, 20 tweets, 7 min read Read on Twitter
New @UKandEU rept out today on impact of Brexit vote three years on. We look at four areas: economy and pub finances, fairness, openness, and control. IT is, if I say so myself, rather good. And here's a photo, which serves to let me tag people with gazillions of followers 1/
Oh, and her's the link: ukandeu.ac.uk/wp-content/upl… 2/
First, let me thank all those who contributed, incl: @MeredithCrowle1, @dgbailey, @r_ortegaargiles, @IainBeggLSE, @CSBarnard24, @StevePeers, @alanjrenwick, @nigel_driffield And special thanks to @jdportes and @matt_bevington who basically wrote it then let me put my name on it 3/
The four categories came from a report we published in February 2017, ‘A successful Brexit: four economic tests’, where we set out the parameters for what would make a successful Brexit that all sides could agree on. Read it here: ukandeu.ac.uk/wp-content/upl… 4/
To the report itself. What have we concluded? On the econ and pub finances, the fall in sterling after vote pushed up prices without giving much of a boost to exports, increasing the cost of living. GDP and tax revenue appear lower than they otherwise might have been. 5/
Ongoing Brexit uncertainty has had a negative impact on investment. There has not yet been a rebalancing of the UK’s persist trade deficit and productivity remains far below the pre-financial crisis trend. Not all of these effects are due to Brexit, but it hasn’t helped so far 6/
It seems clear that the Brexit vote had a negative impact on the UK economy, and the prospects in the future don’t look great either, albeit there is a lot of uncertainty. Ultimately, the Brexit trade-off is one of optimal economic outcomes versus sovereignty 7/
On fairness, there has been no significant shift in policy since the Brexit vote to address the ‘burning injustices’ in society. Public services remain under financial pressure from ongoing austerity measures, exacerbated by the fall in EU migration which has hit staffing 8/
There was a sharp fall in real wage growth after the ref. Inflation rose but nominal wages didn’t; real wage growth remains low at just 1%. Large lab market imbalances remain, with the employment rate having fallen in the North-East since 2016 (another photo, more tagging) 9/
Whether Brexit makes the UK economy fairer will depend mostly on government policies not our EU relationship. Public services look set to remain under pressure given negative economic impact we expect from Brexit. Poverty rates have also risen again in recent years 10/
On openness, we conclude that although little has changed in policy terms the UK has become less open since the Brexit vote. This is mostly in terms of the sharp fall in EU migration, resulting from the UK becoming a less attractive place to live and work, and investment. 11/
In terms of trade, the UK has gained from EU trade agreements – namely with Japan and Canada – which have come into force since the vote. The biggest risk lies with services trade, 40% of which goes to the EU and which could face a substantial increase in barriers in future. 12/
Investment fell in every quarter of 2018, with certain industries such as automotive seeing an 80% fall since 2016. Decisions are looming for many car companies about where to build their new models, and continued uncertainty could see that potential investment lost. 13/
Much depends on future government policy as to whether the UK is more or less open as a result of Brexit. Immigration and investment effects could be temporary. Ultimately though Brexit means trade-offs, and leaving the EU means making trade harder with our largest market. 14/
Finally, on CONTROL. This is the area where we think there are going to be clear net gains. ‘Taking back control’ was very much the point after all. However, it will be a gradual reclamation of sole responsibility for areas like trade, migration and regulation, not sudden. 15/
And don’t think the sovereignty issue will go away after Brexit – it won’t. Trade agreements, indeed all international treaties, constrain national sovereignty in some way. As trade agreements deepen globally, their implications for sovereignty will increase. 16/
A bigger question is what the government plans to do with these new powers, and how it intends to distribute them to the parts of the country that feel most excluded. We are yet to have any meaningful proposals on democratic and institutional reforms as a response to Brexit. 17/
Citizens rights’ in the UK will also change substantially after Brexit. Free movement for UK citizens in the EU will end, ending the automatic right to live and work elsewhere in the EU. The constitutional-level protection of human rights provided by the EU Charter fall away. 18/
Finally, we’re no longer going to be paying into the EU on the same scale. The divorce bill will mean little changes until the early 2020s, unless we decide not to pay it of course. However, the economic and reputational fallout of that could outweigh the bill itself. 19/
All in all, quite a lot to take in, and I'd recommend reading the full report (which, don't worry, is still quite short). Here's a little summary to whet your appetite. Address all compliments to me. All disagreements to @jdportes /END
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