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SNP warns no-deal Brexit leaves Scottish economy facing devastation

Scotland’s economy faces “devastation” over the escalating prospect of the UK crashing out of the EU without a deal on trade or future relations, the SNP has warned.

Such a scenario would plunge the UK into a state of “national emergency”, one senior UK government minister said yesterday, and lead to problems with medicines and food supplies.

The warnings came after the new Brexit Secretary Dominic Raab admitted the government is preparing for “any and every eventuality” if a deal cannot be reached with Brussels when the UK leaves the EU next March. Senior Tory figures admitted the party is being “torn apart” by Brexiteer MPs who want a “no deal” scenario to ensure all ties with the EU are cut.

Brexiteers insisted yesterday that the failure to strike a deal with the EU could present an economic “boom” for British industry, freeing the country from tariffs that are imposed as part of the EU customs union.

Mr Raab said Britain could withhold its £39 billion divorce bill if it did not get a trade deal and branded Brussels “irresponsible” over claims that UK citizens living in the EU could face an uncertain future after Brexit.

“We ought to be trying to reassure citizens on the continent and also here,” he said. “There is obviously an attempt to try and ramp up the pressure.”

The respected Fraser of Allander think tank has warned that Scottish growth would shrink by 5 per cent below expected levels if the UK was forced to revert to World Trade Organisation (WTO) rules outside the Brussels block.

Wages would also fall £2,000 annually, with the number of people in work 80,000 below that expected if Scotland stays in the EU.

Former Scottish Rural Affairs secretary Richard Lochhead warned that no deal would be a disaster for Scotland.

“Tory Brexiteers are leading the charge to a Brexit that will inevitably leave us poorer and betray the interests of ordinary people,” he said.

“Falling back on WTO rules in a no deal Brexit would be the worst of all possible worlds – cutting Scottish GDP growth by 9 per cent and devastating Scottish trade, with our world-class quality meats, Scotch whisky and salmon industries potentially facing rafts of unnecessary tariffs.”

Boris Johnson and David Davis resigned as Foreign Secretary and Brexit Secretary over Prime Minister Theresa May’s recent Chequers agreement amid concerns that it gave away too much to the EU.

Mrs May was forced to amend the agreement to meet the concern of Brexiteers in the House of Commons. There are growing fears this deal could be rejected by EU negotiators or a compromise agreement would not get through parliament, leaving the UK in “no deal limbo”.

Former Prime Minister Sir John Major yesterday warned that the campaign being waged by Brexiteer MPs to keep the pressure on Mrs May over the terms of departure form the EU could have “catastrophic” consequences.

He warned: “If every compromise reached by the Cabinet is blocked by this minority of irreconcilable, hard-line, utterly committed anti-Europeans, anti-Europe on all occasions – then we will not actually get to negotiations, we will fall out without a deal, and it will be catastrophic – damaging for Europe – but catastrophic for us, and not only catastrophic for us – it is the people who have least who will end up being hurt most.”

The strife within the Tory party over the issue was set out by leading remainer Dominic Grieve, the former Attorney General.

“We have introduced an ideological issue into our party with Brexit, which is tearing us apart,” he said.