letter for publication post Autumn Statement and Brexit
When the Titanic hit the iceberg, it didn’t sink immediately, it kept afloat and going for some distance before it then rapidly plunged beneath the waves. So we see the impact on our economy, post Brexit.
If we hadn’t started to see it already, with the tumbling value of the pound and prices starting to creep up the true cost of Brexit is now starting to emerge, with last week’s Chancellor’s Autumn Statement.
While ‘man of the people’ Nigel Farage held a fancy reception in the Ritz in celebration of his role in the Brexit referendum, handing out Ferrero Rocher chocolates – the closest he will get to any role representing the UK as an ambassador abroad- nowhere to be seen was the £350 million a week he and the other Brexiteers promised for the NHS.
Instead Chancellor Hammond has set aside £400 million in additional civil service funding for the Department for Exiting the EU’s Brexit negotiations: hundreds of extra civil servants, instead of doctors and nurses.
The Chancellor was also unequivocal: Britain’s decision to leave the EU has seen 2.4 percentage points wiped off the country’s growth forecast for the next five years, with earnings, tax receipts, business investment and consumer demand all set to fall.
The independent Office for Budget Responsibility has reported that Brexit will blow a £59bn hole in public finances. The OBR predicts government borrowing will rise sharply — an additional £122 billion by 2020-2021: double the debt after the 2008 worldwide crash, and despite the obviously failed austerity programme pursued by the Conservatives.
Public debt, which before the referendum had been forecast to fall to below 75 percent of GDP going into the next parliament, will now rise to more than 90 percent of GDP in 2017-2018. Overall the size of public sector debt is predicted to be £1.945 trillion by 2020 — an estimate that has risen by £220 billion since the pre-referendum March forecast.
We have yet to feel the full impact of Brexit, but like the Titanic, the reckoning is on its way.
MPs need to think carefully how they vote on Article 50, next year; and the people should be given a second vote, once the final terms are known.
Andrew Dismore AM
Labour London Assembly Member for Barnet and Camden