Brexit news: Bank of England predicts post-transition hit to UK economy as deadline looms in EU trade talks
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The Bank of England has said it would pump £150bn into the UK economy and warned that even with a trade deal the lack of preparedness for Brexit would cut 1 per cent from GDP in the first quarter of 2021.
Its Monetary Policy Committee (MPC) based its assessment on the UK striking a Canada-style free trade deal, the prime minister's preferred outcome in the talks with the EU.
With the clock running down before the UK leaves the single market and customs union at the end of the year, significant gaps remained between the two sides in post-Brexit trade negotiations.
The EU’s chief negotiator Michel Barnier said there were still "very serious divergences" after two weeks of intensive Brexit discussions broke up without agreement on Wednesday evening. His UK counterpart David Frost said that they were still working to “find solutions that fully respect UK sovereignty.”
Talks were set to resume on Sunday but major sticking points remained on the “level playing field” regulations, fisheries and a dispute-settling mechanism.
Away from Brexit, Boris Johnson also came under fire from former cabinet minister Rory Stewart, who branded the prime minister an “amoral character” and “the most accomplished liar in public life”.
Drop in taxes collected
Taxes paid in the UK over the five-month period after the arrival of coronavirus were almost £70bn lower than the previous year in cash terms, Whitehall’s spending watchdog has revealed.
Our political editor, Andrew Woodcock, reports:
Coronavirus pandemic leads to £70bn fall in taxes collected
Total take more than a quarter lower than in same period last year, says auditor
Recap: Brexit talks
The UK and EU have failed to achieve a breakthrough following two weeks of intensive talks.
Both sides said on Wednesday “divergences” still remained on key issues.
It is expected that the two sides will remain in contact by videoconference calls, with further talks next week in London.
Additional reporting by PA
However, a leading homelessness charity has said this extra funding is not “extensive” enough.
Jon Sparkes, Crisis Chief Executive, said it was “positive” to see extra support amid lockdown and colder weather creeping in.
“But let's be clear - this funding for 10 areas of the country isn't nearly as extensive as what we saw in March yet the threat from the virus remains the same,” he said.
"We also know the money will run out quickly and that council resources will be under pressure to ensure that they can prevent homelessness and support everyone who needs it into safe accommodation.
Additional reporting by PA
More support for homeless
An extra £15m of funding will be allocated to provide support for rough sleepers and those at risk of becoming homeless over the winter months, the Prime Minister has announced.
The scheme, called the Protect Programme, will help local councils find accommodation for vulnerable people as new lockdown restrictions come into force in England.
PA
Andrew Woodcock, our political editor, has the full story on Dominic Raab going into self-isolation:
Dominic Raab self-isolating after coming into contact with someone who has Covid
Under government rules, foreign secretary must avoid contact with others for 14 days
Foreign secretary self-isolating
Dominic Raab is in self-isolation after recently coming into close contact with someone who has tested positive for coronavirus.
Additional reporting by PA
Brexit and economy
“The outlook for the economy remains unusually uncertain,” the Bank of England said today.
“It depends on the evolution of the pandemic and measures taken to protect public health, as well as the nature of, and transition to, the new trading arrangements between the European Union and the United Kingdom."
You can find more on their projections here:
Bank Rate held at 0.1% and asset purchases increased by £150bn - November 2020
Monetary Policy Summary and minutes of the Monetary Policy Committee meeting
Businesses and Brexit
The Bank of England’s boss has warned businesses feel unprepared for Brexit:
UK and Mexico relations
The two countries are in talks to expand trade relations and tackle climate change, according to the British foreign minister.
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