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No-deal Brexit could cost young thousands over their working life, says report

No-deal Brexit could cost young thousands over their working life, says report

A no-deal Brexit could cost young people as much as £108,000 in lost earnings by 2050 – the equivalent of more than £3,000 a year – a new report has claimed.

The total bill for today’s teenagers of a hard Brexit, in which the UK leaves the EU without a withdrawal deal and reverts to World Trade Organisation (WTO) terms, could amount to three times the cost of university tuition fees or twice the deposit to buy their first house, said the report from Our Future Our Choice (OFOC), which is campaigning for a second referendum.

The paper was backed by former prime minister Sir John Major, who said it “sets out with great clarity the implications for young people” and urged MPs to read it.

It calculates total lost earnings by the middle of the century resulting from the impact on Britain’s GDP of a WTO-style Brexit at between £44,000 and £108,000, with the most likely cost amounting to £76,000.

The range for a Brexit with a free trade agreement of the kind preferred by former foreign secretary Boris Johnson was calculated at £30,000-£72,000, with the most likely cost falling at around £51,000.

And a “soft” Brexit which resulted in membership of the European Economic Area was estimated to cost each young person £7,000-£32,000 by 2050, with the most likely outcome at around £20,000.

The report suggested an immediate loss of income from a Brexit based on Theresa May’s Chequers plan of around £400 a year for 18-21-year-olds and £500 a year for 22-29-year-olds, compared with a soft Brexit, rising to £675 for 18-21-year-olds and £830 for 22-29-year-olds under a no-deal WTO exit.

In a foreword to the report, Sir John said that Brexit “was never the choice of the young – who voted overwhelmingly to remain in the EU, while their elders voted to leave”.

Repeating his call for a second referendum on the final deal, he said: “As negotiations have proceeded – and the downsides become ever more clear – the inevitable question arises: how could the UK have voted to enact such a policy of self-harm?

“And how can the fervent Brexiteers remain so deaf, dumb and blind to every single warning – even when those warnings seem ever more likely to be true?

“History may well judge that – for a time – the world’s most pragmatic of nations took leave of her senses.”

OFOC chief spokesman Femi Oluwole said: “This report shows that young people will lose the most from any Brexit deal.

“We are a generation who don’t want to live with Brexit, yet it will cost us three times more than tuition fees, or double the average deposit needed for a house in lost wages and earnings.

“Now that the implications for our generation have become clear, we need a people’s vote on the Government’s Brexit deal.”

The report cited polling suggesting that around 71% of 18-24-year-olds voted Remain in the 2016 referendum and 84% of 18-20-year-olds would do so now.

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