John Redwood promised the British people a “Brexit dividend” if we quit the EU. The Tory MP and vice president of Conservatives for Britain, also assured them in an interview with the BBC Today Programme, that “our trade is not at risk”. Both remarks are Project Fantasy.
Redwood says a post-Brexit government could fund “all the farmers and universities and others getting European money”, but get back the “ten thousand million” Brussels keeps.
Redwood’s figures don’t include EU grants to the private sector, which includes the money sent to our universities. They also omit EU spending we count towards our foreign aid target. Redwood told InFacts a future government could drop the aid target, so it should count as a saving.
Even if one thinks a post-Brexit government would scrap its aid target, our net contribution is £7.1 billion. But the government is unlikely to see any of that money because Brexit would probably damage the economy. That in turn could mean a drop in tax revenues, causing the deficit to widen not shrink.
Redwood thinks there won’t be such economic damage because “our trade is not at risk”. He told the BBC that the EU “sells us much more than we sell them.” But Britain’s exports to the EU represent 13% of our GDP, while the EU’s exports to us represent just 3% of their GDP. That is just one reason why the argument that the EU needs the UK more than we need it is flawed.
This article was updated on March 29 to correct an error; UK exports to the EU are worth 13% of UK GDP, not 12%
Edited by Hugo Dixon