23 May 2016

Cameron and Osborne warn of ‘DIY recession’

I’ve been to B&Q’s office in Eastleigh to hear the PM and Chancellor warn of a “DIY recession.” I wonder if they cleared that line with B&Q when they booked the venue?

One premise at the heart of the latest government warning on Brexit impact appears to be that so many people will believe the original long-term impact report from the Treasury that, in the short term, they are bound to react strongly and hide their cash under the mattress.

It leads the Treasury to forecast a serious recession but Table 2.C suggests it could be a recession barely meeting the definition starting with four quarters at -0.1% growth.

If there were to be a recession a year from now it might be a rare case of the Treasury forecasting one before we are virtually in it already.

This was a report that had to come out urgently as the purdah period is approaching during which the government is supposed to be gagged and the campaigns fight on a level playing field. We shall see.

B&Q tried to gag their staff after the event when journalists asked for their reaction to the speeches.

The Prime Minister rejected suggestions that he’d wantonly and recklessly steered the nation towards this cliff edge which he said we now stood on.

You can see from Chart 1.F how the referendum’s already having a negative impact according to the Treasury.


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