Households are £404 a year worse off due to Brexit, study finds
A study warned of the impact of rising inflation.
Households are more than £400 a year worse off as a result of Brexit, an economic study has found.
The report published on Monday revealed that the average household is paying £404 a year extra due to price inflation.
The impact of price increases due to the referendum is equivalent to a £448 cut in annual pay for the average worker, the equivalent of one week’s pay.
Published today by @CEP_LSE : 'The Brexit Vote, Inflation & UK Living Standards' - a new analysis by researchers from @UKandEU Economics of #Brexit team https://t.co/s8iU2MZCEx pic.twitter.com/hT9jyvTR4d— CEP@LSE (@CEP_LSE) November 20, 2017
Dr Thomas Sampson, who co-authored the Centre for Economic Performance research, said: “Even before Brexit occurs, the increase in inflation caused by the Leave vote has already hurt UK households.
“Our results provide compelling evidence that, so far, UK households are paying an economic price for voting to leave the EU.”
Dr Sampson’s research revealed that the rise in inflation has been lowest for households in London while Scotland, Wales and especially Northern Ireland have been worst hit.
According to the report the largest inflationary effects have been on product groups with high import shares.
These include bread and cereals; milk, cheese and eggs; coffee, tea and cocoa; beer and wine; furniture and furnishings; and jewellery, clocks and watches.
The rise in food prices has led think tank the Food Foundation to raise concerns that “five-a-day” may become unaffordable for millions of Britons.
In a new report the foundation has claimed that in a no deal Brexit scenario price rises would mean the poorest 10% of the population could spend half of their entire food and drink budget to meet current Government guidance for fruit and veg.
The report goes on to identify 16 of our 50 favourite fruit and veg which could be grown more in the UK, meaning less reliance on imports and more competitive prices.
Anna Taylor, executive director of the Food Foundation, said: “The Government faces a clear choice to boost British harvests of fruit and veg or the NHS will reap the consequences.”
New @ONS inflation data shows concerning rise in veg prices. Government urgently needs to build resilience against price rises into the ag bill! #peasplease @Laura_Sandys @KerryMP @K_Kerridge @BritishGrowers pic.twitter.com/N1A2eaWz6o— Food Foundation (@Food_Foundation) November 14, 2017
She added: “It is absolutely crucial that the Government grabs the bull by the horns before the Brexit boat sails.”
Liberal Democrat leader Sir Vince Cable said: “This comprehensive study finally nails the lie that the Brexit process has not damaged the economy, and with it the living standards of every British citizen.
“The average household simply can’t afford to lose £404 a year at a time when many have not recovered from the financial crisis of almost a decade ago.
“But it didn’t have to be this way: if the Conservative government had responded by guaranteeing that Britain would remain in the single market and customs union, the pound would not have fallen so sharply and inflation would not have risen.
“That was not the fault of how people voted but how the Government responded to the vote, embarking on the most extreme and damaging version of Brexit.”