800,000 jobs could be wiped out if Britain votes Brexit - George Osborne and David Cameron

Posted On: 
23rd May 2016

More than 800,000 jobs could be lost as the UK plunges into recession after leaving the EU, David Cameron and George Osborne claimed today.

David Cameron and George Osborne teamed up today to warn of stark short-term consequences of voting for Brexit
Credit: 
PA Images

A short-term analysis of the risks of Brexit released by the Treasury today claims Britain’s GDP would be between 3.6% and 6% lower after two years than current forecasts.

The analysis suggests that between 520,000 and 820,000 jobs would go, while wages would fall by £800 a year on average and the value of the pound would plummet by between 13% and 15%.

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The Chancellor urged Britain not to launch itself into a “DIY recession” by voting to leave on 23 June, insisting there was a “brighter future on offer” for the nation inside the EU.

But official Brexit campaign group Vote Leave slammed the Treasury forecast as “deeply biased” and said the "same old scare stories simply don’t wash".

The drop in GDP is attributed to Britain becoming less open to overseas trade and investment from overseas, along with volatility in financial markets.

House prices are also projected to fall between 10% and 18% and there would be a “sharp rise” in inflation, the research claims.

The report says inflation would jump by 2.3% at best and 2.7% in the worst case scenario.

The discrepancy in forecasts is explained by the Treasury as the difference between the “shock scenario”, which would see the UK negotiate a bilateral trade deal with the EU, and the “severe shock scenario”, which assumes continuing under World Trade Organisation rules.

Mr Osborne told an audience at a B&Q HQ in Eastleigh: "A direct consequence of a vote to leave the EU would be significant job losses across the UK.

"Within two years at least half a million jobs would be lost… and that’s the lower end of the estimates. Across Britain as many as 820,000 jobs would be lost."

'DIY RECESSION'

He added: “It’s only been eight years since Britain entered the deepest recession our country has seen since the Second World War.

“Every part of our country suffered. The British people have worked so hard to get our country back on track. Do we want to throw it all away?

“With exactly one month to go to the referendum, the British people must ask themselves this question: can we knowingly vote for a recession? Does Britain really want this DIY recession? Because that’s what the evidence shows we’ll get if we vote to leave the EU.”

The Prime Minister painted an equally grim scenario of the UK after Brexit, as "businesses freeze up, confidence drains, uncertainty clouds over and an economic shock shakes our nation”.

Today's warnings follow a Treasury claim that households would be £4,300 per year worse off on average in the long-term if Britain leaves the EU.

'DEEPLY BIASED'

Leave campaigners have seized on the latest warnings as further evidence of the Remain camp’s ‘Project Fear’ narrative.

Former Cabinet minister Iain Duncan Smith said the Treasury had “consistently got its predictions wrong in the past” and pointed out responsibility for forecasting was removed from the department in 2010.

“This Treasury document is not an honest assessment but a deeply biased view of the future and it should not be believed by anyone,” the Conservative MP said.

“It is a fact that we hand over £350m a week to the EU. If we Vote Leave we can take back control of that money and use it to help people here in Britain.

“We will also take back control over our economy creating hundreds of thousands of new jobs as we do trade deals with growing countries in the rest of the world.”

In a statement, the Vote Leave campaign added: "Instead of talking about forecasts and woolly predictions, we should instead talk about what is happening now.

"It is a fact that - every week - we send millions to Brussels. That is what is happening right now.

"If we Vote Leave, we will substantially cut the current account deficit and thus will be able to stabilise the economy. The same old scare stories simply don’t wash."