Treasury Committee 'lands another blow on a falling prime minister'

PUBLISHED: 10:20 11 December 2018 | UPDATED: 10:20 11 December 2018

Prime minister (at time of writing) Theresa May

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An influential committee of MPs has criticised the government for failing to produce any short-term analysis of its Brexit deal and failing to model the Irish backstop.

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The Treasury Select Committee said it was "disappointed" that the Whitehall paper provided an analysis of the "Chequers" plan set out in the prime minister's White Paper in the summer, but not the final deal reached with Brussels, which differed in many respects.

The 83-page document failed to analyse the potential impact of the backstop arrangements proposed in May's deal, or to look at the short-term disruption caused by withdrawal from the EU.

The White Paper scenario set out in the document represented "the most optimistic and generous" interpretation of the Political Declaration agreed with the EU on future trading relations, said the committee in a report.

It cannot therefore by used by MPs to guide their decision-making when May's deal finally comes to a vote, which was due to take place yesterday but has been deferred to a date yet to be fixed.

Committee chair Nicky Morgan asked chancellor Philip Hammond in the summer for "a full and frank assessment of the consequences of implementing the Withdrawal Agreement and future relationship with the EU" before MPs took part in their "meaningful vote" on May's deal.

She said: "The committee is disappointed that the government has modelled its White Paper, which represents the most optimistic reading of the Political Declaration, rather than a more realistic scenario.

"The committee is also disappointed that the Treasury has not analysed the backstop and fails to include short-term analysis of any of the scenarios, including impacts on public finances and on regional and sectoral job losses or gains."

The government document, released on November 28, modelled a range of possible outcomes from Brexit and found that all of them would be worse for the economy than staying in the EU.

Under the White Paper scenario, it suggested that the damage to the economy could be as little as 0.1% of GDP after 15 years, while the harmful impact of a no-deal Brexit could go as high as 10.7%.

But the committee found that the White Paper option modelled by civil servants "does not represent the central or most likely outcome" and therefore "cannot be used to inform Parliament's meaningful vote on the Withdrawal Agreement".

Labour MP Jo Stevens, a champion of the anti-Brexit campaign group Best for Britain, said the committee had "landed another blow on a falling prime minister".

She said: "This report is scathing – calling out the government for error after error.

“The fact that the government won’t do economic forecasts on its deal shows what a mess its plans are. They clearly don’t believe it will be good for the country and want to avoid the embarrassment.

“But the scale of deceit goes further. There’s something shocking and deeply unsettling about a government who refuse to provide parliament with the facts they need before the meaningful vote finally happens. They want the meaningful vote to be meaningless.

“It’s now clearer than ever that this decision needs to be put back to the people, so they can decide whether to push on with this mess or continue with our current EU membership.”

The cross-party panel suggested MPs should instead draw from the full range of scenarios presented in the paper when deciding how to vote, some of which are markedly more pessimistic.

They said that the government should have given an analysis of the backstop arrangement - under which the whole of the UK would remain in a customs union with the EU for an unspecified time after the end of the transition period.

Although May has negotiated an optional extension of up to two years which could take the transition period up to the end of 2022 if no trade deal has been agreed, it remains "feasible" that the UK could enter the backstop, said the committee.

It cited evidence from Bank of England governor Mark Carney that such trade deals take four years on average to conclude, while the EU's free trade agreement with Canada took eight.

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