The Treasury’s modelling is notoriously dodgy. So dodgy in fact that in 2010 George Osborne set up the independent Office for Budget Responsibility to provide less political analysis than the hyper-political plaything of the chancellor of the day.

Economist Andrew Lilico has pointed out that in its analysis, the Treasury makes three remarkable assumptions.

• Assumes there is no economic gain at all from controlling our own policy compared with the EU doing it.
• Assumes there is no gain from “Future domestic policy choices.”
• Assumes GDP gains from new trade deals with non-EU countries are only 10% of what the EU estimated those gains would be.

These are clearly ludicrous assumptions as no credible economist assumes there are zero economic gains to be made from liberating companies from EU red tape. This further exposes the Treasury as a political tool not a serious economic body.

Guido remembers the Treasury’s bogus analysis during the referendum….

“Britain’s economy would be tipped into a year-long recession, with at least 500,000 jobs lost and GDP around 3.6% lower, following a vote to leave the EU, new Treasury analysis launched today by the Prime Minister and Chancellor shows.”

In February of this year, Cambridge academics concluded that most of the economic impact assessments before the referendum were “flawed”, and that the Treasury’s analysis was particularly bad.

“The short-term forecasts of the Treasury and OECD, which have turned out to be wrong, have further damaged the already weak public confidence in economists’ contributions to public debate.”

Wrong then, wrong now…