Brexit costing Britain £500m a week and rising, says report

Press quote (The Observer)
29 September 2018

Brexit is already costing the public purse £500m a week, new research has found – a stark contrast to the £350m “dividend” promised by the Leave campaign. The Centre for European Reform’s analysis also suggests that the government’s austerity drive would be on the way to completion had Britain voted to stay in the European Union.It shows that the UK economy is already 2.5% smaller than it would have been had Remain won the referendum. Public finances have been dented by £26bn a year, more than half of the defence budget. This translates to a penalty of £500m a week, a figure that is growing.

The stark finding comes as the Tory conference begins in Birmingham, with Theresa May’s premiership under severe strain. The prime minister faces competing proposals from cabinet ministers over how she should resolve the Brexit impasse with the EU.

...The CER think-tank’s model on the costs of Brexit examined its impact up until the end of June. It said the findings were a central estimate that contained a margin of error. Researchers created a model of how Britain’s economy would have performed had Remain won in June 2016. An earlier estimate in the summer suggested that Britain’s economy was 2.1% smaller than it would have been by the end of the first quarter of 2018. As it has developed its model and updated it for the second quarter of 2018, the gap has grown.

The model also suggests that had Britain not voted to leave, the deficit would be down to just 0.1% of GDP, or £2bn. It would mean the austerity drive in place since 2010 would be all but complete.