The vote to leave the European Union will damage the United Kingdom economy and government finances, the country’s Treasury chief said Monday.
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After more than 60 Tories pledged to vote it down, hwoever, Mr Osborne said any new Budget would wait until at least October, when a new Prime Minister takes the helm.
The chancellor was hoping to calm financial markets, which reacted to Friday’s referendum result by dumping sterling and selling shares in London.
The pound slumped to its lowest level since 1985 on Friday after initially climbing steeply on the back of early suggestions Remain would win. And in my judgement, we should only do that when there is a clear view about what new arrangements we are seeking with our European neighbours.
It is the first public statement by Mr. Osborne, the prime minister’s effective deputy, in the wake of the vote that resulted in defeat for the two men who had campaigned to keep Britain in the EU.
US Federal Reserve chair Janet Yellen will also speak at a European Central Bank conference on Wednesday, where she is expected to predict how Brexit will affect her nation’s economy.
‘I said we had to fix the roof so we were prepared for whatever the future held, and thank goodness we did, ‘ Osborne said.
USA markets are already bracing for another sell off with Dow Futures indicating stocks will open more than 100 points lower this morning, Jarvis added.
Following the Brexit vote, the budget airline predicted “additional economic and consumer uncertainty is likely this summer and as a outcome it is expected that revenue per seat at constant currency in the second half will now be down by at least a mid-single digit percentage” compared to the second half of 2015.
Referring to his interactions with Bank of England Governor Mark Carney, Osborne said, “We have further well-thought-through contingency plans if they are needed”.
Leading “Leave” campaigner Boris Johnson responded to Osborne’s statement, saying “Project Fear is over”.
The Treasury’s forecasts for post-Brexit Britain included predictions that the economy could slip into recession, making every household in the country £4,300 a year worse off.
Pro-Brexit leaders had hoped to hold informal talks with the European Union before triggering the strict two-year timetable for exit set out in the isbon Treaty, but Brussels is hostile to the idea.
Global stock markets lost about tn in value on Friday.
Last week’s referendum “has had an obvious impact on worldwide financial markets”. Scottish First Minister Nicola Sturgeon said she would “consider” advising the Scottish Parliament to try to use its power to prevent Britain from actually leaving the EU.
He was not the only party leader to come under pressure following the announcement; Labour’s Jeremy Corbyn is now fighting off a coup as members of his shadow cabinet resign and consider a no confidence vote. He insists he will run in any new leadership contest, and said he has the support of the party’s grass roots.
In another move to cushion market reaction, Osborne stressed that only Britain can invoke Article 50.
Labour MPs are due to discuss a no-confidence motion against Mr Corbyn.
The IoD said a quarter of its members polled in a survey were putting hiring plans on hold, while 5% said they were set to make workers redundant.
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Prime Minister David Cameron will chair the first meeting of the cabinet since the European Union referendum result.
