Belfast Telegraph

Clean break could boost poorer households, Brexit-backing economists claim

A clean break from the European Union by cutting regulations and removing trade barriers could boost the finances of poorer households, Brexit-backing economists have claimed.

The slump in the value of sterling following the Brexit vote will boost exports, and scrapping the Common Agricultural Policy will lead to lower land and property prices, according to a joint report by Leave Means Leave, Labour Leave and Economists for Free Trade.

The report suggests that some of the poorest households would gain up to £44 as a result of lower food prices, cheaper rents and improved wages due to restrictions on unskilled migrant workers.

The economists rejected a lengthy transitional period or "soft Brexit" models such as membership of the European Economic Area, claiming they represent a "deliberate attempt to frustrate the existing democratic will" in favour of quitting the EU.

There would be no "cliff edge" for businesses, they claimed, "only a change to a more prosperous environment".

The report argues that even without free trade agreements with the European Union - or other nations such as the US, Japan or Australia - the UK would be able to boost trade by unilaterally cutting tariffs.

Setting out why the fall in sterling was "a good thing" it said t he exchange rate shift "will boost net exports and investment by diverting funds from consumer incomes to industrial revenue".

"We are already seeing this in reduced consumption but improving business prospects," the report said.

It also claims that regulations could be slashed in areas such as energy, finance and industrial standards after leaving the EU.

"Free from the shackles of the EU, consumers will be free to buy knobbly pears, to ditch dim energy-saving light bulbs and embrace more powerful vacuum cleaners," the report said.

The economists suggest that the £11 billion a year that had previously gone to Brussels - which Leave campaigners in the referendum suggested could go to the NHS - could be used to provide the Government with a "war chest" for economic stimulus measures such as tax cuts or infrastructure investment.

The report estimates that families on 60% of the £26,000 a year median income will gain £44 a week from Brexit or £2,288 a year, some 15% of their weekly spend.

Leaving the EU is estimated to save them £27 a week in lower grocery prices and a drop in rents triggered by a fall in the value of land.

Wages for the poor are expected to rise £12 a week because of a fall in low-skilled immigration and because of a reduction of £5 a week in costs of migrant benefits.

The poorest 10% of households stand to be £36 a week better off as a result of Brexit, the report claimed.

The suggestion that food prices could fall comes after the British Retail Consortium warned that a "no deal" Brexit could increase the cost of groceries because of extra tariffs and red tape on produce from the EU, which makes up more than three quarters of food imported by the UK.

Home shopping tycoon John Mills, chairman of Labour Leave, commented: "In the referendum, the votes of working class Labour supporters were critical to the success of the Brexit campaign.

"This expert report demonstrates that they were right to back quitting the EU because, this way, they will see a boost to incomes that have been heavily depressed over the last decade."

Economists for Free Trade estimate that through lower regulation and increased global trade Brexit could add 7% to UK GDP, some £135 billion a year.

The Open Britain group, which is campaigning to retain close ties to Brussels, rejected the report.

A spokesman said: "Only a group of hard Brexit fanatics could seriously claim that a weakening pound will make the British people better off, when in fact it has pushed up prices and caused a Brexit squeeze for working people.

"This report is a bad joke produced by a group whose work has been dismissed by the economic experts.

"The hard, destructive Brexit they want to see would leave working people worse off by badly damaging our trade with the European Union, our biggest economic partner."

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