Think tank did not say GDP per capita will fall by 7% under Boris Johnson’s deal

“Mr Johnson’s plan is also a much harder Brexit than Theresa May’s.”

“GDP per capita would fall by up to 7% in 10 years, says the UK in a Changing Europe think-tank.”

Daily Mirror, 17 October 2019

Today, the Mirror cited analysis by think tank UK in a Changing Europe, claiming it said GDP per capita would fall by 7% over 10 years under the Prime Minister’s plans for an EU withdrawal agreement.

This misses crucial context, meaning it’s misleading. UK in a Changing Europe said that GDP per person would grow by 7% less under Boris Johnson’s deal after ten years compared to a scenario where the UK remains in the EU and maintains the status quo. It did not find that GDP would fall by 7% over the ten years.

That could well mean that the UK economy still grows over this period, but more slowly than if we remained in the EU. This isn’t the first example of people wrongly assuming that forecasts of Brexit’s negative impact on GDP equate to a fall in GDP compared to where it is now.

UK in a Changing Europe wrote: “[We do not] attempt to forecast how much the UK economy will grow over the next ten years.

“Rather, we address the narrower question of the change in the UK’s income per capita if the future relationship with the EU were based on Mr Johnson’s proposals.

It’s worth noting that UK in a Changing Europe modelled numerous scenarios. A 7% fall in GDP per capita is under a system where the UK has a restrictive migration policy and productivity is affected.

The scenario in which GDP is least affected is where there is a liberal migration policy and productivity is not affected. This, UK in a Changing Europe estimates, would reduce GDP by 2.3% over a ten year period compared to remaining in the EU.