Brexit: Bank Of England Warning

Mark Carney’s downbeat assessment yesterday confirms what everybody knows; the economy is slowing, incomes are not keeping pace with inflation and Brexit uncertainty is beginning to bite. Quickly the Brexiteers rush to the airwaves to denounce the governor whose forecasts, like everyone else’s, are often wrong. Meanwhile growth is picking up in the US, the EU and all across the world. But not in jolly Brexit Britain.

The crunch is this. It is now clear to the world that the government does not really know what it is doing over Brexit, what it will agree to and how it all will be implemented. Meanwhile although manufacturing and exports are up because of the falling pound, investment, to back the drive for exports and the restoration of home manufacturing capacity of the stuff we use, is just not happening. But the downside, falling purchasing power and rising inflation, is.

It is not clear whether we will be in or out of the customs union, or if that is clear, what the terms will be. The possibilities promoted by various competing members of the befuddled Cabinet vary from cliff edge to tariff free and on every other issue associated with this disaster there is absolutely no clarity at all. So no wonder investment has dried up.

It should not be like this. There should be a huge programme of government investment in a major economic reboot to guarantee that whatever the final outcome, the UK economy is on the up and able to exploit whatever opportunities appear. Business should be given the confidence and the clarity that will drive record investment, new start ups, home manufacturing, innovation, the list is endless.

This surely be the most feckless government since 1945. Whatever your politics and whether you are Brexit or Remain, it has been obvious for years that there are structural problems with the shape and delivery of our economy and even without the referendum, urgent reform was called for. Now we are embarked on an adventure in uncharted waters, we must deal with these issues so as to be able to make the very best of all the opportunities that the changes will bring, as well as cope with the worst of the things which will inevitably go wrong. Any government that does not drive this is not fit for purpose.