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Irish Government told Brexit effect on economy may be worse than predicted

Debate: Leo Varadkar
Debate: Leo Varadkar

By Hugh O'Connell

The Irish Government is being warned that the actual effect of Brexit on the Irish economy may be far worse than many of the studies and projections published so far predicted.

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The latest official risk assessment, published yesterday, has warned of the potentially crippling impact of Brexit across a wide range of concerns, including business, households, the labour market and the public finances.

The report describes Brexit as "an event without precedent in modern economic history" and therefore quantifying the affect of this is "challenging".

The report warns: "It is important to recognise that such estimates may not capture the full impact, and the figures may be conservative."

It describes the deterioration in the Republic's fiscal balance as being structural, not cyclical, in nature - which in effect means the size of the Irish economy would be permanently affected by Brexit, with knock-on impacts on the amount of tax revenue coming into the Exchequer.

The warning comes as Taoiseach Leo Varadkar visits Belfast today for the second time in less than a week, with Brexit likely to be top of his agenda.

Mr Varadkar will debate Sinn Fein leader Mary Lou McDonald and several Northern Ireland politicians at an event on the Falls Road in west Belfast this evening.

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His latest visit comes just days after he marched in the Belfast Pride parade last Saturday.

Mr Varadkar will face Ms McDonald in St Mary's University College as part of a Feile an Phobail leaders' debate. Alliance leader and MEP Naomi Long, DUP MP Gregory Campbell, and MLAs from the SDLP and UUP are also due to take part in the debate chaired by BBC NI's William Crawley.

The Taoiseach is also due to visit the recently refurbished Hillsborough Castle and Gardens and meet business representatives from the chambers of commerce from the north and south today.

Mr Johnson's government signalled again yesterday that the UK is prepared to leave without a Brexit deal on October 31.

A Downing Street spokesperson repeatedly declined to say if MPs voting no confidence in Mr Johnson's government and forcing a general election or voting to block the UK leaving without a deal would alter Mr Johnson's plans. "The UK will be leaving the EU on October 31 whatever the circumstances. There are no ifs or buts," he said.

Belfast Telegraph