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19 June 2018

Why you’ll be hearing the words “Brexit dividend” an awful lot over the next year

It’s a useful lie, and not just for the Conservatives.

By Stephen Bush

Say it with me one more time: there is no Brexit dividend. 

It could be that, at some point in the future, almost everything we believe to be true about trade turns out to be wrong and the economic costs of Brexit no longer outweigh the gains, but even if that does happen, a Brexit dividend in 2027 won’t be able to finance an increase in the National Health Service budget in 2018.

But the lie that it does exist is beneficial to essentially everyone at Westminster. For Theresa May, it makes the combination of tax rises and extra borrowing that will actually fund the NHS politically palatable for the Tory right. For the Liberal Democrats, it is a good opportunity to pop up and remind everyone that if your reaction to the words “Brexit dividend” is to get very, very angry there is only one party for you and it is the Liberal Democrats. For the SNP, it is a good illustration of how politically bankrupt Westminster has become.

And for Labour, it gives them a response to the government increasing NHS spending other than “Oh no, you have shot my fox”. The Labour leadership’s private view, that the spending announcement helps them as it “moves the window” as far as the acceptability of more borrowing and public spending goes, may well be true, but isn’t a very good talking point for shadow frontbenchers. But the line that the Brexit dividend is nonsense is a good talking point for the opposition.

Which is why, bizarrely, the dividend lie is pretty good politics for almost everyone.

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