Senior economists tear apart Rachel Reeves' Brexit blame for economy crisis

Respected senior economists have emerged to condemn Rachel Reeves' attempts to pin blame on Brexit ahead of her second tax-raising Budget next month. Economic experts have said Ms Reeves' excuse-making is misleading, as she attempts to both dodge blame for what most expect will be an unpopular Budget, and direct anger towards Nigel Farage and Reform UK.

In a speech yesterday, the Chancellor claimed: "The OBR, I think, are going to be pretty frank about this - that things like austerity, the cuts to capital spending and Brexit have had a bigger impact on our economy than was even projected back then. That is why we are unashamedly rebuilding our relations with the EU to reduce some of those costs, that in my view were needlessly added to businesses since 2016 and since we formally left a few years ago." However a number of politically neutral economists have since blasted this claim, saying Britain's economic woes happened well before Brexit while Labour were last in power.

Jonathan Portes, professor of economics at Kings College London, told Bloomberg: "The productivity slump has clearly not just been in the UK. Europe has been better, but not much."

Hetal Mehta of St James' Place said Britain's productivity problems "pre-date the Brexit referendum."

Simon French of Panmure Liberum added: "A UK productivity downgrade (which I have my doubts on the wisdom of) was a trend that clearly began in 2008.

"Yes, Brexit had a role by making the UK less competitive, but energy policy, post-[global financial crash financial sector] regulation, housing policy, pension policy, & the legacy of 30Y of low [public sector net investment] would each get equal billing if there was an objective assessment.

"Most economists would defend this government in November if they claimed (rightly) that the latest productivity downgrade is not their fault.

"Fewer would do so if the defence focused only on Brexit."

Official figures from the Office for National Statistics show that Britain's productivity shortfall in 2015 - the year before the Brexit referendum - was already trailing by 18%.

Bloomberg also reports that there is a split within the Labour government about Ms Reeves' planned Brexit blame, with some of the PM's advisers worried about reopening the toxic debate.

Some in No. 10 are concerned that blaming Brexit for Britain's ills will make working-class voters think Labour wants to reverse the referendum result and return to freedom of movement, which would play further into Mr Farage's hands.

Yesterday Lord Frost, the man who negotiated Britain's eventual exit under Boris Johnson, said the state of Britain's economy is "entirely the responsibility of the Labour government".

He wrote on X: "Reeves is talking nonsense. The EU reset is being pursued for entirely political reasons.

"The Government's own figures purport to show that its craven and unnecessary renegotiation will increase GDP growth by 0.02% annually - a £9billion increase in 15 years' time. A rounding error on a rounding error.

"To be balanced against the losses coming from accepting another party's regulations without any say in them, the extra energy costs that come up with a higher carbon tax, the direct fiscal cost of paying to be subject to EU rules, and much else.

"Just as the so-called 4% hit to future productivity is nonsense, so is the idea that the reset does anything to improve the economy.

"The collapse in economic expectations over the last year is entirely the responsibility of the Labour government. No one else."

Ms Reeves will deliver her Budget on November 26.