Brexit latest: Divorce bill could cost more than £39bn as Treasury estimates based on too many uncertainties, says NAO
The final cost of Brexit could exceed current estimates, the National Audit Office has warned, questioning the government’s certainty on the figure of £35-39bn.
While the figure put forward by the Treasury was “reasonable”, the estimate is based on a number of assumptions which could change, leaving the final figure wildly out, the NAO said.
Factors such as the UK’s economic performance in 2019 and 2020, how much EU funding UK organisations will receive after Brexit, the cost of the future pension liability and potential changes to the exchange rate all pose potential variables.
The NAO said even relatively small changes could alter the total paid, forcing the final total up.
And on top of the basic figure, the Treasury’s estimates do not include things like the £2.9bn cost of the European Development Fund.
And the estimate takes into account the £7.2bn income the UK private sector receives from the EU directly, which will not go into the government’s accounts.
Amyas Morse, the head of the NAO, said today: “We have reviewed the Treasury’s estimate of how much the UK will pay the EU under the draft withdrawal agreement. The estimate reflects a number of moving parts, so the range of costs in it could have been wider than £35 to £39bn. But overall we think it is a reasonable estimate.
“As the vote on the draft withdrawal agreement approaches we expect that government will provide a substantial amount of material for Parliament to consider. We will support Parliament in this scrutiny by providing independent assurance.”