Most newspapers gave generous coverage to a report by Change Britain today that purported to show that leaving the EU’s Single Market and Customs Union would boost the UK ‘by £450 million a week’. It’s widely acknowledged in think tanks that you can get away with quite a lot if you release something in between Christmas and New Year, because newspapers are so desperate for stuff to write about, so it’s probably not surprising that this got a lot of coverage, including a couple of front page write-ups. The Express ran it as their front page splash, and I think most broadsheets covered it in some way as well.
As I’ve already tweeted, along with Jonathan Portes and a few others, the numbers are basically junk. What’s noteworthy is just how weak they are though. You can read all of the research here in the ’notes to editors’ section.
- The figures come from adding up savings to the UK government from not paying into the EU any more with extra money from exports sold, and savings from regulations we might scrap. Jonathan Portes put it bluntly: “Adding increased exports and reduced government expenditure is literally meaningless. The results mean nothing. It isn’t research, it’s junk.”
- The extra exports figures come from using EU projections about the benefits of trade deals with countries and blocs like India, China and Mercosur, and dividing by Britain’s share of extra-EU trade (15%). This is fairly misleading, because it assumes that the UK could get the same terms as the EU which is unlikely, since the UK is a much smaller economic bloc than the EU, so other countries will be less willing to give us what we want to get access to our market. It’s very much back-of-the-fag-packet stuff.
- As Steve Peers has pointed out, some of the ‘gains’ are calculated on getting a free trade deal with South Korea — but the EU already has a trade deal with them in force, so even if we got exactly the same terms we would just be avoiding a loss, not making any gains.
- The regulatory gains that Change Britain claims will come from leaving the Single Market and repealing some regulations are really, really small — adding £1.2bn to the UK economy as a whole, a fraction of a percent. But even more striking is the fact that £1bn of that £1.2bn comes from a single regulatory change — scrapping the Data Protection Act. This is the Change Britain case for leaving the Single Market, and creating big regulatory barriers to trade between the UK and the EU — all so that we can scrap the Data Protection Act?
- The difference between the high & low estimates for regulation savings is the exact same as the difference between gross and net benefits. In other words, the ‘high estimate’ is based on the premise that these regulations have literally zero benefits whatsoever. Now, they might have greater costs than benefits — that is, they might be bad on net — but it’s absurd to claim that there are no good things about them at all. I have no idea what they were thinking in including this number, because it’s just very misleading.
I say this not to trash Change Britain but to highlight just how weak some of the numbers and claims that are floating around, and being given very kind press coverage, can be. Change Britain has some heavyweight backers — they can do better than this. Whether you’re a hard or a soft Brexiteer, a continuity Remainer or a die-hard Leaver, you should expect better than this.