Council report reveals potential cost of No Deal Brexit

Friday 18 October 2019

A No Deal Brexit could add an extra £1.1million to the cost of council services and is likely to have a significant negative impact on people on low incomes, who are likely to be hardest hit by a predicted 10% rise in food and fuel prices.

The stark figures are contained in a report presented to a special meeting of Inverclyde Council’s Environment & Regeneration Committee. The report is based on the Reasonable Worst Case Scenario (RWCS) assumptions published by the Scottish Government.

The RWCS assumes that while there won’t be an overall shortage of food in the UK it is likely there will be a reduction in the choice of products available due to disruption at the EU borders and in the supply chain. The supplies of certain types of fresh food will decrease and this may lead to an increase in prices.

Councillor Michael McCormick, Convener of Inverclyde Council’s Environment & Regeneration Committee, said, “The Prime Minister has negotiated a deal with the EU but there is a major question mark over whether or not Parliament will agree to it. A No Deal Brexit is still a distinct possibility. And the reality of a No Deal Brexit is abundantly clear, no matter what political party you come from.

“The council has already absorbed £3million is cuts so having to find an extra £1.1million would be very difficult. At a time when the council is investing millions of pounds to combat poverty we are looking at a scenario where the poorest people in Inverclyde are likely to be the ones who suffer most.

“The cost estimates are for Inverclyde Council alone and don’t include the overall impact on the wider economy of Inverclyde. The University of Strathclyde’s Fraser of Allander Institute estimates that there could be a 5% fall in the country’s economic output if there is a No Deal Brexit. This would have a similar effect to the 2008 financial crisis.

The Fraser of Allander Institute is a leading academic research centre focused on the Scottish economy.

Councillor McCormick said, “The Scottish Government has set aside £7million for a Rapid Poverty Mitigation Fund to ‘scale up current poverty mitigation measures including the Scottish Welfare Fund’. The most deprived areas are the most at risk to a No Deal Brexit and Inverclyde contains a disproportionate number of the poor and the vulnerable. Inverclyde is amongst the highest areas for deprivation in the Scottish Index of Multiple Deprivation (SIMD) statistics.

 “Leaving the European Union also has the potential to affect public safety by compromising the powers exercise by council officers under a wide range of European derived legislation including: environmental health, food safety and product safety legislation.

“The possibility of a No Deal EU Exit is being treated by the Scottish Government, by local authorities and by the emergency services in the same way that they would approach a major disaster.

“Planning is being led by the Scottish Resilience Partnership (SRP). This group is chaired by Police Scotland and includes representatives of all Category 1 responders including NHS, Scottish Ambulance Service, Scottish Fire & Rescue and local authorities.

“There is no ‘up side’ to a No Deal Brexit but we will be ready for it if it happens.”

Category 1 responders listed under the Civil Contingencies Act 2004 as the front line organisations at the core of dealing with most emergencies.

Page last updated: 18 October 2019