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Sat, 28 March 2020

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Philip Hammond facing fresh Tory backlash over 'sub-standard' no-deal Brexit warning

Philip Hammond facing fresh Tory backlash over 'sub-standard' no-deal Brexit warning

Emilio Casalicchio

3 min read

Philip Hammond has sparked a fresh Tory backlash after he launched a grenade into Government efforts to play down the risks of a no-deal Brexit.


The Chancellor was accused of peddling “dodgy project fear” after he warned crashing out of the bloc without a future arrangement in place could have “large fiscal consequences”.

His incendiary comments were released in a letter to the chair of the Treasury Select Committee Nicky Morgan just hours after Brexit Secretary Dominic Raab had sought to calm fears.

Mr Raab said there were risks to a no-deal departure but insisted the UK would be better off outside the bloc in the long term, as he released 25 advice documents covering a worse-case scenario Brexit.

But the dust had hardly settled on the announcement when the letter from Mr Hammond warning against “GDP impacts of this magnitude” was published to the Treasury website.

According to the Telegraph, neither Mr Raab nor Downing Street were aware of the intervention beforehand - and both were unimpressed.

Tory MP Marcus Fysh blasted Mr Hammond over what he dubbed “yet another installment of dodgy project fear” and said he had criticised the “sub standard” analysis six months ago.

In a hint that the Chancellor should be sacked, the Yeovil MP added: “This is proof it is nothing but scaremongering and it’s shocking the proponents are still in post.”

 

 

Jacob Rees-Mogg, chair of the European Research Group of pro-Brexit Tory MPs, told the Telegraph: "As a dog returneth to his vomit, so a fool returneth to his folly.

He added: “The naysayers in the Treasury have consistently wanted to paint a bleak picture because they are frightened of taking responsibility for managing the economy without the crutch of the EU. It is a sign of their weakness.

“What Mr Hammond is doing now is a reminder of why no-one believes the politicised forecasts of the Treasury.

“The Treasury is desperate to stop Brexit. Everything the Treasury does has to be read in this light.”

But Treasury committee chair and Remain campaigner Nicky Morgan said the letter from Mr Hammond confirmed that a no-deal Brexit would be a "disastrous hit" to the economy and living standards.

'DELIBERATE INTERVENTION'

In his letter, Mr Hammond said borrowing would be £80bn a year higher by 2033/34 after a no-deal departure from the EU, and GDP could be hit by 7.7% over the next 15 years compared with the “status quo”.

A Government source told the Telegraph: "This was a deliberate intervention by Philip, he knew exactly what he was doing."

A Downing Street source added that the analysis cited by the Chancellor was preliminary and a work in progress.

Meanwhile, Roberto Azevedo, boss of the World Trade Organisation, told the BBC a no-deal Brexit was neither going to be "the end of the world" nor "a walk in the park".

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