George Osborne has said Britain will face a “long, costly and messy divorce” if it leaves the EU, as he promised to publish a full cost-benefit analysis on Brexit.
Pro-Brexit Tory MPs lined up to pour scorn on the chancellor’s arguments, with Jacob Rees-Mogg questioning how he could paint such an “apocalyptic view” when the prime minister was only recently saying he did not rule out campaigning for the UK to leave.
Meanwhile, there were reports that Downing Street officials have urged European politicians to think twice before publicly belittling the deal David Cameron secured in Brussels.
The Politico website said Daniel Korski, a senior No 10 adviser, told EU diplomats their politicians should not criticise Cameron’s reform package. It also suggested he urged them to consult Downing Street prior to any speeches that might have an impact on the UK debate.
The prime minister’s spokeswoman did not deny the report. “No 10 staff regularly meet with diplomats around the world,” she said. “We wouldn’t go into private discussions.”
It is thought that Downing Street is having similar conversations with the White House, with an intervention by Barack Obama expected in April.
Osborne told MPs: “We have already seen sterling fall, and HSBC yesterday predicted a further 15-20% slump in the event of a vote to leave. The finance ministers and central bank governors of the G20 concluded at the weekend that a British exit would cause an economic shock not just to the UK but to Europe and the world.
“What people are asking for in this referendum campaign is a serious, sober and principled assessment from the government setting out the facts, and I can announce today that the Treasury will publish before the 23rd of June a comprehensive analysis of our membership of a reformed EU and the alternatives.
“It will include the long-term economic costs and benefits of EU membership and the risk associated with an exit.”
The chancellor went on to cast doubt on whether the UK could export cars free of tariffs without paying into the EU and accepting freedom of movement.
The chancellor faced criticism from Tory backbenchers while Labour MPs asked a string of supportive questions about the EU’s role in stopping tax avoidance, its importance to the steel industry and small business start-ups reliant on funding from Brussels.
Earlier on Tuesday in a speech on Europe, Peter Mandelson issued a warning about the impact of Brexit on trade, which was quickly dismissed by out campaigners.
Matthew Elliott, the chief executive of Vote Leave, said: “Peter Mandelson told us the British economy would fall off a cliff if we didn’t join the euro and now he is indulging in the same scaremongering about the referendum. He was wrong then and he is wrong now. He is starting to resemble a man wearing a sign saying the ‘end is nigh’.”
