Chancellor may suspend trading on stock exchange if vote fails to go his way
GEORGE OSBORNE has refused to rule out suspending trading on the London Stock Exchange on Friday if Britain votes to leave the European Union.
The Chancellor also suggested that redundancy notices could be issued hours after a referendum vote to leave the EU.
The comments from the Chancellor, made in an LBC radio interview yesterday evening, after the market had closed, could force shares down this morning.
Iain Dale, the presenter, asked Mr Osborne: “If the financial markets do plummet on Friday would you have to consider suspending trading on the FTSE?” He responded: “Well look, the Bank of England and the Treasury – Governor Carney and myself – we have of course discussed contingency plans.
“But the sensible thing is to keep those secret and make sure you are well prepared for whatever happens, but if you set them all out in advance then you rather undermine the power of those plans.” Pushed again, Mr Osborne said: “I have a responsibility to the people listening to this programme to do all I can to protect them. “But I have to tell you that you cannot in the end protect people from the economic shock that leaving the EU would bring about.”
He refused to say how many Treasury civil servants were working on the plans, but said they were focusing on the “financial stability consequences for the immediate aftermath” of Brexit. He stressed that in the longer term there was “no plan” for what would happen after Britain left the EU. Mr Osborne pointed to warnings from the London Stock Exchange that there would be 100,000 job losses in the City after Brexit. Asked whether redundancies could come as early as Friday – the day after the referendum, he replied: “I think that will start to happen very quickly, sadly.”
In the 30-minute interview Mr Osborne warned of a flight of capital from the UK if Britons opt to leave. He said: “On Friday morning you will see the first reaction in the financial mar- kets because they’ve placed all these bets that they will move money out of Britain if Britain votes to leave.”
Mr Osborne also pledged for the first time to veto Turkey joining the EU – going further than David Cameron, who dodged the question three times during a TV appearance earlier this week.
“If Turkish membership came up today we would veto it because they have not completed any of the things that are required for Turkey joining the EU,” Mr Osborne said.
Liam Fox, the anti-EU former Tory defence secretary, said: “He would not be saying this if he didn’t think that we might vote to leave. So that in itself is a boost to the Leave campaign. But any attempt by the Treasury to threaten the well-being of the economy is an unacceptable abuse of power.”
Mr Osborne’s comments follow a stark warning issued by business magnate George Soros last night, who argued that Brexit could see the value of sterling plummet by more than 15 percent, as the financial markets brace for the prospect of a crisis rivalling Black Friday in September 1992.
Separately, analysis from Economists for Brexit said unskilled EU migrants cost UK taxpayers £6.6 billion a year.