Frances Ball 2 Apr 2019 12:27pm

Brexit costs UK £600m a week

A report highlighting the economic impact of Brexit uncertainty on the country, estimates that it has cost the UK around £600m per week since the referendum

This would mean that in the 145 weeks since the referendum the total cost to the UK economy is around £87bn.

The report by Goldman Sachs says Brexit has cost the UK economy 2.4% of its GDP, based on a comparison with its growth before the 2016 referendum. The bank ran a doppelganger study of a hypothetical economy matching Britain’s but that did not experience Brexit shock.

Almost three years after the referendum, the doppelganger economy’s GDP is 2.4% higher than the real post-Brexit figure.

In a note to its clients, reported by Reuters, Goldman Sachs said that political uncertainty had driven economic output losses as investment stalls.

“Uncertainty shocks weighed in on investment growth in the immediate aftermath of the Brexit vote, as well as more recently amid the renewed intensification of Brexit uncertainty,” the note said. 

Yesterday’s second round of indicative votes in the House of Commons failed to find a majority for any one of the four Brexit options tabled. This morning, the Cabinet is in crisis talks.

The British economy would suffer the most in a no-deal outcome, although European economies would also be exposed by it. Goldman currently sees a 15% chance of a no-deal Brexit – but in that scenario UK GDP would fall 5.5%.

Last week, on what was once the original Brexit day, business leaders and experts expressed serious concerns over the fate of business in the UK, emphasising the damage already sustained from uncertainty as well as the risks to future prospects.