- Reuters / Hannah McKay
- An impact assessment commissioned by Mayor of London Sadiq Khan warned the UK economy could lose £54 billion by 2030.
- Khan commissioned the research after Brexit secretary David Davis said the government had failed to analyse the potential impact of Brexit on specific sectors.
- The research also suggests 500,000 jobs could be lost under a “hard Brexit” scenario, with 87,000 at risk in London.
LONDON – Brexit could cost the economy £54 billion and 500,000 jobs by 2030 depending on the deal the UK strikes with the EU, according to a set of impact assessments commissioned by Mayor of London Sadiq Khan.
Khan commissioned a series of impact papers to determine the potential impact of different Brexit scenarios on key sectors of the UK economy after Brexit secretary David Davis said the government had not done so.
The scenarios examined include leaving the EU single market, leaving the customs union, or failing to secure a transition deal by March 2019, described as a “hard Brexit” in the study.
The research, carried out by Cambridge Econometrics, found UK economic output could be 3% lower by 2030 if Britain leaves the single market and customs union, while output in London could be 2% lower, indicating a significant blow to the economy.
Labour mayor Khan, who campaigned for Remain, said in a statement: “The analysis concludes that the harder the Brexit we end up with, the bigger the potential impact on jobs, growth and living standards.
“Ministers are fast running out of time to turn the negotiations around. A ‘no deal’ hard Brexit is still a very real risk – the worst possible scenarios.”
Gareth Bacon, the London Assembly Conservatives’ group leader, said in a statement: “Sadiq Khan, a well-known Remainer and advocate of Project Fear, has simply produced a continuation of his widely-publicised anti-Brexit views.
“This is hardly a surprise, particularly given that most of the authors of this ‘independent’ report are already on record as vehemently opposing Brexit.
“The fact is, the economic collapse that Remainers like Sadiq Khan predicted would happen immediately after the referendum, has not occurred.”
The research suggests 500,000 jobs could be lost under a “hard Brexit” scenario, with 87,000 at risk in London. It said financial and professional services would be the “worst affected key sector,” with 119,000 fewer jobs nationally.
The research is likely to infuriate cabinet ministers who have dubbed similar research “Project Fear,” and who criticised the Treasury for research which incorrectly predicted the UK would slide into an immediate recession if it voted to leave the EU.
Khan defended the research. “It’s astonishing that the Government has failed to do any proper impact assessments on what Brexit could mean for our economy,” he said.
“Their complete lack of preparation is irresponsible leading to fears that they are putting party politics ahead of the national interest.”