Leaving without a deal would cause the most damage, while a Canada-style agreement could shrink GDP by 6.9 per cent and a Norway agreement by 1.6 per cent
Theresa May’s Brexit deal will leave the UK economy 3.9 per cent worse off than if Britain was to remain in the EU, with every other scenario also shrinking the economy, according to the government’s own research.
Despite claims by Brexiteers that cutting EU migration would allow pay to go up, real wages are predicted to fall by nearly 2.7 per cent after inflation. The analysis also found that every region of the country is set to be worse off in 15 years time, with London receiving the hardest hit.
A Norway-type deal would see a reduction of 1.4 per cent GDP over the 15 year period – less than the 3.9 per cent hit from the current plan – and less than a Canada-type free trade agreement (6.7 per cent). Alternatively, a no deal could see the UK GDP reduced by up to 5.5 per cent or £140 billion.
Responding to the analysis, Femi Oluwole of pro-People’s Vote group Our Future, Our Choice told JOE.co.uk: “The idea that our country, where lots of people are already struggling, would intentionally choose to harm its own economy by 4 per cent, is shameful.
“People didn’t vote to be worse off – we can all agree on that. OFOC hopes that people will forget the political mess of the last two years and prioritise what the people of this country actually need.”
Foreign secretary Jeremy Hunt admitted on Sunday that the UK would only get between 70 per cent and 80 per cent of what it wanted out of the current deal. But he says he believes that most of the economic drawbacks should be mitigated by what is currently on the table.
Meanwhile, the prime minister is set to try and convince parliament to back her deal in efforts to get it over the line. If this is unsuccessful as is currently predicted, a number of options remain including a no deal agreement, a renegotiated deal or a general election.
The release of the report comes after a study by the National Institute of Economic and Social Research said that in total, the UK will be £100 billion worse off than had it remained in the EU.