A NO-DEAL Brexit could hit the UK economy ‘two to three times’ harder than coronavirus, a think-tank warned last night.
While acknowledging that the impact of Covid-19 would outweigh that of Brexit in the short term, failure to reach a trade deal with the EU would be felt more over time, said the UK In A Changing Europe group.
In a report based on modelling with the London School of Economics, it said: ‘Not even the most pessimistic scenarios suggest that a no-deal Brexit would lead to a fall in output comparable to that seen in the second quarter of 2020.
‘However — assuming a reasonably strong recovery, and that government policies succeed in avoiding persistent mass unemployment — in the long run, Brexit is likely to be more significant.’
Border queues, shortages of fresh food and medicine along with more ‘hassle’ travelling to the continent are also possible, the report warned.
Changing Europe’s director Prof Anand Menon said: ‘While the prime minister said no deal is a “good outcome” our report shows it may lead to significant disruption and will have a significant negative economic impact.’
The transition period with the EU expires on January 1 unless both sides agree to an extension — something Boris Johnson has ruled out. He has set a deadline of October 15 for a deal.
■ BORIS JOHNSON’S controversial Brexit legislation enabling the UK to break international law has cleared a major Commons hurdle after MPs backed a government compromise. Tory backbench pressure forced the PM to agree to amend the United Kingdom Internal Market Bill to give MPs a vote before the government can use powers which would breach the Brexit divorce deal. The amendment was supported without the need for a formal vote.