Claims that the UK’s economy would be hit by a Brexit have been ridiculed by MPs, the media and Twitter users, left bamboozled by complex Treasury economic forecasts they say are “absurd”.
Chancellor George Osborne claimed this morning that the UK will suffer “decades of pain” if there is a vote to leave Europe as the Treasury published a 200-page report arguing the UK would see GDP 6% lower in 2030 than if the country remains in the Union.
One equation published in the report this morning, and the central one used to determine the economic impact of Brexit on UK household finances and the wider UK economy, has been posted multiple times on Twitter after it left people scratching their heads.
John Redwood, Conservative member of parliament for Wokingham and leader of the Conservative policy group on economic competitiveness and who is campaigning for an Out vote told the BBC Radio 4’s Today Programme the forecasts were “completely worthless”.
He said: “It’s an absurd claim from the Treasury. I am very sorry they degenerated to these levels.”
Meanwhile in an interview with Sky News, fellow Tory MP Bernard Jenkins said Osborne “should be ashamed of himself”.
The Treasury’s predictions could be construed as misleading as the claim that Brexit would cost every household £4,300 a year suggests families will lose money.
But rather than the economy shrinking 6% by 2030 and families losing £4,300 a year, the Treasury’s analysis is actually claiming that the economy will be 6% smaller in 2030 than it might otherwise have been if Britain hits its economic growth targets over 15 years and the population rises by the rate forecast by the Office for National Statistics.
Oxford Economics recently published forecasts that suggested the UK economy would be just 3.9% worse off by 2030 if the country leaves the EU; PWC and the CBI also put out research which suggested that the impact would be just 3.5% lower GDP growth by the same year.
Osborne said earlier this morning that those campaigning in favour of Brexit were “economically illiterate”.
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