Chancellor claims Lib Dems ‘made up’ figures which show economic hit from no-deal Brexit

Chancellor Sajid Javid answers Treasury questions. Photograph: Parliament TV. - Credit: Archant

The chancellor has tried to accuse the Liberal Democrats of ‘making up’ warnings about a no-deal Brexit, despite the fact they quoted an Office for Budget Responsibility report.

Speaking at Treasury questions, Ed Davey called on Javid to “tell the truth” about the impact of a no-deal exit on the health service, schools and police.

Liberal Democrat former minister Sir Ed Davey highlighted the “alarming” fiscal analysis of a no-deal Brexit compiled by the Office for Budget Responsibility (OBR).

He noted: “Even in its least damaging no-deal Brexit, the OBR predicts a hit to Britain’s finances that would destroy every single spending announcement by the prime minister and the chancellor.

“Given that, isn’t it unacceptable for a chancellor and a government to be publicly contemplating a no-deal Brexit, to fail to tell the truth to the British public that spending on health, schools and police will be slashed in the event of a no-deal Brexit?”

Javid replied: “I don’t recognise that picture at all, it’s one just made up by the Liberal Democrats.”

A day earlier when Javid was asked about the OBR report, Javid said that nobody could sure of the true cost of a no-deal Brexit.

Shadow Treasury minister Jonathan Reynolds warned that the government cannot deliver everything it is promising on Brexit, and via its spending commitments.

He said: “The government’s current policy is that we can have higher public spending, falling debt and a no-deal Brexit.

“But those three things are impossible to deliver together.

“So on which of them is the government not telling the truth?”

Javid replied: “This government is focused on leaving the European Union on October 31 and we are trying to do that with a deal, and if we don’t we’ll leave with no-deal.

“He talks about the government’s policy – at least this government has a clear policy on Brexit. What’s the policy of the Labour Party?”

Labour’s Helen Hayes said there is “evidence of a rise in short positions being taken out against the pound” before adding: “Is the minister confident that the hedge funds taking those short positions, some of which have donated to the prime minister’s leadership campaign and to the Conservative Party, have no inside information about the planning or timing of a no-deal Brexit?”

Javid replied: “That really is such a ridiculous suggestion and it doesn’t deserve an answer.”