Uk Economy: Post-Referendum Assessment

Part of the debate – in the House of Commons at 2:58 pm on 23rd May 2016.

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Photo of Bernard Jenkin Bernard Jenkin Chair, Public Administration and Constitutional Affairs Committee 2:58 pm, 23rd May 2016

I reflect on the fact that obesity was rather less of a crisis for the House this afternoon than I imagined it would be, Mr Speaker.

May I first say to the Minister that we all know that these forecasts are just rubbish being produced by a Government who are now obsessed with producing propaganda to try to get their way in the vote rather than enlightening the public? Has this report been signed off by the same Professor Sir Charles Bean who has previously said that models of economic shocks are based on “gross simplifications”? Will the Minister confirm that the so-called shock scenario suggests nothing more serious than that the economy will remain the same size as it was just last year? Does that not demonstrate how Ministers have become preoccupied with dishonestly talking down Britain’s economic prospects, which is highly irresponsible?

Why do the Government not agree with the chair of the remain campaign, Lord Rose? He has been reassuring in saying:

“Nothing is going to happen if we come out of Europe in the first five years…There will be absolutely no change.”

What about my right hon. Friend the Business Secretary? He said in February last year:

“As I’ve said before, a vote to leave the EU is not something I’m afraid of. I’d embrace the opportunities such a move would create and I have no doubt that, after leaving, Britain would be able to secure trade agreements not just with the EU, but with many others too”.

What does the Minister say in response to his Conservative predecessor, my noble Friend Lord Lamont? He said this morning:

“A lot of the Government’s so-called forecast depends on business confidence, which the Government is doing its best to undermine. Economists are no better than anyone else in predicting shifts in confidence…We have nothing to fear but fear itself—which the Government is doing its best to stir up.”

The Government say that wages will fall, so why did Lord Rose tell the Treasury Committee that wages would rise if we left the EU? Is this report produced by the same Treasury that failed to foresee the banking crisis and the great recession that followed?

Why do none of the Government’s post-referendum economic assessments look at the risks of remaining in the EU? Given that in 2014 the UK contributed £10 billion net to support other, failing EU economies rather than our voters’ own priorities, what effect will the continuing collapse of the eurozone economies have on the EU budget as a whole, and particularly on the UK’s net contribution?

Does not the Government’s entire campaign reinforce the unfortunate impression that today’s political leaders will say anything they think will help them get what they want, whether it is true or not? Does the Minister not realise that my right hon. Friends the Chancellor and the Prime Minister are contributing to cynicism about politics and a sense that voters should not trust their rulers but should make their own choice and judgment, which is why they will vote leave on 23 June?