Mel Stride: A no deal Brexit would be extremely difficult for our economy
6 min read
As Financial Secretary, Mel Stride is responsible for overseeing the Treasury’s preparations for all Brexit eventualities – including ‘no deal’. With exit day fast approaching, the minister is clear that leaving the EU on ‘WTO terms’ could have severe consequences for the economy. He talks to Kevin Schofield
Mel Stride is reclining in a chair with his feet up on his desk as I enter his spacious office on the ministerial floor of the Treasury. He seems incredibly relaxed for a man with one of the most important jobs in government.
The Financial Secretary to the Treasury is responsible for making sure the UK is as prepared as it possibly can be for the consequences of a no-deal Brexit. He strikes an optimistic tone during our conversation, but it is clear that he views leaving the EU without an agreement in place as a decidedly sub-optimal scenario.
“It would be a bad outcome,” he says decisively. “I’m not one of those people who says ‘don’t worry about it, we’ll trade on WTO terms and it’ll all be OK, a bit bumpy in the short term but it’ll be alright’.
“In the much longer term, inevitably, this country is very resourceful and creative and will go out and find its way and make things work. But in the short-to-medium term, I think it could be extremely difficult.”
Pressed on how long “the much longer term” would be, Stride refuses to elaborate. But it’s fairly clear that he believes the UK would be in for several years of economic pain unless Theresa May manages to find a way to get her deal through the Commons.
But he stresses that it will not just be his department that will feel the pain in the form of smaller tax revenues. The 57-year-old MP for Central Devon also warns that the very future of the United Kingdom could be at risk should a no-deal Brexit happen.
He says: “It’s not just about the economy, it’s also about Ireland and being in a position where we would ostensibly have to have a hard border there. We are not going to impose a hard border, but the EU will presumably be insisting that the Irish government goes in that direction otherwise they damage the integrity of the single market.
“So it’s hard to see how that doesn’t end in a very difficult situation which I think in turn would have knock-on potential consequences for the integrity of the United Kingdom – border polls and that kind of issue, and read-across to Scotland too. So I think a no-deal is not just about the economy but also about the United Kingdom as a whole, so we should do our very best to avoid it.”
Notwithstanding those grim warnings, Stride insists that work is going on across government to ensure that the disruption caused by a no-deal Brexit is kept to an absolute minimum.
“If we end up in that position I think we would be well placed to minimise it,” he says. “Not all of it will be in our control. For example what the French decide to do at Calais will not be something that we can determine, but what we can do at Dover is something that we can determine.
“I’m confident that across government that work is happening – it’s been going on for much longer than people imagine.”
One possible solution to the looming no-deal crisis has been proposed by Yvette Cooper, who has tabled a bill which would give MPs the ability to extend Article 50 by up to nine months. While Stride insists that leaving on 29 March would be the best solution, he does not rule out the possibility that the deadline may need to be pushed back – something the Prime Minister has been at pains to rule out.
“Clearly, no deal will happen in the absence of a deal or an extension of Article 50,” he says. “In one form or another it’s likely to still be on the table. The Cooper amendment is suggesting time for a bill that would say that in the event we didn’t have a deal we would get an extension of Article 50, which is just pushing it further down the road – which, incidentally, I think would be a very bad thing to do unless we really, really have to do it.”
Stride was at the centre of a bizarre row earlier this month when he became the latest minister to be caught displaying potentially sensitive documents in Downing Street. A sheet of paper poking out of a folder he was carrying said: ‘1) No food 2) No Channel Tunnel.’
What made his gaffe even more memorable was the fact that the papers were so prominent and easy to read, leading to some suggestions that it had been done deliberately to warn Tory rebels about the potential impact of a no-deal Brexit. Stride – who jokes that the third bullet-point on the list was ‘The end of the world is nigh’ – insists it was more cock-up than conspiracy.
“It wasn’t done deliberately,” he says “I’d have to be a bit stupid to have done that because it would have been a very crude way of trying to signal an exit that most people would have seen as a bit over the top.
“It was certainly not an attempt to walk around with these five or six words poking out of my folder waiting for someone to photograph me in the hope that it will convince my colleagues to take a different view on no-deal.”
The son of working-class parents who says he owes his success to a grammar school education, Stride is eager for the government to concentrate on things like raising education standards and improving social mobility. But he acknowledges that can’t happen until Brexit is out of the way.
He says: “It’s difficult for any party to cut through anything other than Brexit. I spoke at a business club last night, spoke about various things, but all people wanted to talk about was Brexit.
“One of the reasons why Jeremy Corbyn is not 20% ahead in the polls is because we’ve managed the economy pretty well – record levels of employment, lowest unemployment since the 1970s, real wage growth, getting on top of the deficit. All those good things are going on, but they are being crowded out by Brexit.
“If you go back to the 1980s, one of the good things Margaret Thatcher did was she made commerce and business exciting. It was a time when people wanted to get involved in that sort of stuff. That’s the bit I’d love to stoke up and get going again, but we have to get past Brexit first.”
PoliticsHome Newsletters
Get the inside track on what MPs and Peers are talking about. Sign up to The House's morning email for the latest insight and reaction from Parliamentarians, policy-makers and organisations.
