NEWS
03/02/2019 07:26 GMT | Updated 04/02/2019 08:28 GMT

No-Deal: What ‘Project Fear’ Told Us In 2016 Vs What Is Actually Happening Now

Here’s the current state of play...

Writing in his weekly Telegraph column in February of 2016, Boris Johnson resurrected a phrase that had first been coined during the Scottish independence referendum two years earlier – “Project Fear”. 

The Tory MP said the Remain campaign was attempting to “spook” the public into believing “Brexit is simply too scary”. These warnings, he said, were “so wildly exaggerated as to be nonsense”.

Brexit will make you poorer? PROJECT FEAR. House prices will drop? PROJECT FEAR. Thousands of job losses? Nah mate, it’s just PROJECT FEAR – there’s a “world of opportunity” out there.

By April of last year, fellow Brexiteer Jacob Rees-Mogg declared that Project Fear was all but dead, buried and forgotten.

But on Sunday Nissan said it had told staff in Sunderland that it will cancel plans to build its new X-Trail SUV at the plant there, citing Brexit as one of the factors in the decision.

And on Monday, the health secretary was forced to say the government could have to soon prioritise medicines over food. And this came just 24 hours after he said the government considered plans to declare martial law to calm any disorder in the event of a no-deal Brexit. 

With just 55 days to go and a no-deal scenario looking ever more likely, dire Brexit headlines are still appearing, only this time they’re not all warnings – some of them are actually happening.

Here’s the current state of play, as we check ‘Project Fear’’s main projections against our new reality in 2019. 

‘House prices will plummet’

In May 2016, then-chancellor George Osborne warned leaving the EU could cause a drop in house prices of 18% – it didn’t materialise and 11 months later, Nigel Farage was crowing as prices continued to rise.

But Farage may have spoken a little too soon – house prices have yet to plummet but figures released on Thursday suggest potential buyers and sellers are “sitting on their hands” while they wait and see what happens with Brexit.

A house price freeze set in during January, with property values showing near-zero growth compared with a year ago.

Two years earlier, in January 2017, annual house price growth was running as high as 4.3%.

‘You’ll not be able to go on holiday’

In May 2016, the Daily Mail blasted David Cameron after he warned Brexit would drive up holiday costs

The then-PM had said: “If we were to leave and the pound were to fall, which is what most people expect and the Treasury forecasts, that would put up the cost of a typical holiday for a family of four to a European destination by £230.”

The pound did fall in the wake of the referendum and has yet to recover. Before the vote £1 got you around €1.32 but for the last year or so it’s been hovering around the €1.14 mark.

So holidays already are more expensive, proving Cameron right, but the effects of a no-deal Brexit are hard to predict.

There are other factors that might affect your vacation plans – as HuffPost UK revealed on Wednesday, holidaymakers are facing uncertainty after several leading travel insurance firms were unable to guarantee cover in the event of disruption caused by a no-deal Brexit.

After the government told travellers to check directly with their insurance companies about cover in the event of no-deal, the Liberal Democrats contacted seven of the UK’s largest firms posing as a mystery shopper.

Just two of the companies could confirm insurance would be paid out as normal. Another two said travellers would not be covered at all, and the remaining three were unsure about what would happen.

‘We’ll run out of medicine’

As recently as the beginning of this month, Rees-Mogg was certain that any fears the UK could run out of medicines were unfounded.

Speaking on LBC, he said: “We are in control of how things come into this country... This is not particularly complicated.”

But just days later, community pharmacists were saying the uncertainty over no-deal Brexit is already having an impact on their business as issues with supplies are forcing up the price of key medicines.

The lack of political clarity over the UK leaving the EU with or without a deal in six weeks time has left many smaller chemists struggling to plan for the future, with one telling HuffPost UK: “It’s one of the worst times in the industry I’ve ever known.”

Pharmacist Ash Kumar, who works in Maidenhead, said he was already struggling to get hold of some drugs and he had started to stockpile certain key medicines in case they can’t get hold of them in the future.

He said: “Brexit has affected us, most of our suppliers are from the EU and availability is already scarce with prices going up. 

“We are a business at the end of the day and we’re paying out of our own pocket to ensure people get what they need. In some cases we are paying three of four times more for prescriptions than we are being reimbursed by the NHS.”

Even more worrying, it was reported on Thursday by the Guardian that emergency “trauma packs”, the kind used during terrorist attacks, are being stockpiled by the pharmaceutical giant Johnson & Johnson.

‘The banks will leave London’

Warning of a possible exodus of Britain’s banks from London, British Bankers’ Association, Anthony Browne, said in October 2016: “Their hands are quivering over the relocate button.”

The banks are for the most part still in the UK but on Thursday it was announced Barclays has been given the green light to transfer 190 billion euros (£160bn) worth of assets to Ireland.

The banking giant received approval from the High Court on Wednesday for the move, which involves 5,000 clients.

It comes as the company ramps up its Brexit contingency planning.

“As we announced in 2017, Barclays will use our existing licensed EU-based bank subsidiary to continue to serve our clients within the EU beyond March 29 2019 regardless of the outcome of Brexit,” the bank said.

“Our preparations are well-advanced and we expect to be fully operational by March 29 2019.”

The move is designed to deal with the consequences of a no-deal hard Brexit, in which UK based banks would lose “passporting” rights that allow them to function in the EU’s single market, the world’s richest trading bloc.

‘Thousands of jobs will be lost’

Bank of England governor Mark Carney swiftly became the arch-nemesis of Brexiteers as he issued a string of warnings over the possible consequences of leaving the EU, including recession, a plunging pound and severe job losses.

Rees-Mogg even dubbed him the “high priest of Project Fear”.

Firstly, it’s worth bearing in mind that Brexit hasn’t actually happened yet so it’s still too early judge the full economic effects, but one area in particular is showing signs of strain.

The automotive industry is a vital part of the UK economy, supporting over one million jobs and in a worrying sign of the ongoing uncertainty over Brexit, it was announced on Thursday that investment by car companies halved in 2018 to £588 million.

The Society of Motor Manufacturers and Traders (SMMT) said investment had effectively “stalled” amid fears over the UK’s future trading prospects with the EU.

Just over 1.5 million cars left UK factories in 2018, a 9.1% decline on the previous year, and the lowest for six years.

Honda and Jaguar Land Rover have already announced they will pause manufacturing in April and the former recently announced it is to cut 4,500 jobs under plans to make £2.5bn of cost savings.

And Aerospace giant Airbus could slash thousands of UK jobs and move wing-building operations out of the country in the event of a no-deal Brexit, its CEO has warned.

But elsewhere in the motoring world there was positive news – the boss of Rolls-Royce Motor Cars said the brand belongs to Britain and will not move manufacturing elsewhere after Brexit.

‘You won’t be able to get pissed’

OK, so no one actually said this but on Friday it was announced Oddbins has gone into administration, putting 550 jobs at risk if a buyer cannot be found.

The high street booze store cited “deepening unease and uncertainty over Brexit” meant ’consumers are cutting back on spending”

What else is happening?

Ice cream

Unilever announced this week it is stockpiling Magnum and Ben & Jerry’s ice cream in case of disruption to supply chains in the event of a no-deal Brexit.

Speaking to the BBC, Chief Executive Alan Jope said: “We have built inventory on either side of the Channel. It’s weeks of inventory - not months or days.”

In other grocery-related news, a fruit and veg supplier to the UK’s biggest ready meal manufacturers has warned that a no-deal Brexit could spell “disaster” for the food industry as perishable foods would be held up at the border for custom checks.

Kaz Mahjouri, managing director of Nottingham-based Start Fresh, told HuffPost UK that British people would be forced to eat only the food the country can produce, in the short term, meaning root vegetables could be the only fresh produce available in supermarkets.

Sweets

German sweet retailers are worried that exporting products to the United Kingdom will become as slow as molasses after Brexit day on March 29, with new, unclear customs regulations potentially causing supply shortages and price increases.

German gummy bears, chocolate and liquorice are popular sweets in Britain, but aficionados there might have to start stockpiling before the country leaves the European Union.

Beyond shortages and supply delays, the German sweets may become more expensive once they have finally cleared customs and arrived in Great Britain.

And one way to perhaps make some money...

Get into the survival supplies business – one company is offering everything you need “to help you over come Brexit stockpile worries of no food in the shops”, all for just £295.