‘Bargain basement Britain’

Jeremy Corbyn has blasted Theresa May’s “demeaning” Brexit plan as one that will create a “bargain basement Britain”.

During prime minister’s questions the Labour leader launched a withering attack on May’s threats to punish Europe by making Britain a tax haven if EU negotiations go sour.

Speaking in the Commons yesterday (January 18) Corbyn told the Prime Minister to “stop her threat of a bargain basement Britain, a low-pay tax haven on the shores of Europe”.

Corbyn said, “It wouldn’t necessarily damage the EU, but it would certainly damage this country – businesses, jobs and public services.

“She demeans herself and her office and our country’s standing by making these kinds of threats.”
 

In response May defended her plan saying “it was a vision that will shape a stronger future and build a better Britain.”

On Tuesday, May laid her plans for Brexit, saying that the UK will leave the single market and reject “punitive” deals from Europe.

She warned politicians on the continent that she could lower corporation taxes to poach business and attract investment, if a favourable deal is not struck.

Despite May’s optimism, the Treasury estimates that replacing the single market with free trade agreements will shrink GDP by 6.2 percent by 2030 – equating to a loss of £4,500 for every UK household.

The Institute for Fiscal Studies predicts that the free trade negotiations, which experts believe will take much longer to complete than the two years Britain has to leave the EU, will cost the public finances between £24bn and £27bn – the equivalent of another year of austerity.

One area of the economy that could be hit particularly hard is the services sector, which accounts for 80 percent of the UK’s GDP and 44 percent of its total exports.

The sector is unlikely to be included in any future free trade deals made with nations outside of the EU, meaning a possible drop in overall trade if services exports to Europe decline.

In 2015 the services sector made £89bn worth of exports to the single market, equating to 40 percent of the sector’s total international business.

In an anticipation of potential economic disruption, HSBC announced this week that it may move operations that generate around 20 percent of its London financial services revenue to Paris. In September, similar proposals were also made by Credit Suisse.

Unite general secretary Len McCluskey said the services sector is just one example of why it is imperative that Britain stays within the single market after leaving the EU.

He said, “Tens of thousands of Unite members’ jobs from manufacturing to financial services depend on open trade with the EU market. To throw that overboard without a thought is to play Russian roulette with our prospects and prosperity.”