Fragile family finances make Brexit unaffordable

Over the last few days a frightening juxtaposition has emerged between the Brexit Impact forecasts and solid evidence of the precarious nature of family finances in the UK. Whatever the scale of the adverse Brexit impact proves to be it would seem that a substantial proportion of our fellow citizens lack the financial resilience to cope with any impact at all.

The RSA report “Seven Portraits of Modern Work” paints a vivid picture of an economy in which the tentacles of financial fragility permeate well beyond the lowest paid, penetrating the Tory-voting classes to the extent that around 70% of those in employment have reason to feel financially insecure.

The report demonstrates that while a smug Government is trumpeting how the quantity of work remains buoyant, many of our fellow citizens are struggling to stay afloat financially because of the poor quality of much of the work that is available.

The earlier Taylor Report described “good work” as that which is fair, decent and offers a realistic scope for development and fulfilment. This new report develops the good work concept further by examining the extent to which workers enjoy economic security; “the degree of confidence that a person can have in maintaining a decent quality of life, now and in the future, given their economic and financial circumstances.”

Analysing economic security (or, for most people, the lack of it) alongside other attributes of “good work” the report broke the workforce down into seven segments which it suggests could provide an alternative means of defining social class structures. Of these, the evocatively labelled “Acutely Precarious” and “Chronically Precarious” together comprise, alarmingly, over 30% of the workforce, with under 35s and members of BAME communities overrepresented in these groups.

Furthermore, it seems that a good education is no longer a passport to financial security; 45% of the Chronically Precarious possess a degree. Worryingly, apart from the 30% or so who consider themselves comfortably off, symptoms of economic insecurity afflict pretty much everybody else. These include; absence of potential family support in a crisis (43%), concerns over debt (29%), savings below £500 (32%) or below £1000 (41%). While 34% identify as the famous “just about managing”, 26% don’t feel they earn enough to maintain a decent standard of living and 19% sometimes have difficulty making ends meet because of income volatility.

Another recent RSA report, Addressing economic insecurity, defined the latter as; “harmful volatility in people’s economic circumstances”. This includes exposure to risks to their economic wellbeing, and their capacity to prepare for, respond to, and recover from, shocks or adverse events.

Brexit was never promulgated on the basis that there would be immediate benefits in terms of economic growth. Even the most frenetic rubbishing of forecasts will not change that. Already we have deteriorated from the fastest-growing economy in Europe to the slowest growing economy in Europe.

The idea behind Brexit was that somewhere over the rainbow lies a prosperous future, even if it is one based on fantasy rather than forecasts. So what if the Yellow Brick Road doesn’t appear on Google Maps? No matter, a feeling of national pride in standing alone has been promoted as being worth some financial pain in the Brexit aftermath; but pride comes before a fall.

As a country it seems that we can no longer afford proper healthcare or other public services, or even adequately fund the defence of the realm. Lower rates of growth already mean that the search for a Brexit Bonus will prove about as fruitful as searching for a Unicorn in the New Forest.

With family finances already on a knife edge it is not the scale of the negative Brexit impact which matters. Those workers who already find themselves among the ranks of the Acutely or Chronically Precarious are in no position to cope with any impact at all, and the “just about managing” are at risk of becoming unable to manage to make ends meet. The pursuit of an illusion of national pride, rooted in nostalgia for the days of Empire, is a luxury that 70% of British families simply cannot afford.



* Andrew Haldane is a former councillor and parliamentary candidate and current Chair of the Macclesfield local party and Vice Chair (Policy) of the NW Regional Party. In his earlier career, he worked in Marketing as a practitioner and later as an academic with an interest in Consumer Behavior applied to the shaping of Attitudes and Belief.

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  • Peter Martin 6th Feb '18 - 9:06am

    There really needs to be more discussion about other things than Brexit!

    We are where we are. Our problems have arisen whilst we have been EU Members. We can’t blame everything on Brexit.

  • You are ‘putting the cart before the horse’; as my mother used to say…..Many people voted to leave BECAUSE of their financial and social fragility…

  • We can hardly say to the public “sorry, we’re cancelling Brexit because it doesn’t make financial sense” – that was the argument which was lost in June 2016 when it was clear to everyone that economically it made more sense to Remain (which is why we campaigned for it).

  • John Barrett 6th Feb '18 - 10:02am

    If “As a country it seems that we can no longer afford proper healthcare or other public services, or even adequately fund the defence of the realm.”

    This cannot be blamed on something (Brexit) that has not happened yet.

    More likely that it can be blamed on choices made by this and previous Governments.

    If we can afford to build a new aircraft carrier, provide tax cuts and incentives to the already wealthy and a pump large sums into supporting questionable nuclear power generation projects, alternative choices could have provided more for the NHS and other worthwhile public services.

    With regards to economic forecasts – economists may, or may not, have a range of talents, but the track record of such economic forecasts over the last 20 years now makes many forecasts fairly worthless.

    I suspect that, as with legal advice, another well qualified expert can always be found to say the exact opposite of their colleagues.

  • Arnold Kiel 6th Feb '18 - 11:24am

    Sorry Andrew, Brexiters are not interested in gradualism. If you do not prove to them that EU membership makes everybody well off, they stick with leaving, irrespective of the gradient of the decline. They do not care about the relative levels of unemployment, food-bank-usage, defense-capability, infrastructural decline, child poverty, prison-violence, premature deaths. “We had all that as an EU-member, so these phenomena have nothing to do with Brexit”.

    As I wrote over a year ago: Brexit empoverishes, endangers, brutalizes, and kills. Still, no leaver cares.

  • nvelope2003 6th Feb '18 - 11:38am

    A few rich men have bet about £100 billion of the nations resources that leaving the EU will make them even richer and they have appealed to ordinary people’s sense of nationalism or patriotism to get them to vote for it which they have graciously done. Those rich men will not be seriously affected if their cost free (to them) bet fails. They would prefer to do that than provide a decent education system, health service etc because they can afford to send their children to private schools and pay for health care.

    The German Government has looked after its own people in a way that ours should have done and of course it is subject to intense criticism for it from our media and their friends.

  • As has been noted above, this argument was made in June 2016 – and was rejected. Endless lines of MPs, economists and others piled up to remind people that a vote to leave would be harmful both in terms of national economics and personal finances. People rejected this argument. It is NO BASIS for overriding the result of the referendum.

  • Stephen
    48% remain no argument?
    Would this include the remain voters who want ever closer union v the ones that want to scale back, the socialistic ones v the market forces ones, the small state conservatives v statist Labour, the various nationalists (Scotland, Northern Ireland, Wales) v United kingdom ones, the pro immigration v lower immigration ones and so on? Even 30% of Lib Dem Supporters vote to leave.!
    There was no consistent 48% which is why in the general election most of them voted along the usual party political lines.

  • Peter Martin 6th Feb '18 - 3:01pm

    @ Arnold Kiel,

    “Still, no leaver cares.”

    Instead of writing silly comments like this you would be better off going to the library and learning how the economy actually works. Then you mighty know a little better what you are talking about. Or, doesn’t work in the case of the eurozone. Then you’d at least understand why what has been constructed is not at all working as planned and is giving us all the problems it does. The fall-out from the dysfunctioning eurozone doesn’t stop at EU/EZ borders. We aren’t totally protected from all that.

    Is there any sensible reason why we have to pay such high tariffs on imports of foodstuffs from outside the EU? The EU, if we believe those who are in love with it, is about supposed to be about free trade – but the reality is that its just another protectionist bloc which consists either of mercantalist countries like Germany or countries with depressed economies like Spain and Italy. Either way they aren’t good markets for UK exports. So, whereas our trade with the ROW is balanced and growing, it is highly imbalanced and falling with the EU. That imbalance gives us debt problems. Someone in the UK has to borrow to support it.

    Sure there is going to be some disruption when we make the break. But the sooner we do it the better.

  • John Barrett 6th Feb '18 - 3:55pm

    Arnold Kiel – As our present levels of unemployment, food-bank-usage, defense-capability, infrastructural decline, child poverty, prison-violence, premature deaths have ended up at their present levels while we have been members of the EU. Would you ever consider saying that no Remainer cares? I think not

    Whatever the reason people voted Leave, and this is supposed to include 30% of Lib-Dem supporters, I do not for a minute think that “no Leaver cares”, as you have written.

    One problem of writing “Still, no leaver cares.” is that any attempt by the party to get those who voted that way to change their minds becomes all the more difficult, after insulting them.

    After speaking to many people who voted both remain and leave, I am sure that whatever the reasons they had, not one of them on either side of the debate did not care.

    I suspect that it is much more likely that some of those who did not vote, did not care.

    Even then, I suspect that many who chose not to vote, also did care a lot about their future and that of their children and grand-children. It might have been that during a campaign, where both sides were clearly guilty of mis-representing their cases, that the poor voter, who did care, just did not know what to believe or what to vote for.

  • Red Liberal 6th Feb '18 - 3:56pm

    This site is heaving with Brexiteers and their ultra-nationalist fantasies.

  • John Barrett

  • Andrew Tampion 7th Feb '18 - 5:15am

    It seems to me that this site is heaving with Ode to Joyers and their ever closer union fantasies.

    The referendum happened and the result needs to be accepted (not necessarily agreed with) and honoured.

    For me, as a party member and remain voter, all this re-fighting lost battles, insulting those who voted leave and bluntly whinging about the result is neither Liberal nor Democratic. And as the polls show it’s not doing our party any good.

  • Peter Watson 7th Feb '18 - 7:49am

    @Stephen Johnson “Remain = status quo. Fairly straight forward.”
    You seem to be suggesting that those of us who voted Remain were choosing “the precarious nature of family finances in the UK”, “a substantial proportion of our fellow citizens lack the financial resilience to cope with any impact at all”, “around 70% of those in employment have reason to feel financially insecure”, “many of our fellow citizens are struggling to stay afloat financially because of the poor quality of much of the work that is available”, “a good education is no longer a passport to financial security”, “we can no longer afford proper healthcare or other public services, or even adequately fund the defence of the realm”.

    No wonder we lost.

    It is so depressing to see that the Lib Dems, notionally the pro-EU party, are still stumbling along with the failed dismal Remain campaign strategy and failing to address how British people’s lives can be made better within the EU by offering more than the status quo to those who felt Brexit was worth the risk.

  • Stephen
    I think I already answered you. The idea that Remain is the status quo is far from clear. If anything the closest to a majority opinion or the status quo is actually to leave which is why there is both an electoral and parliamentary majority to do so. I think these articles are more about rallying the troops than fighting a credible case. It’s over really. Brexit won’t be stopped coz there is nothing much to stop it.

  • This article by Andrew Haldane adds nothing to the debate about Brexit I am sure all those who voted Remain accept that there are most likely to be economic costs to leaving the EU. However, I assume most of those who voted Leave either don’t believe it or it is not that important to them.

    I have to agree with Peter Watson that with the state of people’s finances as presented by Andrew Haldane and the Remain campaign being the no change option it is “no wonder we lost”.

    The Party and it seems a majority of members think more of the same failed campaign about the supposed economic consequences of leaving the EU will win a referendum on the deal verses the status quo. I think they are wrong. If we do manage to get a referendum on the deal verses the status quo we will lose again.

    As I keep saying we need to get the EU to address the two main issues that seem to have persuaded the majority of the British public to vote Leave – restricting the free movement of people until the EU solves the issue of economic migration across the EU (which I think will include reforming the economic policy of all member countries to get full employment in their country and no longer have controlling inflation and controlling the size of government deficits as their main aims) and “give back control” to national Parliaments, that is reform the structures of the EU so it is very clear that National Parliaments are in ultimate control of the EU. If we can offer a reformed EU that includes my suggestions then maybe, just maybe we can get a majority of British people to vote to stay in a reformed EU that puts full employment at its heart.

  • The latest story about the EU punishing the UK doesn’t help. The Guardian today :

    “Brexit: EU to have power to punish UK at will during transition. Exclusive: Brussels could impose sanctions if it believes law infringed, leaked document says”

    Maybe it’s time Lib Dems should consider the EU doesn’t really want the troublesome UK any more ?

  • Stephen
    Actually if you look the figures up on issues like immigration, free trade, law and sovereignty there is a lot of unity amongst Leave voters. My point was that the idea that leave is a 101 varieties is a bit of a myth and you could equally point to contradictions in the remain vote. Students voting with people who introduced tuition fees, trade unions voting with anti union Tories, the nationalist parties voting with unionists and so on. If anything there are actually more contradictions and uneasy alliances in the Remain camp which is why there is/was so much bickering about whether or not this or that political figure is/was really committed to the EU cause or are/were making enough of an effort.

  • nvelope2003 7th Feb '18 - 12:47pm

    People keep saying that no one votes to make themselves poorer yet I keep hearing people say they would prefer to be poorer and out of the EU than in it. The original Common Market was founded to bind the European countries together and stop the cruel wars that regularly took place. Before the Second World War millions of people were living in absolute poverty in Europe (including the UK despite our Free Trade policy of no tariffs on food) Living standards have soared beyond many people’s wildest dreams since 1945. Abandoning a degree of protection for agriculture sounds fine but when we did this in the past agriculture collapsed and we became entirely reliant on imports which was fine when we were a relatively rich and powerful country and many countries were not. Now the peoples of the world expect to have the same amount of food as Europeans, Americans etc and with rising populations there might not be enough food. It would take more than a week or two to rebuild our agriculture so what would people do in the meantime ?

    It is clear that many of those who voted to leave the EU did so because they wish to stop or severely restrict immigration but if our economy depends on immigration to prosper because our education system does not provide the skills needed then we will not prosper until we change it.

    When National Parliaments had the power to do as they please as Leavers wish Europe was plagued with endless wars but I guess not many middle aged people know that.

  • nvelope2003 7th Feb '18 - 12:50pm

    Having said all that I think we should abide by the result of the referendum and leave the EU. We need to learn that actions have consequences.

  • Sue Sutherland 7th Feb '18 - 12:50pm

    Andrew I’m glad that you are concerned about the fragile life many people lead and thank you for bringing this to our attention. Unlike most of the commentators here I would not lay this at the door of the EU. If you take this report in conjunction with a recent one on our low productivity rate which results from a failure to invest in skills, jobs and infrastructure it’s very clear that we should be looking to domestic policy failure when looking for a cause. The reason why several very rich men invested in the Brexit campaign is that they want their workforce to be even less secure and to do away with the rights which have resulted from being a member of the EU so that they can become even richer.
    We have to keep reiterating this and come up with solutions in order to justify our stance on Brexit. I am devastated that the Lords report on the Left Behind won’t be debated at conference. It would have provided the context for policies on the NHS, education and rural affairs.
    What your article shows us is that we must also find the funding to create more job opportunities for people to enjoy security as well as improving the safety net for them if that security fails.

  • Arnold Kiel 7th Feb '18 - 5:31pm

    Andrew’s affordability-question is the relevant one, and we remainers deserve a considered response to it from leavers (if they care). If “around 70% of those in employment have reason to feel financially insecure” that also means that a minor misfortune (losing ones job being a rather major one) can push those families from just getting by into a catastrophy.

    Since the referendum, around 2% of potential GDP have already been lost, and the Governent’s strategy will produce another -5%- -8% over 15 years. No serious economist disputes that.

    The odd Prof. Minford, the only one who states otherwise, at least has the honesty to admit that the UK would terminally deindustrialize, in his view not a problem. Remember that the UK was there already once, before the French approved its second, rather desperate, EEA-membership application. The UK’s industrial renaissance since was driven by global investors preferring an English-speaking EU-bridgehead or picking up residual brand values that were perceived to be tied to “Made in England”.

    Now imagine this services-only economy, which was two parts: high- and low value added. The former employs (as Andrew rightly points out not all) academics. The leaders of these industries (e.g. financial services, advertising, music, legal, healthcare…) are practically 100% for remaining. That is logical, as they do good business with the EU and, importantly, EU-membership does not limit their global reach one little bit. They are all global leaders already, their products need no physical shipment, and cross borders in a cable or the first rows of a passenger jet. For them, Brexit has only costs and no benefits.

  • Arnold Kiel 7th Feb '18 - 5:32pm


    Low value services will be the employment for all other academics, and non-academics: driving white vans (as long as they need drivers), retail (unless delivered), cutting hair, cleaning, agriculture (to the degree it survives environmental, social, and safety-dumping by tariff-free global imports), etc.

    I find it rather cynical to believe that this scenario is what 17,4 million leave-voters wanted. If you eliminate the derogative ism, protection remains as one key aim of the EU, and I strongly believe that was what most leavers were hoping for (and dishonestly promised). This elimination also works well for capital and social, two other elements needed in the right mix for any civilized society. I am not saying that EU-membership solves all the UK’s economic problems, but it avoids inflicting additional unneccessary damage.

    Since 2 years, I am waiting for a Brexit businesscase that improves ordinary Briton’s lives. There is nothing. It is about time somebody comes up with one, otherwise, the only explanation for your stance is that you don’t care.

    P.s. I shall not engage with any borow-and-consume-your-way-out-of-misery-by-limitlessly-printing-your-own-currency-nonsense anymore.

  • Peter Martin 8th Feb '18 - 8:32am

    @Arnold Kiel,


    Just on a point of information: it’s all done in computers these days. The amount of money created by printing is neither here nor there by comparison to the amount of digital money in the system. So, theoretically, there is no limit to the amount of money that can be created. Anyone sitting in the BoE, the Treasury, the ECB can create as many pounds and euros, respectively as they like. Just add one too many zeros and oops!.

    But that is not to say they should do that. An economy should be like Goldilock’s porridge. It should be neither too hot nor too cold. The Government, unlike anyone else, has the ability to control that temperature.

  • Peter Hirst 8th Feb '18 - 6:12pm

    We should be marketing Brexit as an affordable luxury for most of those who want it.

  • Peter Hirst 8th Feb '18 - 6:13pm

    sorry, that should read “unaffordable luxury”.

  • It is clear that many of those who voted to leave the EU did so because they wish to stop or severely restrict immigration but if our economy depends on immigration to prosper because our education system does not provide the skills needed then we will not prosper until we change it.

    And the LibDems should be using Brexit to get the government to stop being two-faced and deliver on the Brexit promises, both on significantly reduced net immigration (both EU and non-EU) and on the investments necessary to improve the skills of UK nationals. Brexit has implications and costs beyond the debates about trade and ‘sovereignty’.

    The only real issue is presenting LibDem policies (eg. managed immigration, investment in education etc.) as policies that Brexit both enables and need, if it is to be a success…

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