(Originally published 07/01/2017)
The decision Britain made to leave the European Union was one that rendered everyone speechless. Politicians had not anticipated that the vote would be to leave the EU. In truth, I think they underestimated how many people might have wanted to leave when they gave them the opportunity to decide and assumed, like the Scottish referendum, people would vote to remain. They were wrong, and they certainly weren’t prepared for that.
It was only a matter of hours after the Brexit vote was announced before arguments from the Leave campaign were proved to be untrue. Facts were questioned and the real numbers behind the statistics used were revealed, leaving everyone without a clue about how exactly Brexit was going to happen.
Finally, after five months of waiting, we have the detailed price of exactly what Brexit is costing Britain.
On Wednesday, the chancellor revealed the Office of Budget Responsibilities (OBR) forecasts for the next year in the Autumn Statement 2016. Obviously, because of yet to be negotiated Brexit deals in addition to the fact that are still to leave, there is no exact deal and there is still a sufficient amount of uncertainty. However, the findings are still pretty worrying and troublesome.
According to the Autumn Statement, in the next five years we will lose 2.4% of our economic growth. This means that we will be borrowing more than £122 billion than parliament would’ve expected before the Brexit vote. Compared to the original numbers of £55.5 billion this year and £38.8 billion by next spring, these figures shoot up to £68.2 billion and £59 billion next.
If that isn’t daunting enough, then consider this: looking at the figures displayed in March, Britain was looking to enjoy a £10 billion surplus by 2019/20. Now, that has been downgraded to staggering £30 billion deficit.
People will try and argue that this is not all because of Brexit. However, this economic drop is happening for three reasons. The first, is that it is forecasted that there will be less investment in Britain. The second, is that there is more uncertainty and now a predicted higher inflation due to the sterling depreciation. The third, is that there’s a predicted weaker consumer demand. Now, what event between March and now could have caused that, I wonder.
Is this really what people would have voted for if they knew? A reality of more borrowing, a slow growth, and high inflation?
Even with this forecast and prediction, I think it’s fair to say that everything still lies in uncertainty. Everything between now and the year Britain leave the EU (2019/20) will be constantly changing, because no one will know just how things will lie for Britain once we have officially left.
If only someone had told us that before we cast our votes.
It is not even just economic effect of Brexit that is going to be damaging in the long run, as if that wasn’t terrifying enough, but the persisting and harsh push for reducing and getting rid of immigration will make the country suffer, too. Everyone was so focused to rid Britain of immigrants that they failed to recognise that it was one of the most important factors that kept out debt figure under control.
By that, I simply mean that in OBR’s fiscal sustainability report in 2013, they showed that immigration did exactly that. Where it has previously been low, the new forecast predicts a 90.2% public sector debt figure.
In 2013, OBR discovered that if immigration continued at it’s usual 140,000 a year then the public sector net debt to GDP ratio would be at most 99%. By 2062/63. Obviously, this is over a ling period of time but bearing in mind that that’s almost half a century away, we are already at 90.2%.
The reports also showed that if immigration was reduced to a complete zero, then that 99% would rocket right up to a frightening 174%.
I can’t help but wonder, where were these statistics and numbers during the Brexit campaign? Why are we only seeing this now when it’s too late?
Looking at the facts, this is the reality of our situation. Not only is Brexit economically damaging, but combined with this anti-free movement and free trade view of the world through resentful eyes, it is damaging our country as a whole. Not to mention our economic well being.
To think that this is just the beginning of Brexit is seriously concerning. And it only seems to be getting worse.