016. Back then, most Britons probably hadn’t heard of Nvidia. Today it is worth more than our annual GDP. 7 US tech companies spend the equivalent of the UK’s annual defence budget on AI every six weeks.

We are in the midst of a scramble for supremacy in Artificial Intelligence. America sees dominance in frontier models as existential; China is spreading its open-source technology; Europe is racing to catch-up. And on the battlefield AI is suddenly everywhere: Cheap military drones swarm overhead in Ukraine and alter the balance of power in the Gulf; the Pentagon plans operations with AI assistants. A decade ago, fields strewn with fibre-optic cables and soldiers evacuated by unmanned robotic vehicles would seem like scenes from a sci-fi film.

Yet in this global race, Britain role remains less than it should be. Despite our many strengths – from our research base and history of innovation to our vibrant start up tech economy – most AI labs, models and products come from outside the UK. The industrial revolution gave Britain a multi-generational headstart that fuelled two centuries of success. If AI turns out to be even a tenth as impactful, are we set up to get the best of it, when we are still erecting barriers to people, ideas, and funds? In part because of decisions taken in Westminster and Whitehall, the reality is that no one in their right mind would try to train a cutting edge large language model model in the UK today. If we are in the midst of an AI industrial revolution, we barely have a single steam engine we can call our own.
In technology, as in the economy more broadly, the point is that the world is already dramatically different to 2016, and the bet we made before – that we could stand astride the Atlantic, charting our own path between two superpowers, sovereign without being dependent – seems less and less credible with every passing day.

Clearly, Brexit was not only a triumph of mendacity by the Brexiteers, and an appeal to a nostalgic yesteryear which no longer exists, it was also an act of terrible timing. Overestimating and mischaracterising our strength, Brexiteers took a punt on a nebulous conception of sovereignty just as the cost of going solo rose dramatically due to forces we could not control. Events proved the
thesis unworkable, and the country has been left exposed. The EU moved on, America turned its back, and Britain has far less influence with either than we did a decade ago.

And yet, exactly at the point when we needed politicians prepared to call out the gravity of our predicament, there has been a dismal tendency on both the right and the left to avert their gaze from reality:

The left has obsessed over the last decade and a half about fiscal policy as the be all and end all of our economic fortunes when any GCSE economics student can see that the massive shocks of the banking crisis of 2008 and the referendum of 2016 have done far more grievous damage to the British economy than any of the fiscal adjustments which had to be made in response to both. (Covid, and the Ukraine and Iran wars have only compounded the damage and have impacted many countries too – but our overreliance on the City of London made 2008 especially damaging to Britain, and Brexit was a uniquely self inflicted wound).

Indeed, much though they like to forget it, the Labour Government introduced legislation in the Spring of 2010 to reduce the deficit more quickly than the subsequent Coalition Government did between 2010-2015. Fetishizing public spending was always a political choice from the Left that exempted them from their own culpability and blinded them to the enormity of the damage wrought by Brexit.
Meanwhile, the right has quietly hoped no one would notice that they imposed this calamity on Britain in the first place – on a platform of rage and nostalgia which has left the country more vulnerable than at any time in generations. So much for their patriotism.

Europe, of course, has its troubles too: massive spending challenges and energy costs, an ageing population, chronic political feebleness and inertia in the face of change. One of the many tragedies of Brexit was the sense that not only were we
wilfully excluding ourselves from a club where decisions that affect us are made but that this would be bad for Europe too, even if it was worse for us.
As a European by background and inclination I remain, like many, deeply frustrated by the continent’s persistent unwillingness to grasp some of its thorniest issues, its knee-jerk preference for regulation over dynamism, its habit of acting decisively only when disaster strikes. In technology, for example, there is a tendency to try to clip the wings of others’ companies rather than create opportunities for their own, with the result that far too many Europeans with big ideas take them elsewhere.

There is foot-dragging even on the plainly urgent: it’s been over a year since the Draghi report made almost 400 recommendations for improving Europe’s competitiveness; by some counts just 1 in 10 have been acted upon, and as Draghi himself said recently, each of the challenges he set out have only got worse. Everyone knows reforms are needed, but the inability to get them done on any reasonable timetable feeds the endemic lack of confidence that plagues the EU. It’s a problem Britain shares – our publics are ahead of our politics on the big issues, which only breeds further dissatisfaction.

The irony is that when Europe does get its act together it can be a force for a great deal of good. It is the target of MAGA’s ire precisely because it stands for values of mutual cooperation which nationalists abhor. My fear is that if its weaknesses are not checked, and it doesn’t act coherently to assert its strategic position, the EU will confirm the allegations of feebleness directed at it by its MAGA critics: its institutions ending up resembling something like the UN: paper bureaucracies not really linked to anything real. And that will leave the continent prey to increasingly predatory powers on all sides.

Yet for all its flaws, Europe has shown once again that – when faced with a crisis – it can act to shore up its position in a hostile world. Witness the flurry of post-“liberation day” trade agreements – with Indonesia, India, MERCOSUR, and Australia – all signed after the tariff shock, creating a market of more than 2 billion people and a quarter of global GDP. Against a current of zero-sum mercantilism, Europe is building a bulwark: a rules-based trade coalition, with the EU as the anchor.

The belated realisation that the continent must bear more of the burden of its own defence has seen a similar torrent of initiatives: the ReArm Europe Readiness 2030 plan and 150 billion euros of loans for defence procurement; Security and Defence partnerships with the UK, Canada, India, Iceland, Norway, Australia and Ghana; and of course, the hopefully soon-to-be-delivered €90bn Ukraine loan. The commitment is real: Europe provides the lion’s share of aid to Ukraine; since 2021, nominal EU country defence spending has risen by roughly 60%; the only members of NATO to exceed the 3.5% goal are European.

Like its geopolitical rivals, the EU is also expanding its territorial footprint – but by invitation and persuasion, not extortion and war. Half a dozen countries are now looking at EU accession, with varying levels of seriousness: Iceland, Norway, Moldova, Montenegro, Albania, and Ukraine – with the latter 3 completing checkpoints in record time. It is illuminating to consider the injection of resources, creativity and energy that a growing European Union stands to gain from potential new members; and sobering to think some of them may well be at Europe’s top table before we have a chance to retake our seat.

On technology, too, there is evidence that Europe is starting finally to become more than the sum of its parts. European VC investment has quadrupled in a decade, outstripping China’s; tech talent is now as likely to move from America to Europe as the other way round. Europe is funding AI gigafactories for training and operating frontier AI. Completing the digital single market and 28th regime process for continent-wide company registration will further boost a tech sector already worth nearly $4 trillion.

To my mind, then, the economic, technological and geopolitical logic now point in one direction: a much more ambitious pivot to our European hinterland.

People understand this of course. The polling on Brexit is clear: most people think it was a mistake and have done for years, and voters across all main parties want a closer relationship with the EU. But it is equally clear that overhauling our shattered relationship with Europe cannot be about rehearsing the same old dreadful arguments again. People feel a profound aversion to having another fight about it, and understandably so. There is real scar tissue there – this divided friendships and families in a way quite unlike anything else I can remember. And there is a very British quality to the response: we’ve made our bed, and now we must lie in it.

But fatalism, like hope, is not a strategy. A stiff upper lip goes a long way, but in life there are some things you really can’t duck just because they’re uncomfortable. We ought to be grown-up enough to speak directly to the British public and say: look, it’s been ten years; we gave it a shot, it didn’t work out. Now the only sensible thing to do is to stop digging, move on, and try something new. The question is not about the merits of the decision we took a decade ago. It is: “what do you think will be best for your kids, and your grandkids, a decade from now?”

Unsurprisingly I am in favour of a much fuller rapprochement with the EU. That is the best way to strengthen our sovereignty, position in the world and prospects for the future. And it would end the ludicrous situation where it seems a majority of the population, politicians and businesses agree Brexit is a disaster, but we’re all just grimly pushing on as if our hands are tied.

For the UK, joining the customs union alone as a first step would likely add 1-2% of GDP, and would start to pare back the tsunami wave of Brexit red tape which has suffocated our exporters (of all the false claims from Brexiteers the assertion they were against red tape was perhaps the most cynical – they have instead been the harbingers of vast reams of it).

Single Market membership would be of far greater economic value – not least since it would cover services which are particularly important to our national prosperity – but it would be foolish not to recognise the very real problems in joining the Single Market whilst not being a member of the EU itself: it would represent a marked loss of political, regulatory and legislative authority over our own affairs as rules would be set by others over which we have no control. No wonder Norwegians call that status “fax democracy”. And no wonder they appear to be deciding that joining the EU in full is the logical step, the better to protect their own sovereignty. And that is why I have never advocated Single Market membership for the UK as a stand-alone approach: it can only ever be seen as a stepping stone back to full EU membership.

For Europe, a closer relationship with the UK promises deeper access to our expertise in defence, aerospace and tech – including AI, quantum, drones and more – where we can have outsize impact; more opportunities to leverage the UK’s strong academic and research base; reintegration of our highly developed financial markets. It would at a stroke expand the EU’s GDP and internal market and provide an immediate economic and competitive boost – not to mention adding another nuclear power and permanent seat on the UN Security Council.

For these reasons and many more, I believe we would all be better off if the UK was fully at the heart of Europe again: a new relationship, with a new Europe, for a new world. It will take time, and trust, and political will – resources that are in short supply. But we should spell out now that that is our end destination, so that we can start the journey today.

What then might this new relationship look like?

First, there is plenty we can do to get momentum going before getting bogged down in the legalistic process of reaccession into the EU. Second, it should be focused on co-operation on the most important issues where time is of the essence. And third, it should be rooted in a broader understanding of what it means to be part of the European project at a time of galloping deglobalization and big power politics.
Europe’s political structures, regulatory power, currency, and policies have different footprints and remits. This is a strength, not a weakness, as it vastly extends the reach of European power beyond the strictures of the acquis communautaire. And there is a growing recognition currently that the EU is going to have to avail itself more of new provisions that allow different countries to provide different things across its priorities, including defence, technology and the economy. A culture built on rules must get comfortable with looser affiliations in the service of common goals, lest its rigidity be its demise.

Faced with endless delays in completing the single market, there is a push to start with a smaller core group to accelerate integration; a similar approach was mooted to deal with Orban’s intransigence on aid to Ukraine. There are calls to widen the single market to include the Western Balkans, Ukraine and Moldova, pre-accession, as part of a broader strategic investment in Europe’s security and prosperity. The recently renewed Swiss-EU deal shows it is possible to stitch together treaties and governance arrangements that add up to a close relationship with a non-EEA state.

In other words, the “all in or all out” straitjacket of EU membership is giving way to something more supple and multifaceted in which different constellations of countries can work together on different issues. Obviously the core competences of the EU will remain at the heart of it all, but the outlines of a “Eurovision” model of European integration – involving a wider array of countries across the European hemisphere – is starting to heave into view.

One obvious way for the UK to kick things off is through a new EU defence & security arrangement, which will be both an extrapolation of and add-on to existing treaties. There are a number of ideas bubbling up: one is an intergovernmental security treaty to lay the groundwork for European common defence, following the Schengen agreement model; built to be as close to EU structures as possible, and ready to fully incorporate into the EU at a later date. This could include Ukraine, Canada, Norway and Iceland as well as the UK, and would involve building the scaffolding for common defence policy, including the creation of a European Security Council on which signatories could serve. Much groundwork has been laid through the necessary co-operation on Ukraine, including through the Coalition of the Willing, which Britain played a crucial and laudable role in creating.

We can make immediate progress on technology, too: closer co-operation on high-performance computing for AI, and a broader push to bring our complementary strengths together to build a hemispheric tech sector that reflects the depth of talent and opportunities in our corner of the world. London was the undisputed capital of financial markets before we left the EU and has been diminished since. Reintegrating its fintech system with Europe’s startup scene could make it one of the central hubs of a wider European tech space embracing the EU, UK, and Ukraine – making the most of London’s enduring role as a home of people, ideas and capital.
Other pragmatic efforts should focus on areas where co-operation is most needed, easiest to achieve, or will yield the fastest results. The Government is inching towards agreements with the EU linking emissions trading schemes and integrating the UK into the EU internal electricity market, and recently announced an agreement on UK’s participation in Erasmus +. The TCA agreement review coming up in 2026 provides an opportunity to clear a few more thornbushes, and better see the path to full reunion.

The ultimate objective – of reintegrating the UK into the EU in full – should go hand in hand with the most consequential of the other enlargements in the years to come: Ukraine. There is a live debate in EU capitals right now about whether Ukraine should be asked to jump through all the hoops before any membership status is granted, or whether associate membership – safeguarding both Ukraine’s and the EU’s security interests from Russian predation – can be a first step, with conditional steps in the following years culminating in full membership.

This same logic holds for a British reunion too. Whilst this may not yet be evident to either country, in truth Ukraine and the UK are yoked together in their respective journeys back into the heart of Europe. Surely it is unthinkable that, after all the sweat and treasure Britain has expended to defend its independence, Ukraine should join the EU without us sitting at the top table alongside them? Many British voters – whatever their views at the time of the Brexit referendum – will surely now recognise the overwhelming merit of joining Ukraine in a significantly altered European Union.

That being the case, it seems to me that we can set a compelling objective now: namely, that our national mission will be for the United Kingdom to rejoin the European Union alongside Ukraine and others by 2036, the 20 year anniversary of the Brexit vote. To meet that goal a decade from today, the argument needs to be made more forcefully by pro Europeans in all parties today: and as Sadiq Kahn and others have suggested, that will need to include a clear commitment to EU membership in party manifestos at the next election. Ten years may seem like a long time, but in truth it is a relatively short period in which to turn things round.

Of course there are real barriers to overcome, not least of which the fact that even if the UK was wholly in favour of rejoining the EU tomorrow, 27 other countries would also have a say, and our reputation for reliability has taken something of a hit during this decade-long moment of madness. As the partner that walked out, we have to do rather more of the work if we want to give the relationship another try.
And we badly need to inject a sense of urgency – here, and in Europe’s other capitals too. Of all the resources we have, time is perhaps the most precious: it is finite and irreversible, the one thing you never have enough of – and can never get more of. I have seen how slowly the wheels of the state can grind: as an EU official, as an MEP, and a member of a government that got quite a lot done, it still felt painfully slow at times. I have also seen the frenetic, almost crazed pace at which Silicon Valley operates, where projects are measured in hours of engineering time.

So I recognise the uneasy sensation amongst many critical observers of our battered old continent who see an astounding lack of urgency amongst the UK elite about rebuilding bridges, symptomatic of a ruling class asleep at the wheel. During a decade in which the American century ended – and the peace dividend with it – we still didn’t put the pedal to the floor. Our lack of urgency at a time when so many other countries have recognized that the world has changed utterly is an error that further compounds the strategic error of Brexit itself. The only remedy is not to repeat the mistake: we cannot allow the hurt of the debate of 10 years ago to stall us from moving forward for the next 10 years.

The path to undoing the immense damage of Brexit means recognizing that this isn’t about re-hashing the arguments that got us here. It isn’t about rejoining the EU as it was ten years ago, or even as it currently stands. And it isn’t about continuing to muddle on in no man’s land while the liberal order disintegrates around us.
It’s about summoning the will to imagine something better and the clarity of purpose to get it done. If Charles was still with us today, I know he would be itching to help lead this cause; to raise our sights, and look for opportunities not enemies in Europe; so that when the next decade rolls around, we can look the next generation in the eye and say that in the face of momentous change, we had the courage and the conviction to build something new: a new relationship, with a new Europe, for a new world. Of that, I am sure, Charles would be proud.