The chair of think-tank Economists for Free Trade has accused the civil service of 'trying to pull the wool over our eyes' with a cross-Whitehall report that predicted an economic slump after Brexit.
Professor Patrick Minford, professor of economics at Cardiff University and one of the authors of the report 'A World Trade Deal: The Complete Guide', said the Chequers proposal was designed to 'keep us in the EU' and that the economy could grow even in the event of a no-deal.
The report was launched by Prof. Minford and his associates at the Houses of Parliament on Tuesday, with staunch Brexiteers Jacob Rees-Mogg, Boris Johnson, Peter Bone, David Davis and Iain Duncan Smith endorsing its findings.
Rees-Mogg, Johnson and Bone - despite their support for the report - were pictured looking glum at the event, drawing ridicule from some people online.
No-deal fears ‘nonsense’
Jacob Rees-Mogg, Boris Johnson and Peter Bone at the launch of 'A World Trade Deal: The Complete Guide'. Image: Getty
“What we were talking about [in the report] was explaining what would happen if we had no trade deal, and went to a World Trade Organisation rules-based exit,” Prof. Minford told Julia Hartley-Brewer on the talkRADIO breakfast show.
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“Without an explicit trade deal with the EU, we’d be governed by the rules of the World Trade Organisation which is far from crashing out - it’s a very orderly world where borders have to be seamless.
He branded fears about queues at the border and that goods may not meet EU standards or vice versa - something that the pharmaceutical industry has been particularly concerned about - ‘nonsense’.
‘Why should we believe your predictions?’
Watch: Peter Bone tells Julia Hartley-Brewer there is 'no alternative' in place if Chequers falls through
The report states that “long-term gain to GDP would be about 7% over the next decade and a half” and that “the average household would gain around 8%, while the poorest household will be 15% better off. The Treasury will receive about 10% extra revenue - around £80 billion”.
“Why should we believe your predictions any more than we should believe what George Osborne had to say when he was Chancellor?” asked Hartley-Brewer, adding that the report had been dismissed by Labour’s Chuka Umunna as “project fantasy” and dismissed by other economists.
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Last month, Chancellor Philip Hammond warned that a no-deal Brexit could have "large fiscal consequeces".
“There’s two reasons really,” responded Prof. Minford, before going on to claim that bringing down “barriers against the rest of the world” would bring prices down, and that the UK would have “the same seamless border as we do now.”
Civil service ‘tried to pull the wool over our eyes’
He also claimed that the Prime Minister had used the Chequers proposal as a vehicle to push a Remain agenda.
“The civil service and Mrs May didn’t want to leave the EU, hey were Remainers. What the Chequers proposals do is keep us in the EU by this rule book. They’ve made these claims through their civil service cross-Whitehall report that if we didn’t do that, there’d be all this hell breaking loose at the border.”
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He said the Economists for Free Trade report was based on the same economic model as the cross-Whitehall briefing, which was released in March, and predicted “an adverse effect on the economy of the UK and all its regions… that the degree of impact will depend on the outcome achieved in the negotiations”.
“What we’ve done is taken the economic model the civil service are using and put in the correct assumptions about the legalities… When we put those assumptions into the government’s model, lo and behold, you get the same figures as we do,” said Prof. Minford, adding he that he felt the government had “tried to pull the wool over our eyes completely”.