The OBR have contradicted Theresa May about the fantasy Brexit dividend being used to pay for the £20 billion per year that will go to the NHS by 2023 (HERE). There isn't going to be one. The key phrases in the speaking notes (HERE) used by the OBR Chairman Robert Chote in presenting the July 2018 Fiscal Sustainability Report, are these:
Brexit is more likely to weaken the public finances than strengthen them over the medium term, via its effect on the economy and tax revenues
But there will of course be savings from the direct contributions to the EU budget that we will no longer have to make
We estimated in our March forecast that the UK would have contributed £13.3 billion to the EU budget in 2022-23 if we remained a member. We expected £7.5 billion of that potential saving to be spent on the withdrawal settlement in that year leaving £5.8 billion to be spent on other things. That would in principle cover a little under 30 per cent of the extra health spending announced for that year, but that ignores other Brexit-related calls on those savings, including commitments the Government has already made on farm support, structural funds, science and regulatory bodies, and possible continued contributions to the EU budget.
While we await more detail, we have assumed here that the extra spending on health adds to total spending and borrowing and is not absorbed elsewhere.
