Britain’s super rich and top earners are the most likely to financially lose out when the UK leaves the European Union (EU), the government’s fiscal watchdog has said.
Bankers, lawyers, and accountants will all be “disproportionately hit by the UK exiting the EU”, according to the Office for Budget Responsibility (OBR).
The OBR, which provides the government with independent economic forecasts, did not explain its claim, The Times reports, but it is thought to reflect possible damage to the city and big, globalised banking.
The Institute for Fiscal Studies (IFS) think-tank highlighted the OBR’s claim. They said the post-inflation pay for the top 1 per cent of earners has been “reeled back in” since the financial crisis and would continue to fall relative to the rest of the labour force.
According to the IFS, people working in finance and living in the South East of England will make up the majority of those affected.
For people being paid more than £105,000 a year, real pay would be 7 per cent lower in 2021-22 than in 2007-08. By that point, pay for the typical UK worker will have almost entirely recovered the lost ground since the financial crash.
The economy as a whole, meanwhile, has been doing much better since the Brexit vote than the government and many of the world’s leading economic think tanks predicted before the referendum.
The evidence that the economy was thriving started building in August last year when it was revealed the FTSE had risen by 8 per cent since the Brexit vote and UK retailers experience their strongest sales in six months.
The economy has not contracted since then and many economic forecasts for the country have been revised up.
Just this Wednesday, the OBR said it now expects the economy to grow by 2 per cent, up from its previous forecast of 1.4 per cent.