Article
In the first of a series of articles on Brexit literature, historian Professor Robert Tombs reflects on a decade on from the Brexit referendum, and looks back at the economic performance of the UK when it was an EU member.
Ten years after the vote to leave the European Union – when the then Prime Minister David Cameron assured the country that the choice was theirs – another Prime Minister and his would-be successors are openly planning to reverse that popular decision. This is intended to be done without another vote, which the present government, hugely unpopular and discredited, could not count on winning. There has never, since we became a democracy, been such a blatant contempt for a democratic decision.
An innocent observer might suppose that such extreme action must have an overriding motive. For ten years, Rejoiners have told the country over and over again that Brexit has caused economic disaster. But the facts prove them wrong. This book shows exactly how and why, by a detailed analysis of reliable and checkable data.
From 2016 onwards, predictions of economic doom have proved false. Contrary to Treasury claims, there was no immediate recession, unemployment surge or collapse in asset prices. Exports did not slump by 40%, productivity and wages continued to rise, and the financial services sector did not implode or decamp en masse to Germany or France. Trade deals old and new – including a deal with the EU - were successfully negotiated or rolled over.
One of the key technical economic issues in the Brexit debate was the impact of Brexit on productivity. Studies claiming Brexit would have, or has had, a big negative impact on UK economic performance have relied heavily on the claim that Brexit would make the UK economy less ‘open’, and that this would cause a sharp drop in productivity. This claim has remained the centrepiece of anti-Brexit commentary right up to the present day. It is the main basis of the often-repeated assertion that Brexit has or will cost the economy 4% of growth. But this book demonstrates that there is little or no evidence in any country of a strong causal relationship from economic openness to productivity – the relationship is more likely to run the other way round. Yet this flimsy argument remains the core of the unrelenting ‘Project Fear’ campaign to bludgeon the public into changing its mind.
The supposed advantages of the ‘reset’ now being undertaken by the Labour government are trivial or non-existent. The trumpeted participation of the UK in the EU’s Erasmus programme is a very expensive way of providing opportunities for European students. As for trade and growth, the long years of membership of the EEC and later EU gave little or no advantage, and in some important areas were actually damaging, as we show. It is clear now that EU membership was never a very good option for the UK. To realign with or even rejoin the EU cannot have a better outcome than during the four decades when we were actually members.
Over the decades, membership became a significant economic drag. The EU’s anaemic growth hobbled UK trade and manufacturing, while consumers saw their standard of living damaged by being induced by the EU’s customs union to buy relatively expensive EU products. Orienting trade towards the EU and aligning with its regulation may have cost the UK as much as 8% of GDP, or £175 billion in foregone output, as we demonstrate.
To restore the drag of EU membership now by bringing about increasing and one-sided realignment with the EU, its Single Market and its Customs Union in the 2020s defies rationality. Returning to full membership would be even more absurd. It would impose large and increasing costs on Britain, including budgetary payments which since Brexit we have escaped, and a tidal wave of new regulation.
What has been our economic situation since Brexit? While UK export growth was sluggish in the first four years after the UK left the EU’s customs union and single market, it was far from disastrous. If there was a temporary impact on UK GDP, it was small at less than 1% of GDP – a small fraction of the claims of a permanent loss of 4%-8% routinely made by Brexit critics. We show that much of the post-Brexit sluggishness in exports was not due to Brexit but to soaring energy costs, and policy own-goals such as the rundown of the North Sea and electric vehicle mandates.
Overall UK trade performance has been resilient since Brexit despite these policy failings. Exports of goods and services to the EU have risen 18% since 2025 with services exports – now almost 60% of UK exports – booming. Measures of the UK’s economic openness have increased since the Brexit referendum, not decreased as Establishment opinion continues to claim. Moreover, the UK is saving at least £12 billion a year thanks to no longer having to pay EU membership fees. Continued claims that the UK has suffered huge losses due to Brexit are created by flawed modelling exercises, coloured by political and ideological bias.
So why is the Labour government planning to overturn a democratic decision by forcing though a change which is almost certain to be seriously damaging both in the short and long term?
Perhaps future historians will be able to solve the mystery. Ignorance must be part of the explanation. How many MPs and ministers have any real understanding of the economy and trade, or take the trouble to acquire it? The actions of the present government, as this book shows, suggest very little.
"Brexit: The Facts Strike Back" is on sale now, - you can get your copy here on Amazon.
