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Treasury and Bank accused of 'peddling phoney forecasts' over Brexit impact

Published 16/06/2016

Lord Lamont described George Osborne's threat of an emergency budget in the event of Brexit as
Lord Lamont described George Osborne's threat of an emergency budget in the event of Brexit as "ludicrous scaremongering born of desperation"

Four senior Conservatives, including two former chancellors, have attacked the Treasury and the Bank of England for "peddling phoney forecasts" in a bid to scare voters into choosing to remain in the EU.

Former chancellors Lord Norman Lamont and Lord Nigel Lawson and ex-party leaders Iain Duncan Smith and Lord Michael Howard poured scorn on warnings of economic disaster from the Remain campaign.

But Prime Minister David Cameron said it is "deeply concerning" that senior Conservatives have criticised the "independent" Bank of England.

The four also hit out at pro-Remain Tories for their behaviour in the referendum debate, describing Chancellor George Osborne's threat of an emergency Budget in the event of Brexit as "ludicrous scaremongering born of desperation".

Writing in the Daily Telegraph they said: "There has been startling dishonesty in the economic debate, with a woeful failure on the part of the Bank of England, the Treasury and other official sources to present a fair and balanced analysis.

"They have been peddling phoney forecasts and scare stories to back up the attempts of David Cameron and George Osborne to frighten the electorate into voting Remain."

In the latest blue-on-blue row, the Prime Minister said voters should instead be listening to independent experts.

Mr Cameron tweeted: "It's deeply concerning that the Leave campaign is criticising the independent Bank of England.

"We should listen to experts when they warn us of the dangers to our economy of leaving the European Union."

With a week to go until polling, the senior Conservatives insisted the UK's economy is strong enough to prosper outside the EU.

As well as outlining what they see as the problems of the single market, they claimed immigration is too high, and the UK would benefit from a "managed migration system".

Concluding the article, they said: "We can remain anchored to a declining economic power with a tottering currency, bound by all the EU's laws, with little influence. This master-servant relationship makes no sense for Britain.

"Alternatively, on June 23, we have a once-in-a-lifetime opportunity to take back control of our economy and our country, to take advantage of the extraordinary potential of the world beyond the EU. We should grasp it with both hands."

Britain Stronger In Europe claimed the Leave campaign is ignoring expert economists because they are united in their warnings of damage to UK finances.

A spokesman said: "This is yet more fantasy economics from the Leave campaign.

"The reason they don't want to listen to economic experts is because they are all agreed that leaving the EU would wreck our economy and hammer family finances."

Lord Howard said it was wrong for the Government to use the Bank of England to support their campaign.

He told Sky News: "I think it's a great pity, frankly, that the Government have tried to drag the Bank of England into this debate.

"It would have been much better if the Bank of England, which after all is going to have to work with a situation whatever it is after the vote, had stood aloof from the debate and remained completely impartial."

Despite his criticisms of Mr Osborne, he insisted "I haven't lost all my admiration for him" and supported Mr Cameron's continued leadership.

Foreign Secretary Philip Hammond defended the Bank's decision to release its analysis of the risks of Brexit and blasted politicians who have "misused" the information provided by independent experts.

Answering questions following a speech to the Chatham House thinktank in London, Mr Hammond said: "Everybody has to make their own decision in this great debate, and it's important that they have as much expert opinion available to them as possible, as much analysis as possible.

"I welcome the input of independent organisations like the Bank of England, as well as the many other bodies - I think we've got an IMF report coming out tomorrow morning which will also be important in the debate. The more information the better.

"The problem isn't the institutions providing the information, the problem is the way that information is sometimes misused by people in the debate."

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