How much would 'Brexit' cost British? $6,100 per person, says government

Chancellor of the Exchequer George Osborne unveiled a study warning that a vote to leave the European Union could cost individual British households £4,300 ($6,100) a year by 2030.

Matt Cardy/Reuters
Britain's Chancellor of the Exchequer George Osborne (r.) speaks alongside Elizabeth Truss, secretary of State for Environment, Food and Rural Affairs, at an event at the National Composites Centre in Bristol on Monday. Mr. Osborne said a so-called Brexit vote in favor leaving the EU would harm individual households and Britain's economy.

As British voters prepare to decide whether to leave the European Union on June 23, finance minister George Osborne is launching an all-out campaign to persuade voters that leaving the EU could strain individual households and harm the country's economy.

"Let me tell you we would not all be in this together if we left the EU," Mr. Osborne said on BBC Radio 4's Today on Monday, calling the decision the biggest in a generation. "The richest in our country would go on being rich. It would be the poorest, the people whose jobs depend on the car plants, whose jobs depend on the steel-making plants who would be hit if we left the EU."

A vote to leave the trading bloc could cost each household £4,300 ($6,100) a year by 2030, while Britain's economy would shrink 6 percent overall, Mr. Osborne said on Monday in a column of the Times of London.

As he unveiled a Treasury study reviewing several options if Britain does vote for the so-called "Brexit," he mocked statements by London Mayor Boris Johnson, who is in favor of leaving, and called the case made by pro-Brexit campaigners "economically illiterate."

The increasing focus on personalizing the issues around the Brexit comes as many polls show the two campaigns enjoying nearly equal support, though one YouGov poll found that 45 percent of voters would favor remaining in the EU if the cost to them to was £100 a year.

But pro-Brexit campaigners blasted the Treasury's study. "It is an absurd claim from the Treasury," John Redwood, a former Conservative cabinet minister told The Guardian of Osborne's estimate that Britain's economy would shrink 6 percent. "I'm very sorry that they have degenerated to these levels."

A Financial Times "poll of polls" published last week shows a 1 percentage point advantage for the "stay" campaign, 43 percent to 42 percent.

The Brexit debate also comes in the middle of questions about the impact of economic austerity policies launched by Osborne and Prime Minister David Cameron. Iain Duncan Smith, the former work and pensions secretary who is anti-EU, resigned last month while questioning the Cameron government's commitment "to [ensuring] 'we are all in this together,' " in his resignation letter.

The Treasury study examines three options Britain would face if voters decide in favor of leaving the EU.

One is a Norwegian-style deal where Britain would have access to the EU's single market and would make contributions to the EU's budget but couldn't weigh in on its rules, The Guardian reports.

The second, which has been supported by Mayor Johnson, is modeled on a free-trade agreement the EU signed with Canada, where Britain wouldn't contribute to the EU's budget but would keep its borders open to workers from around the trading bloc.

The third is a so-called clean break or World Trade Organization approach, where Britain would trade with the rest of the EU and other nations using rules created by the WTO.

In rejecting all three models, Osborne sought to cast aspersions on a statement made by Johnson, a fellow Conservative, who once declared, "My policy on cake is still pro having it and pro eating it." The two are rivals to become the next prime minister.

"You can't have your cake and eat it. These people who go round saying Britain would have all the benefits of the EU without any of the obligations – that is economically illiterate and it frankly totally misunderstands the nature of the relationship that Britain might be able to strike outside the EU," Osborne said on Monday, The Guardian reports.

The Treasury's position is shared by others outside Britain, including the International Monetary Fund, while President Obama is expected to endorse a position that staying in the EU is better economically and politically for Britain during a visit this week, Reuters reports.

Jeremy Corbyn, the leader of the opposition Labour Party – who some in his party believed still held private reservations about remaining in the EU – outlined a "warts and and all" approach for staying in the bloc in a speech last week.

"The Labour Party is overwhelmingly for staying in because we believe the EU has brought investment, jobs and protections for workers, consumers and the environment," he said.

As Mr. Redwood, the Conservative former minister, cast a pro-Brexit vote as promising British voters the chance to cast off austerity policies, "make its own laws" and control its borders, Osborne argued such a decision would be permanently damaging.

"Put simply: over many years, are you better off or worse off if we leave the EU? The answer is: Britain world be worse off, permanently so," Osbourne wrote in the Times.

of stories this month > Get unlimited stories
You've read  of  free articles. Subscribe to continue.

Unlimited digital access $11/month.

Get unlimited Monitor journalism.