Blog: Ian McConnell: Curious Tory Brexit portrayal but truth lies in independent view – HeraldScotland

It was at least a curious reference, and some might have considered it spurious, wedged between a somewhat baffling holding up of 1980s Tory chancellor Nigel Lawson as something of a hero and notably vague talk about announcing changes to assorted European Union regulations by the end of next year.

And it seemed a long way indeed from all the tub-thumping of the Brexiters, who were making an extremely noisy if nonsensical racket until quite recently. Then again, based on recent polling, we should perhaps not be surprised by this dramatic toning down of the rhetoric on Brexit from our Conservative leaders, given it appears growing numbers of people who were tempted by the Leave campaign’s empty promises have been realising they might have been taken for mugs.

Thankfully, the Office for Budget Responsibility, given the need to hold the ruling Conservatives to account for the Leave folly, provided far more substance on Brexit than what was offered by Mr Hunt.

Given the OBR was highlighting the simple factual truth of the damage that Brexit has done and will continue to do to UK trade, it was not surprising at all that Mr Hunt did not reference the independent forecaster’s assessment of the EU departure effects in his Autumn Statement speech.

He was, of course, happy to reference the OBR (selectively) in other contexts.

What the Chancellor had to say around his single mention of Brexit was: “We learned from the success of Nigel Lawson’s Big Bang in 1986 that smart regulatory reform can spur investment from all over the world. So today, using our Brexit freedoms, I confirm the next step in our supply side transformation.

“By the end of next year, we will decide and announce changes to EU regulations in our five growth industries: digital technology, life sciences, green industries, financial services and advanced manufacturing. And I have asked the chief scientific adviser Sir Patrick Vallance, who did such a brilliant job in the pandemic, to lead new work on how we should change regulation to better support safe and fast introduction of new emerging technologies.”

The end of 2023, it is worth noting, will be around seven-and-a-half years from that demoralising Leave vote.

The “we will decide and announce changes” implies there is not that much of a plan in place at the moment, and we are already nearly six-and-a-half years on from the EU membership referendum. Maybe there is not that much of a plan because there is little, if anything, in EU regulations holding these sectors back. There seem to be plenty of success stories in the sectors highlighted in various EU countries.

READ MORE: Brexit: Chancellor Jeremy Hunt’s astounding take is beyond unsettling

The Chancellor, who only a few days earlier had declared his belief that the UK could make a “tremendous success” of Brexit, appeared to be clutching at straws on this front in his Autumn Statement. And that is putting it mildly.

It is not the first time a chancellor has appeared a little desperate when trying to find some supposed upside of leaving the EU to throw into a speech. In his mini-Budget in September, former chancellor Kwasi Kwarteng said: “We can announce that, in the coming months, we will bring forward a new Bill to unpick the complex patchwork of planning restrictions and EU-derived laws that constrain our growth.”

He seemed quite unspecific on which “EU-derived laws” supposedly constrain growth. Mr Kwarteng should perhaps have acknowledged what was actually, in the context of the EU, the thing that was bearing down so heavily on UK growth. That thing is, of course, the Tory hard Brexit.

In October 2021, in his second Budget of that year, former chancellor and now Prime Minister Rishi Sunak found it necessary to go into great detail on tonnage tax in a seeming attempt to find or engineer something positive in the context of Brexit.

READ MORE: Ian McConnell: Hopes of end to Brexit stupidity under Braverman and Sunak look misplaced

Mr Sunak said: “I want to begin with one of our smallest taxes – but a tax which plays an important role in one of our pre-eminent industries: shipping. Now that we’ve left the EU, today we start reforming our tonnage tax regime to make it simpler and more competitive. And we’re also making it fairer for UK taxpayers.”

And he was not done there.

Mr Sunak added: “When we were in the old EU system, ships in tonnage tax regime were required to fly the flag of an EU state. But that doesn’t make sense for an independent nation.

“So I can announce today that our tonnage tax will – for the first time ever – reward companies for adopting the UK’s merchant shipping flag, the Red Ensign.”

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So there has surely been a pattern of somewhat bizarre attempts to try to claim some benefit of Brexit. The Theresa May government’s forecasts, published in November 2018, showed Brexit would, with an average free trade deal with the EU, result in UK gross domestic product in 15 years’ time being 4.9% lower than if the country had stayed in the bloc if there were no change to migration arrangements. Or 6.7% worse on the basis of zero net inflow of workers from European Economic Area countries.

This seems like far more important information on Brexit than that imparted by Messrs Hunt, Kwarteng or Sunak.

In stark contrast to Mr Hunt, the OBR was very clear indeed last week in its analysis of the substantive effects of Brexit to date and what is yet to come.

It said: “Near-term growth in exports and imports is lower than in our March forecast as slowing global GDP (gross domestic product) growth hits exports and a weaker outlook for consumption and investment weighs on imports. Our trade forecast reflects our assumption that Brexit will result in the UK’s trade intensity being 15 per cent lower in the long run than if the UK had remained in the EU. The latest evidence suggests that Brexit has had a significant adverse impact on UK trade, via reducing both overall trade volumes and the number of trading relationships between UK and EU firms.”

Analysing the detail of the OBR statement, it should surely be a concern that the number of trading relationships between UK and EU firms, as well as overall trade volumes, is being hit hard by Brexit.

This surely does not bode well for the future.

And “significant adverse impact”, coming from the OBR, is something that should most certainly make Mr Hunt and his fellow Cabinet members sit up, take note, and think again.

Recent history would suggest that will most certainly not happen.

Instead, we seem likely to be faced with the prospect of further desperate attempts by the Tories to fly in the face of the simple reality that their hard Brexit is causing huge damage to the UK economy, with the population at large footing the bill for their foolishness.

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