George Osborne has warned of “tens of thousands” of potential job losses in the financial services industry if Britain leaves the EU, claiming that 285,000 jobs in the sector are linked to business with Europe.
Mr Osborne’s estimates were based on a new Treasury analysis showing around 100,000 financial services jobs were directly linked to EU exports, with another 185,000 jobs reliant on the indirect demand created by that business.
The Treasury analysis was based on official data on the total number of jobs in financial and insurance activities and the latest figures showing that 33 per cent of exports go to the EU.
Xavier Rolet, chief executive of the London Stock Exchange, has said that as many as 100,000 City jobs could be lost if Britain left the EU in a private meeting with David Cameron, linked to moving the clearing of euro-denominated securities out of London.
But Boris Johnson, the pro-Brexit former London mayor, recalled similar warnings when Britain did not join the euro. “Canary Wharf is now far bigger than the Frankfurt financial centre,” he said.
Speaking at an FT125 Forum event on Monday evening, Mr Osborne said financial services accounted for £69bn of exports a year. “A vote to leave the EU would put all this at risk,” he said.
His warning was the latest in an escalating series of claims by the government over the economic risks associated with Brexit.
Mr Osborne also warned that too many company bosses were keeping their heads down in the Brexit debate, saying they needed to speak up to avoid a “catastrophe for business, investment, jobs and incomes”.
He accused his cabinet colleague Michael Gove of wanting to inflict a Brexit “catastrophe” on the British economy with his confirmation that Britain would not seek to be part of the single market.
“That would be a catastrophe for business, investment, jobs and incomes,” Mr Osborne said. “Some people may think wrecking our economy is a price worth paying but I totally disagree.”
Mr Johnson, speaking for the Leave campaign, played down the advantages of membership in the EU’s common market, saying the “so-called economic argument” of the Remain camp was “wholly bogus”.
But he was drawn into controversy when he suggested that the EU’s offer of eventual membership to Ukraine was in some way to blame for the Russian invasion.
“If you want an example of EU foreign policymaking on the hoof and the EU’s pretensions to running a defence policy that have caused real trouble, then look at what has happened in Ukraine,” he said.
Carl Bildt, the former Swedish prime minister, said Mr Johnson was totally ignorant of the facts on Ukraine: “Apologist for Putin,” he said. But Mr Johnson said that he had repeatedly condemned the Russian president’s actions in the Ukraine.
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Meanwhile Matthew Elliott, chief executive of Vote Leave, was accused of using inaccurate figures by Andrew Tyrie, the Tory MP who chairs the Treasury select committee.
Forced reluctantly to give evidence to the committee, Mr Elliott was criticised for Vote Leave’s use of the “bogus” gross figure for Britain’s contribution to the EU rather than the net number.
He was also taken to task for the campaign’s claim that Brexit would remove £33bn of red tape emanating from Brussels.
Mr Tyrie said the figure was “not remotely justifiable” and brought “absurdity” into a debate where the public wanted a serious debate.
Mr Elliott said the £33bn number — covering the cost of 100 different regulations — was produced by Open Europe, a respectable think-tank. It includes regulations such as capital controls on banks, imposed under Basel, which would remain under Brexit.
“I do not think we have suggested that all that money could be spent on other things,” Mr Elliott conceded. “There may be more regulation, there may be some areas where there would be less regulation.”
Open Europe has itself said the £33bn figure is only one side of the balance sheet and is dwarfed by the benefits of the regulations.