Hard Brexit would damage 'almost every sector' of UK economy - report

Leaving the single market would be damaging to almost every sector of the British economy, according to a new report commissioned by an alliance of Tory, Labour and Liberal Democrat politicians trying to stop a hard Brexit.

The study, by the Centre for Economics and Business Research, found every major wealth-creating sector would be affected negatively, with manufacturing hit if there are tariff barriers to EU trade, and the creative industries suffering a “body blow” if there were strict controls on immigration.

The report examines the consequences of leaving the single market in favour of a free trade agreement struck on a modified basis for individual industries.

UK Prime Minister Theresa May has hinted she favours this so-called “sectoral” approach but the CEBR report warns that “all major sectors are linked to the EU and could be harmed if the UK government sought a free trade agreement which prioritised some sectors over others”.

The release of the report comes at a time of growing mobilisation among MPs and political figures trying to stop the UK heading for a clean break with the EU single market and customs union, which is favoured by the most Eurosceptic cabinet ministers and leading Brexit campaigners such as Michael Gove.

The BBC reported that the British government is facing a legal battle over whether the UK stays inside the single market after it has left the EU, citing lawyers who claim uncertainty over the UK's European Economic Area membership means ministers could be stopped from taking Britain out of the single market.

They will reportedly argue the UK will not leave the EEA automatically when it leaves the EU and Parliament should decide. However, the British government has said that EEA membership ends when the UK leaves the EU, the BBC reported.

May has so far refused to reveal her vision for Brexit but gave a rare newspaper interview this weekend, saying she just wanted to “get on with the deal”.