Car manufacturing, farming, financial services and the lives of millions of Britons living in Europe will all be affected as the UK takes 10 years to extricate itself from the EU, an official report says.

The government’s first official analysis into how Brexit would unfold in practice says a decade of uncertainty would hit “financial markets, investment and the value of the pound”. It also warns that the rights of 2 million British expats to work and access pensions and healthcare in EU countries may no longer be guaranteed.

Written by civil servants in the Cabinet Office, and seen first by the Guardian, the document says it would not be feasible to leave the EU within the two-year time frame stipulated by existing treaties. “A vote to leave the EU would be the start, not the end, of a process. It could lead to up to a decade or more of uncertainty,” they concluded.

The 10 years cited in the report includes the time it would take for Britain to exit the EU, to set up a new trade and related agreements as well as negotiate fresh trade deals with the US and other countries. The document says they would only be completed at the end of a three-stageprocess that will be triggered in June if Britain votes to leave the EU.

Out campaigners have accused the government of launching “Project Fear” and claim the riskier scenario for Britain is staying inside the EU. They compare extreme warnings to those made when Britain was considering joining the euro.

Chris Grayling, the leader of the House of Commons, who is one of five cabinet ministers campaigning to leave the EU, dismissed the idea that it would take twice as long as the second world war to negotiate new arrangements.

Grayling said: “People will not be impressed with this relentless campaign of fear. Claims that it will take twice as long to sort out a free trade deal with the EU as it did to win world war two are clearly ludicrous. There’s a free trade zone from Iceland to the Russian border and Britain will still be part of it after we Vote Leave.



“The in campaign claims we have no real choice other than giving away more power and money to the EU every year. It isn’t true. The real uncertainty is voting to stay in an EU which is already struggling with the euro crisis, the migration crisis, and a youth unemployment crisis. It is safer to take back control and spend our money on our priorities.”

Iain Duncan Smith, the work and pensions secretary, said the European migration crisis posed a larger threat to the UK than Brexit. “Why would we have such a low opinion of the British people that we go out and talk about ‘leaping into the dark’, we talk about ‘profound shocks’?” he asked on the BBC’s Andrew Marr Show.

He added: “The in campaign’s whole strategy seems to be about basically saying we’re too small, we’re too little … This country is the greatest on earth.”

Monday’s report claims that the process by which Britain would leave the EU would be complex and grinding, with other European countries trying to extract as much as possible.



It says the only legal way to withdraw from the EU is through article 50 of the treaty of the European Union. But it argues that there is no precedent for this and that Britain would be unlikely to achieve a successful negotiation in the two-year time period it sets out.

Extending the process would require the unanimous agreement of all 27 of the other EU countries – and could result in states pushing for concessions, it says. Meanwhile, a new agreement on trade and wider co-operation might require ratification in some national parliaments.

“The UK’s withdrawal from the EU would mean unravelling all the rights and obligations – from access to the single market, to structural funds for poorer regions, to joint action on sanctions – that the UK has acquired both during our accession to the EU and over our 40-year membership. As well as negotiating its withdrawal, the UK would also want to negotiate its post-exit arrangements with the EU,” the officials claim.

The report details a number of issues that would have to be resolved in any Brexit negotiations, including access for UK citizens to the European health insurance card, cross-border security arrangements, the rights of UK fishermen to fish in non-UK waters, including in the North Sea, and access to the agency that monitors the safety of medicines.



The government argues that British trade would also be plunged into uncertainty as it would become necessary to renegotiate individual deals with more than 50 countries that have an arrangement with the EU.

The report says the UK will be “constrained” in its ability to secure those agreements until the first round of Brexit negotiations are complete. It suggests that the US might not even enter talks with the UK before concluding its own agreements with the remaining EU countries.

Matt Hancock, Cabinet Office minister, said: “This government analysis shows that leaving the EU would lead to a decade of damaging uncertainty. The risks to our economy are clear and would leave the jobs and prosperity of the British people dangerously exposed.”

The report does not give a timescale for when article 50 would be triggered but David Cameron has suggested it would be straight away. It also does not mention a second referendum, which sources say is not on the table.

The report could fuel anger in the Conservative party about the way in which the referendum is being fought. Conservative out campaigners are already unhappy that Sir Jeremy Heywood, the cabinet secretary, has told Whitehall officials not to show papers relating to the EU to ministers campaigning to leave.

There have also been reports that Tory ministers and backbenchers have warned Cameron that he could face a leadership challenge whatever the outcome of the vote on 23 June if he does not tone down attacks on Boris Johnson and other Eurosceptics.

Conservatives are able to campaign on both sides, but many are concerned about the scale of “blue-on-blue” attacks.

It comes as John Howard, the former Australian prime minister, said he thought there was a strong case for Brexit – telling the Australian media that the EU was a “fundamentally flawed concept” that threatened the sovereignty of its members.

The Britain Stronger in Europe campaign also responded, mocking the leave campaigns for failing to say what economic model the UK would follow in the case of Brexit. They say countries outside the EU, which “include Vanuatu, Nicaragua, Peru and Macedonia” are among those that Britain might emulate if it were to leave.

Matthew Elliott, the chief executive of Vote Leave, said: “People will not be impressed with David Cameron’s relentless campaign of fear. We are optimistic about Britain’s future but the government seems intent on doing Britain down. The UK will thrive outside the EU – just like every other country in the world.”

The Leave camp is seeking to turn the tables on Downing Street by warning that remaining in the EU represents the riskiest option. In his weekly Daily Telegraph column, Boris Johnson says the charter of fundamental rights is complicating efforts to tackle terrorism while moves to save the euro through further integration present an economic threat.

The London mayor writes: “It is the European court of justice, with its vast new remit over the charter of fundamental rights, that is making it harder month by month for the security services to get on with their job – whether it be expelling murderers or monitoring terrorist suspects. It is the border-free Europe, obviously, that makes it so much easier for our enemies to move around. As Ronald K Noble, the former head of Interpol, has said, the Schengen area is ‘like a sign welcoming terrorists to Europe’.”

The row over the exit negotiations came as the Scottish first minister, Nicola Sturgeon, urged both sides of the debate about Britain’s future in the EU to “aspire to higher ideals”, and “inspire people about the type of country that we want to be”, instead of stressing the economic risks of Brexit.



“For more than 40 years, membership of the European Union has been good for the prosperity and wellbeing of individuals, families and communities across the country,” she writes for the Guardian, ahead of a speech in Westminster setting out what she called the “positive vision” for remaining in the EU.

Sturgeon underlines the fact that EU membership is not just about free trade and open markets, but, “solidarity, social protection and mutual support”, adding: “By working together within the EU, we can achieve far more and make a real difference to some of the world’s most vulnerable people.”

Her intervention comes as some on the “remain” side of the argument are concerned about the lack of an upbeat message about the benefits of staying with the EU, rather than the risk and uncertainty of leaving.

She also suggests Cameron’s fraught renegotiation with his European partners may have diminished Britain in the eyes of other countries. “Two weeks ago, as European leaders were forced to break off from discussing the refugee crisis, one of the most pressing issues of our times, in order to negotiate the taper rate at which the UK can cut benefits for working EU citizens, I can’t have been the only person wondering whether the UK’s standing in the world was really being enhanced by that process.”

The first minister is expected to use Monday’s speech to underline her insistence that if Britain as a whole voted to leave the EU, in the face of a strong Scottish vote to remain, the SNP would seek to call a fresh independence referendum.