Brexit

Treasury written question – answered on 23rd June 2020.

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Photo of Richard Holden Richard Holden Conservative, North West Durham

To ask the Chancellor of the Exchequer, what estimate he has made of the (a) gross and (b) net savings accrued to the public purse of the UK not being a member of the EU in each of the next four years.

Photo of Steve Barclay Steve Barclay The Chief Secretary to the Treasury

Having left the EU, from 2021 the UK will no longer contribute to the EU budget as a Member State, leaving only payments due as part of Financial Settlement obligations. As set out at Spring Budget 2020, the government has accounted for this when setting its spending plans, allowing it to determine how an additional £14.6 billion of spending by 2024-25 can be allocated to its domestic priorities, rather than be sent in contributions to the EU. This will be allocated as part of the overall spending envelope at the next Comprehensive Spending Review.

The OBR’s March 2020 Economic and Financial Outlook provides a forecast of the direct fiscal impact of leaving the EU. This is expected to be £4.3bn in 2020-21, £5.0bn in 2021- 22, £7.1bn in 2022-23, £11.3bn in 2023-24 and £14.6bn in 2024-25. The OBR forecast is calculated relative to their forecast of what the UK would have contributed as member state. The future contributions of member states is currently under review in the negotiation of the next MFF.

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