Author Archives: Chuka Umunna

Chuka Umunna MP writes…Lib Dems are the only party committed to stopping Brexit and tackling the causes of Brexit

As the Conservative leadership contest draws to a close, with both Boris Johnson and Jeremy Hunt putting fresh paint on the impossible red lines set out by the Leave campaign, the threat of a a No Deal Brexit is closer than ever.

Both candidates are disregarding all the facts about the disastrous consequences this would have for the UK, with Boris Johnson even searching for ways to suspend Parliament to circumvent MPs to run down the clock to exit day.

Such a move would not only be a democratic outrage, but herald one of the most destructive acts of self harm on the UK ever willingly committed by our government. 

On Thursday, the Office for Budget Responsibility published its fiscal risks report. Commissioned in 2015, the report sets out to analyse the risks to public finances over the short to medium term. 

This year, the OBR devoted an entire chapter to assessing the risk of a No Deal Brexit to the UK’s finances and the findings were jaw-dropping.

Here are just 10 things the OBR warns would happen under Boris Johnson’s No Deal Brexit scenario:

1) The UK would enter a “year-long recession” at the end of 2019, with real GDP immediately falling by 2.1%.

2) The value of the pound would depreciate by 10% immediately, and remain low until at least 2024.

3) Business investment would drop due to trade costs, economic uncertainty and loss of some export markets.

4) Residential Investment and consumer spending would fall as real household income is squeezed.

5) Productivity growth would become even weaker, and remain below current projections until 2024. 

6) The growth in earnings would slow even further and remain so for the first few years.

7) Real wages would become “significantly lower”, by as much as 2.5% by 2024 compared to the last forecast.

8) Borrowing would be around £30bn a year higher from 2020-21 onwards due to tax receipts falling. This means no fiscal headroom at all for any of the tax and spend promises of Boris Johnson or Jeremy Hunt, or to allow the government to end austerity.

9) The overall impact of a No Deal Brexit and then trading on WTO rules would be a hit to GDP of 5.9%.

10) If a No Deal, WTO Brexit was combined with a stricter immigration policy for EU citizens, this hit to GDP would rise substantially, potentially as high as 9% according to the Government’s own figures.

On top of this, Brexit has already resulted in a weak pound, which has lost 17% of its value against the dollar since the 2016 vote; higher inflation; big falls in manufacturing output, construction, and business investment; and we have not even left the EU yet. 

Posted in Op-eds | Tagged , , and | 19 Comments
Advert



Recent Comments

  • User AvatarGeoffrey Payne 4th Jul - 7:54pm
    Our liberal sister parties in the US and Canada can do it, so should we.
  • User AvatarPeter 4th Jul - 7:22pm
    “Stick to the path for net zero…” This is a fantasy objective and is not achievable for reasons discussed many times. It would ruin our...
  • User AvatarDavid Raw 4th Jul - 7:20pm
    "What student politics ?" The 'defunding' the police, cutting the price of sugar and alcohol type of student politics ........... leading to a better world...
  • User AvatarAlex Macfie 4th Jul - 6:58pm
    John O: What student politics?
  • User AvatarJohn O 4th Jul - 6:31pm
    ' whereas a post-Coalition leader can honestly say she wasn’t involved, and insist on moving the discussion onto the party’s current plans, while also saying...
  • User AvatarDavid Raw 4th Jul - 5:27pm
    @ Martin, and Alex Macfie So everything was OK between 2010-15 ? Or is it a case of 'Shush, not in front of the children,...