Saturday, June 15, 2024
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Hammond gets it wrong, wrong and wrong again


Spreadsheet Phil has told the Cabinet that if we leave the EU with no deal we’ll have to pay an exit fee of between £30billion and £36billion. This is, apparently, the advice of Treasury lawyers, who think it unlikely that the UK would win any legal battle to withhold payment.

Oh really?

Firstly, international law is less straightforward than, say, UK property law. A pre-trial QC’s opinion in property law is likely to be correct between 60 per cent and 70 per cent of the time (been there, spent the money, had the caveat from the horse’s mouth). Or wrong between 30 per cent and 40 per cent of the time. In many other walks of life, a 3/1 shot is pretty decent odds. To call that unlikely is disingenuous (I’m being polite).

Secondly, while we withhold payment we still have the money. And thirdly, leaving the EU would save a net £8billion or so a year so if we could hang on to the dosh for five years the transaction would be cash neutral (and we would have saved the cost of borrowing it for five years).

Hammond’s conclusion also contradicts a study by the House of Lords (hardly Brexit Central) which concluded that there is no obligation to pay anything, and our Brexit Secretary Dominic Raab who has said that any payment will be conditional upon a trade deal.

Now, I’ve never met Mr Hammond and he did a good job at tidying up the MoD accounts (even if that process has destroyed our armed forces). Unlike many of his colleagues in Westminster he also has had a successful business career, which means that he must be able to count (so can correctly interpret percentages) and understand that legal advice is neither accurate nor reliable. (Let’s face it, government lawyers do not have a recent history of success). So he is making assertions that he knows to be inaccurate in the hope of avoiding the no-deal, no-money Brexit which is Mrs May’s most powerful threat to the EU. That’s called sabotage, or possibly treason.

A stronger Prime Minister, sticking to her manifesto commitments to Brexit, would have challenged Hammond’s legal drivel, got on with Brexit (which means get on with preparing for no deal and making it work) or handed the keys to Number 11 to a more suitable tenant. Mrs May seems to have said or done nothing. Again.

Which is, I suppose, understandable (and possibly even honourable) if she has nothing to say, which looks increasingly to be the case. But it’s no way to lead the country.

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Patrick Benham-Crosswell
Patrick Benham-Crosswell
Patrick Benham-Crosswell is a former Army officer who has spent the last 30 years in commerce. He is the author of Net Zero: The Challenges, Costs and Consequences of the UK's Zero Emission Ambition. He has a substack here. He is the Reform Parliamentary Candidate for Swansea West.

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