MPs have demanded that Rachel Reeves “respect” the Brexit referendum and stop “dragging us ever closer to the EU”.
She said “negotiations” between Britain and the EU will start in the new year following today’s visit to Brussels to “rebuild bonds of trust that have been fractured”.
Ms Reeves became the first Chancellor to attend a meeting of European counterparts since Brexit as part of Sir Keir Starmer’s “reset” with Brussels.
Reform MP Rupert Lowe said: “Since Labour came to power we have heard constant talk of a reset with the EU and ever closer ties.
“This comes not even five years since we officially left the EU and for Brexiteers like myself, the alarm bells should be ringing.
“It’s becoming clearer by the day that this so-called “reset” is nothing more than a ploy to drag us closer to the EU.
“Labour is still filled with europhiles who would love nothing more than to see us back in the European Union.”
He added: “Rachel Reeves needs to respect the decision taken by the British people in 2016 and focus on growing the British economy, not dragging us ever closer to the EU.”
Ms Reeves said it was “in our national interest” to have more trading relations with the bloc.
She said that improving trade ties with the EU could boost the economy and drive up living standards.
But Shadow business secretary Andrew Griffith suggested Ms Reeves should look to Donald Trump, rather than the EU, for trade growth.
He said: “If she is interested in growth, she should tell the Prime Minister to jump on a plane to the US and talk to Trump about getting a US-UK trade deal done, not trying to take Britain backwards into the slow-growth EU.”
Meanwhile Alex Burghart MP, Shadow Chancellor of the Duchy of Lancaster, warned it looked like Labour’s “plan is to follow EU rules for nothing in return”.
He added: “If the Chancellor wants to improve growth and trade, she should learn the lesson that clobbering businesses with high taxes and unleashing borrowing sprees will make our country less attractive, not more.”
The government has repeatedly criticised the Brexit deal signed off by Boris Johnson but has ruled out any return to the single market or customs union.
Ms Reeves said the chance of Britain re-joining the EU customs union and single market remains a “red line” it will not cross when asked if the Government needs to be more ambitious in its reset of relations with the bloc.
She told the news conference she wants “a more business-like relationship between the EU and the UK”.
Asked whether the UK would be willing to give up some of its sovereignty to have a closer relationship with the EU and what her demands were in terms of defence cooperation, the Chancellor said: “I did not come here today to start a negotiation or to lay down a set of demands. Those conversations about the reset and those negotiations will begin in the new year.”
She added: “We got a mandate at the election in July to grow our economy and we also included in that manifesto a number of red lines in terms of our relationship with the European Union: no return to the single market, the customs union or free movement of labour.
“Those red lines remain, but subject to those we want to build closer trade relationships, but also defence and security co-operation with our neighbours and trading partners in the European Union, because it is in our collective national interest to do so.”
German finance minister Jorg Kukies said it was a “good signal” that the Chancellor was visiting Brussels but suggested there were limits to what could be achieved within the Government’s red lines of not rejoining the single market or customs union.
He said: “It’s a good signal that there is this dialogue now and that there are these ideas.
“But of course, the new British Government has made commitments to the British electorate and I don’t think it would be appropriate for us to call those into question, because those are part of the electoral platform on which it was elected.”
