Don’t bank on Brexit saving Britain billions

March 2, 2016

File photograph shows an employee walking over a mosaic depicting pound sterling symbols on the floor of the front hall of the Bank of England in LondonOne of the advantages trumpeted by those hoping Britain votes to leave the European Union is the savings the country would make in not having to pay the billions of pounds in annual membership.

But according to Capital Economics while the net contribution is roughly 10 billion pounds a year it could be as low as 7 billion.

Peanuts when you compare it to the hundreds of billions of pounds spent annually on the National Health Service or welfare.

Also, as Vicky Redwood, the Chief UK economist at Capital highlights, any savings from a Brexit would not be realised until negotiations were wrapped up until 2018 or later.

She also points out Britain might have to spend some of any savings on activity that EU bureaucrats would otherwise have done such as negotiating new free trade deals with countries.

“Overall, then, while the potential damage to the economy from a Brexit is often exaggerated, it is important not to bank on big benefits from the savings on the UK’s contributions either,” Redwood said.

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