UK finance ministry to publish ‘sober analysis’ of Brexit risk

Thomson ReutersA car sticker with a logo encouraging people to leave the EU is seen on a car, in Llandudno, Wales.

LONDON (Reuters) – Britain’s finance ministry will present a “serious, sober analysis” on Monday of the long-term economic impact if Britain votes to leave the European Union in a June referendum, a source close to the document said.

The report by the ministry, known in Britain as the Treasury, will “show that the hit to the economy of a vote to Leave would not just be temporary, but permanent, because of lower trade and investment”, the source said.

“That means that far from there being more to spend on schools, hospitals and defense, there will be less — billions of pounds a year less. Britain would be worse off for decades to come.”

The latest appeal — led by finance minister George Osborne, an ally of Prime Minister David Cameron — for Britons to vote to stay in the 28-member bloc is likely to spur accusations from “Out” campaigners that the government is using scare tactics.

With Britons divided over whether to stay in the EU, those campaigning to leave, including some of Cameron’s top ministers, have said the government is doing Britain down by saying it cannot stand alone.

But the Treasury’s words chime with other economic institutions, such as the International Monetary Fund, in warning that Britain could deal a damaging blow to the fragile global economy if it votes to leave the bloc.

Last week, Osborne said Britain’s homeowners could face higher borrowing costs if there was a British exit, or Brexit.

The source added about the report: “Every alternative to EU membership has significant economic costs.”

(Reporting by Elizabeth Piper; Editing by Catherine Evans)

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