Philip Hammond this morning warned that Whitehall analysis has found a no-deal Brexit would cause a hit to the public finances of over £90 billion. It comes despite pledges made by both Conservative leadership candidates to cut taxes and increase public spending, including in the event of no-deal.

The £90 billion of damage to the exchequer would be more than combined annual spending on grants to schools (£50 billion), police (£12.3 billion) and adult social care (£21 billion). The additional borrowing would also be equivalent to a £3,300 hit to each household in the UK.

Liberal Democrat Leadership candidate Ed Davey said:

“This £90 billion Brexit bombshell would blow a hole in the country’s finances when public services are already being stretched to breaking point. It would be equivalent to spending on our schools, police and adult social care.

“Boris Johnson and Jeremy Hunt are both promising to slash taxes and raise spending but it’s now clear that if we crash out of the EU their planned Brexit “war chest” won’t just be empty, they will be bankrupting the country.

“This shows why we need to work together across Parliament to stop Brexit so we can focus on the real issues facing the country.”