COMMONS

Previous FTA analysis does not correspond with Government’s Brexit deal

21 October 2019

In June 2018, the Treasury Committee asked HM Treasury, the Bank of England and the Financial Conduct Authority to produce analysis of the impact of Brexit in differing scenarios, and in good time before Parliament came to vote on the eventual Brexit deal. The Committee published the analysis in November 2018.

On 17 July 2019, the Committee asked HM Treasury whether officials have been undertaking these missing analyses and updating the existing analysis. The Committee also asked the Bank of England whether its macroeconomic analysis of the Withdrawal Agreement and Political Declaration remains fully relevant, and where relevant, provide the Committee with an updated version of its analysis.

The Committee published the Bank of England’s updated analysis on 4 September 2019 here, but so far it had not received HM Treasury’s updated analysis.

Last Friday, Catherine McKinnell MP, Interim Chair of the Treasury Committee, wrote to Rt Hon. Sajid Javid MP, Chancellor of the Exchequer, asking HM Treasury to publish its updated economic analysis ahead of the meaningful vote on Saturday.

Interim Chair's comments

The Committee received the Chancellor’s response today, which it has just published. Commenting on the correspondence, Ms McKinnell said:

“The Chancellor has acknowledged that the Government’s previous economic analysis of a free trade agreement does not correspond to the agreement that the Government will now be seeking.

“The Government, therefore, appears content that MPs be expected to vote blindly on its new deal. The dearth of relevant economic analysis on which MPs can decide how to vote is deeply concerning.

“Whilst the Chancellor commits to provide analysis “at appropriate points”, it’s unclear whether the analysis will be published before any further meaningful votes or the publication of the Withdrawal Agreement Bill.

“In the meantime, the existing analysis and scenarios remain the most current Government tool for providing, in the Chancellor’s words, “an understanding of how changes to our relationship with the EU might affect the UK economy”.

“The Government must therefore urgently explain why the previous analysis of an FTA does not correspond to the FTA in the political declaration and provide clarity on what the impact is of the current proposals.”

Further information

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