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Wednesday, 30th Aug 2017

Cost of Brexit warning from Bristol's Green MEP

With the so-called ‘divorce settlement’ a major sticking point in negotiations over the UK’s future relationship with the EU, Molly Scott Cato, who is Bristol's MEP and the Green Party's speaker on Brexit and on economics, has warned that a ‘cliff edge Brexit’ could be more costly to the UK than the cost of withdrawal from the EU.

The EU-27 are seeking an exit bill of around €60 billion to cover existing commitments. Meanwhile, the Office for Budget Responsibility (OBR), which produces independent forecasts for the government, estimates that as a consequence of leaving the EU, overall borrowing will grow by almost £60 billion over the five years 2016-17 to 2020-21. This estimate is based on predictions of less tax paid by fewer migrants, losses due to a smaller economy and increased government expenditure, mainly due to higher inflation and higher interest rates. Molly said:

“David Davis is deliberately provoking confrontation over the divorce bill when he must know that the cost of leaving the EU is equal to or less than the cost of the cliff edge outcome he and his Brexit cabal are leading us towards.

“Rather than using Brexit as an opportunity to demonstrate how tough he is, Davis should focus on what actions his government need to take to avoid a cliff edge scenario. For Greens that means remaining in the single market and customs union and offering the people a chance to decide, through a ratification referendum, whether they like the deal on offer at the end the negotiation period or would prefer to avoid the cliff altogether by remaining in the EU.”

Molly also warns that money saved on our regular net contribution to the EU – about £136 million per week – is far less than the OBR estimate for lost tax revenue and extra expenditure arising from Brexit. She said:

“The €60bn needed to cover the costs of Brexit is substantially more than the £35bn over five years that our net contribution of £136m per week to the EU amounts to. The totally misleading and notorious £350 million per week figure, promised by Leave campaigners for the NHS, was a lie then and is a lie with bells on now, as leaving the EU will prove more costly than being a member.”

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