The government analysis was echoed later in the day by a separate report from the Bank of England, which warned economic output in the U.K. could drop by as much as 8 percent if Britain drops out of the EU without a deal in place, compared to expectations had the U.K. stayed in. That compares to a 6.25 drop during the 2008 financial crisis. [...]
Brexit-supporting MPs were also quick to dismiss the Bank’s analysis, recalling its (so far incorrect) pre-referendum warning that a Leave vote could result in a recession — a prediction that was linked by Brexiteers to an anti-Brexit campaign by the David Cameron government that they branded “Project Fear.” [...]
Likewise, the opposition Labour Party was quick to attack the government. John McDonnell, the Labour party’s shadow chancellor, said: “The Bank has confirmed what other independent reports this week have been telling us: a no-deal Brexit could be even worse than the financial crisis of 10 years ago, and the country would be much worse under Theresa May’s deal. Instead of plowing on with this discredited deal the government should set new priorities that would protect jobs and the economy.”[...]
Regionally, the northeast of England would be the hardest hit economically in a no-deal or Canada-style free-trade agreement scenario, according to the document. Under no deal, the region’s growth would be more than 10 points lower than it would have been inside the EU.
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