Ministers clash with Bank of England boss Mark Carney after claiming No Deal Brexit will cause house prices to crash by a third
TWO senior Cabinet ministers clashed bitterly with Bank of England boss Mark Carney yesterday after he warned house prices will crash by a THIRD in a No Deal Brexit.
Home Secretary Sajid Javid and Health Secretary Matt Hancock ripped into the Bank chief after he stunned Ministers in No.10 with a doom-laden briefing.
Invited by Theresa May to speak about preparations for a No Deal, Mr Carney said the Pound would plunge, mortgage rates spiral and house prices crash by 35 per cent in just three years.
Ministerial sources told the Sun that trained economist Mr Hancock immediately hit back at the Canadian to demand to know what his intervention plan was to mitigate the trouble.
The Health supremo asked the governor why he hadn’t suggested an interest rate cut, like the one he swiftly implemented immediately after the EU referendum result in 2016.
The bitter exchange came as Theresa May’s Cabinet met for a marathon three and a half hour session to review the government’s emergency plans.
As tension ratcheted in Westminster, it also emerged that;
- The Cabinet agreed to “ramp up” No Deal planning in a bid to avert any disaster if Britain has to leave the EU without a deal.
- The Government published its second tranche of no deal advice in the shape of 28 more technical papers for businesses and individuals to act on.
- Separately, France’s Europe Minister sparked fury by claiming UK planes and Eurostar trains would be turned back in the event of a No Deal.
The furious exchanges with Mr Carney came just two days after Chancellor Philip Hammond revealed he had agreed to stay on at the Bank of England until the end of January 2020 to ensure a “smooth” Brexit.
Yesterday, the governor again laid bare Threadneedle Street’s grim prediction that a No Deal Brexit could spark a full blown recession.
His doomsday prediction was matched by credit ratings agency Moody’s yesterday – as it warned a fresh squeeze on household living standards could tip Britain into a recession.
But Sajid Javid and Matt Hancock led heated exchanges between several Cabinet Ministers following the startling intervention.
A Cabinet source revealed: “Matt and Sajid took Carney on to demand to know what he planned to do about all his doom and gloom.
“It got quite tasty, but it was all perfectly fair questioning.”
The Cabinet took a series of decisions to implement drastic actions from November onwards if there is still no deal with Brussels.
They include spending hundreds of millions to enact emergency IT systems and infrastructure to manage a stand-alone immigration system and customs checks.
An intensive programme of new laws that would have to be rushed through Parliament to create an immediate new legal framework was also agreed.
The EU currently regulates a series of areas that is planned to continue during the 21 month transition period, from chemical to medicines and farming.
The PM’s official spokesman said: “The Cabinet agreed that no deal remains an unlikely but possible scenario in six months’ time.
“Departments have significantly increased no-deal preparations in recent months.
“Cabinet agreed to further ramp up no-deal preparations in the weeks and months to come to ensure the country is ready for all possible scenarios.”
Furious Downing Street insiders separately turned on France’s Europe Minister Nathalie Loiseau after she torpedoed Theresa May’s attempts to show Britain could go it alone.
Speaking at a conference in London she said it was “correct” to claim UK planes and Eurostar trains turned back from March 30 if Britain fails to strike a deal with Brussels.
In incendiary comments she said: “If we do nothing, and we reach no agreement, this is what would happen.”
She added that while Brexit was the “sovereign choice of a sovereign nation” the remaining 27 EU nations were unified and there was no way any deal on a future trading relationship would be a “win, win” for both sides.
Downing Street refused to deny the French could block planes and Eurostar as it would be sovereign decision.
But the PM’s official spokesman dismissed Mme Loiseau‘s suggestion with derision, saying: “Come on.”
A source added: “If the French really wanted to do this, Disneyland in Paris would take a big knock and so might the Spanish tourist industry. Does anyone really think this is an actual possibility?”
most read in politics
Pro-EU campaign group Best for Britain said the words were a “hammer blow” for the government.
Daniel Zeichner MP said: “This is shocking and shows that Britain faces transport gridlock due to Brexit. Trains and planes could ground to a halt and thousands of people could be stranded.
“Civil servants will be uttering sacre bleu this afternoon over the implications of this shock speech.”
- GOT a news story? RING us on 0207 782 4104 or WHATSAPP on 07423720250 or EMAIL [email protected]