Brexit will make people outside London worse off, two reports have found.
Household bills will rise by between £245 and £1,961 a year after Brexit, with a disproportionately adverse impact on lower-income groups and people in Northern Ireland, Wales, the Midlands and the north-east, they say.
The Institute for Public Policy Research found a hard Brexit would hit those out of London the most because household spending patterns involved more goods and services that will be hit by price rises.
“Our findings suggest that post-Brexit price rises will squeeze incomes more in parts of the UK outside London,” said Marley Morris, IPPR senior research fellow.
Wales and the north-east were most at risk because of their disproportionate reliance on producing goods and food for export to the EU including Welsh lamb, Airbus wings, and cars.
Flintshire, Wrexham, Sunderland, Telford, Wrekin, south Derbyshire, the home of Rolls-Royce, west Derbyshire and Luton were also identified as potential losers. “All income groups, including the poorest, will face negative impacts,” said the IPPR.
A second report by consultancy Oliver Wyman reached similar conclusions. It modelled post-Brexit costs on a basket of 150 imports and found that prices would rise for all consumers regardless of income or where they lived.
But in poorer areas the impact of increased costs in goods that attract higher tariffs such as meat and dairy products would be greatest because a greater proportion of household income would go on weekly shopping bills and transport, for example.
It calculated that almost £1,000 a year would be added to household spending under the worst-case scenario of a hard Brexit, which it said would cause significant red tape and have World Trade Organization tariffs and increased labour costs.
It assessed the supply chain costs for all 150 goods, analysing everything from tariffs to non-tariff barriers such as transport, rules of origin certificates, pre-shipment inspections, delays and administration. It also looked at the cost of labour in each region.
The price of a restaurant meal would go up because of increased cost of imported food and labour because of…
