The models used to assess the economic impact of Brexit were misleading, according to new analysis by Dr Graham Gudgin, Policy Exchange’s new Chief Economics Adviser and the co-author of the report. At the time, the projections made by the Treasury, OECD and IMF were used by the then government and Remain campaign to argue that the British economy would face a significant and permanent loss of income in the event of a vote to leave. A careful analysis of the gravity trade economic models used to generate these pessimistic projections suggests that the impact of Brexit on our economy will be much less significant than the economic consensus constructed at the time of the referendum.

In this major new report — by Policy Exchange’s Head of Energy and Environment, Richard Howard, alongside Matt Rooney, Zoe Begherbi, and David Charlesworth — the case is set out that the Government must take more action now to tackle the twin problems of greenhouse gas emissions and air pollution from road transport. Amongst other key findings, the report’s analysis reveals that hitting carbon targets will leave a £9-23 billion p.a. hole in tax receipts by 2030, and that official estimates of vehicle emissions and fuel efficiency are highly misleading.

Dr Gunnar Beck — a Visiting Scholar at Policy Exchange’s Judicial Power Project — responds to German Vice Chancellor and Minister for Foreign Affairs, Sigmar Gabriel’s apparent signal that the EU might be willing to ‘relax some of its more extravagant demands’ in the Brexit negotiations. Beck concludes that while Gabriel’s proposal for a transnational EU-UK court is a ‘promising starting point for the negotiations’, the UK ‘needs assurance that its future legal relationship with the EU [will be] governed by the greatest possible legal certainty and overseen by a court which ensures that words mean what they say and not simply whatever it may be that best suits the European Union’.

Geoff Raby, Policy Exchange’s Head of Trade Policy, welcomes the latest pronouncement of Philip Hammond’s in favour of the UK still leaving the Customs Union — but notes that the Chancellor hinted that there might be a transitional arrangement to remain inside it. Raby points out the potential perils in this stance, not least of which is that transitional arrangements could solidify into permanent ones.

Policy Exchange is delighted to announce that our next Chairman of Trustees will be Alexander Downer, High Commissioner of Australia – who was previously the country’s longest serving Foreign Minister between 1995 and 2007. He will take over later this year when he retires as High Commissioner. Downer will succeed David Frum, who stands down after completing his term as Chairman; General Sir Peter Wall is acting Chairman until then.

Policy Exchange is delighted to congratulate Professor John Bew, Head of our Britain in the World project, after his outstanding biography of Clement Attlee last night won the prestigious Orwell Prize.