JRF warns any Brexit will leave families poorer

6 Sep 18

Brexit will leave British families worse off regardless of what type of deal the UK gets, the Joseph Rowntree Foundation has warned.

As the UK works towards an agreement with the European Union, all potential deals would see an increase in the cost of living and a fall in real wages, the charity said.

Analysis it conducted with consultants Cambridge Econometrics found that even if “favourable” trading arrangements were agreed, there would be negative impacts on living costs and wages.

Of all the possible deals, ‘no deal’ was estimated to have the worst impact on the UK, raising living costs for low-income households by £480 per year, according to JRF.

Campbell Robb, chief executive of JRF, said: “Many people on low incomes backed Leave after being locked out and left behind for too long.

“Since the vote to leave the EU, families have been hit by price rises in the shops, seen their wages eaten up by crippling housing costs and had their tax credits pared back.”

JRF said that Brexit deal would fail to address factors that have contributed to poverty in the UK such as low pay, high housing costs and benefit cuts and freezes.

The analysis looked at the cost of different scenarios such as staying in the single market, like Norway, and compared this with other countries’ trade relationships with the EU, including Turkey, Ukraine and Canada.

JRF graph Brexit costs

Robb highlighted the need for a “bold package of domestic reforms, not just favourable trade terms”.

The charity has proposed a ‘new deal’ for low-income families after Brexit, which includes:

  • building 80,000 affordable homes a year with rents linked to low-income wages.
  • allowing families to keep more of their earnings under universal credit by boosting in-work support such as the work allowance.
  • delivering the shared prosperity fund promised to left behind towns and cities, to create more and better jobs with repatriated EU funding.

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