AT what point will the most ardent Brexiteers admit what is really going on? Even before the EU referendum in June last year, the uncertainty of the outcome started to cause a drag on the economy.
Then, when the UK went ahead and voted to leave, the effect gathered pace: the value of the pound fell, inflation and the cost of living rose, wages stagnated, business investment slowed and some companies started to plan to move their operations abroad. And yet still the Brexiteers put their fingers in their ears and refuse to listen.
However, far from the situation improving, the assertions of the Brexiteer deniers are now looking even harder to justify, with some significant new evidence emerging in a report which adds more alarming details to the Brexit effect.
According to the report from the research body the Centre for Economic Performance (CEP), Brexit is costing the average household in the UK £7.74 per week through higher prices – the equivalent of £404 a year.
The report has also looked at wages and includes a striking estimate of the effect higher inflation, caused by Brexit, has had on real wages. To put it one way: the Brexit vote has cost the average worker almost one week’s wages.
As we know, this Brexit downward pressure, which is being felt particularly acutely in Scotland, comes on top of ten years of austerity which have already had a long and depressing effect on living standards and household incomes. Before the decision to hold a referendum, there were the first small signs of recovery, but then along came the vote for Brexit, a fall in the pound and a rise in inflation.
There will be some who say that the new report putting figures to this effect is yet more remoaning and scaremongering, but this report is not about the prospects for after Brexit, it is about what is already happening now, before Brexit.
We know, for example, that inflation is some nine times what it was before the referendum – this is not remoaning, it is just a fact, and it has two effects. First, it simply makes it more expensive for people to buy everyday goods, but it also has an effect on the wider economy by forcing cash-strapped consumers to spend less on the high street, which increases the pressure on shops and businesses.
Sadly, there is no prospect of any of these effects improving in the near future – the fact that we are leaving the EU will damage the British economy; indeed, the CEP report shows it is already doing so.
With some certainty for businesses, employers and consumers, the economy could perhaps begin to deal better with the shock. But what we have instead is chaos and uncertainty – and the prospect, once mocked but now much more realistic, of a cliff-edge, no-deal Brexit.
What our economy is craving more than anything is some indication of where we are going; the Government must provide it before even more damage is done.
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