Tory rebels denounce what they see as an attempt to revive claim that extra money for health is one benefit of leaving the EU

It was a claim familiar to millions of voters in the June 2016 referendum on whether the UK should stay in the European Union. Emblazoned across the official Vote Leave battlebus was the suggestion that £350m this country sends to Brussels every week could be spent instead on our own National Health Service, if only we broke free and left the EU.

The figures, and the basic argument, were hotly contested at the time and have been widely ridiculed ever since. The idea that the UK would receive any Brexit dividend in the foreseeable future, to help fund public services, from an enterprise beset by so much economic risk was so dubious that even Ukip’s Nigel Farage disowned it.

Quick guide Is there a Brexit dividend? Show Hide What is a Brexit dividend? Britain contributes more money to the European Union than it takes out. Vote leave campaigners emphasised before the referendum that leaving the EU would free up these funds for the UK government to spend on vital infrastructure and austerity-hit services like the NHS. Is there a Brexit dividend? The Office for Budget Responsibility (OBR), which is the Treasury’s independent economic forecaster, has calculated that any benefit to the UK has all but disappeared in the past two years, largely due to a slowdown in the economy that it blames on the Brexit effect. What is the Brexit effect? Once it became clear to businesses and consumers that the government was split over how to negotiate Britain’s departure from the EU, creating huge uncertainty about the outcome, investment fell, productivity stagnated and consumer spending flatlined. This has forced the OBR and the other main forecaster, the Bank of England (BoE), to downgrade GDP growth this year and next year. The implied hit to the public finances is about £15bn a year by the early 2020s. Has all the dividend gone? Britain pays around £19bn into the EU pot each year, much of it coming back to the UK in the form of subsidies for farmers, research and development and infrastructure projects plus a £5bn rebate. This situation will continue during a transition deal, denying the government the Brexit dividend until 2020. What about after the transition period? The OBR said the UK’s £5bn rebate has already been “spent” ​on domestic priorities and cannot be spent again. The Institute for Fiscal Studies said in its assessment that the remaining £14bn could theoretically be redirected, but the government has already pledged to replace at least some EU spending (for example, farming subsidies) for some years, leaving an £8bn surplus. However, a reduction in GDP of just 1% translates to a fall in tax revenue of more than £8bn. How much has GDP growth fallen? The Bank of England said the trend rate of growth for the UK has fallen from around 2.5% to 1.5%, which matches the fall needed to wipe out the Brexit dividend. BoE governor Mark Carney said household incomes after adjusting for inflation were £900 lower than expected before the referendum vote. “Real household incomes are about £900 per household lower than we forecast in May of 2016, which is a lot of money,” he said, referring to the total lost growth for incomes in the two years since the 2016 referendum.

By Phillip Inman

Today, however, after a week in which she and her ministers survived a series of parliamentary votes on Brexit only by the skin of their teeth – and before one which promises even more trouble for the prime minister in parliament – Theresa May needs to boost the benefits of Brexit.

With this week’s parliamentary hurdles uppermost in their minds, ministers have officially bought into the idea that leaving the EU will be great for the NHS, helping to allow millions more in funding for hospitals every week, just as the official Vote Leave Brexit campaign said it would.

After days of argument between the chancellor, Philip Hammond, and the health secretary, Jeremy Hunt, over how much could be afforded and was needed (which some MPs believe has been played up by spin doctors to draw attention to the announcement), May reveals today that the NHS is to receive £20bn a year extra by 2023-24. Government sources insist that Brexit will indeed help the country afford the NHS’s big 70th birthday present.

While most MPs will be thrilled at getting more for their local hospitals, Conservative rebels campaigning for a soft Brexit smell a large rat.

It is truly pathetic. The availability of money for the NHS has nothing to do with Brexit at all Senior Tory MP

“It is sickening if this money is being in any way linked to Brexit,” said one senior Conservative MP among the rebel group who have been threatening to defeat the government over Brexit legislation in parliament.

“It is truly pathetic. The availability of money for the NHS has nothing to do with Brexit at all. If anything, Brexit makes us less able to fund the NHS because it hits the economy. And for them to suggest the reverse is truly shameful.”

Another Tory rebel added: “They will go to any lengths, even buying into the Boris Johnson lie that Brexit will be the saviour of the NHS.”

Health experts and health economists are primed and ready to cast fresh doubt on the idea that Brexit will somehow make us more able to afford a better-funded NHS.

On Saturday, as rumours of the supposed Brexit NHS boost circulated, Anita Charlesworth, director of research and economics at The Health Foundation, put out a pre-emptive tweet to counter the government spin: “In case talk of Brexit dividend comes up in discussion of NHS funding thought I’d retweet excellent @PJTheEconomist piece explaining in his wonderfully clear way why there is NO Brexit dividend. NHS needs extra funds but it’s taxes not Brexit that will have to pay for it.”

She provided a link to a piece by two senior figures at the Institute for Fiscal Studies who argue that “Brexit has reduced rather than increased the funds available for the NHS (and other public services), both in the short and long term”.

It is possible that the NHS announcement could go contrary to plan, and stir yet more resentment among the hardcore Tory Remainers as this week’s parliamentary clashes on Brexit approach.

Tory rebel MPs and peers are in no mood to take the spin lying down. They are already furious at tactics being used by the government and the whips as they attempt to bring them into line. They are outraged by what they say are campaigns of “personal vilification” being run by hard Brexiters and elements of the Brexit-backing press, which are trying to get them deselected.

Anna Soubry, the arch-Remain Tory, says hard Brexiters have been bombarding her constituency chairman and his office with emails demanding her deselection, and accusing her of being a traitor. “How do they get the chairman’s personal email?” she asks, adding that there appears to be a “concerted campaign” to bully MPs to vote against their beliefs. She says those sending the emails are not in her constituency, nor do they seem to be Conservatives, though she thinks someone has given people the addresses.

“It is a very serious matter for democracy,” says Soubry. She believes that some MPs will be swayed (although she insists she herself will not be) by such efforts to subvert the democratic process. “Many of them will simply not vote in the way that they want to vote, because they will worry about being deselected or their lives being made extremely difficult. It is appalling for our democracy.”

The government has split into contradicting power bases on Brexit Read more

Health experts and health economists are of like mind, and also pour scorn on the idea that Brexit will somehow make us more able to afford a better-funded NHS.

Some Conservative MPs also feel betrayed after May offered them a compromise deal on the “meaningful vote” on Brexit as the price for their loyalty last week, only for ministers to go back on the agreement. In these pages the former attorney general Dominic Grieve, who has been at the centre of the row, today suggests he will do his duty, come what may, to ensure parliament can play its part to avoid a “no-deal Brexit”, which he says would cause a “major crisis for our country”.

He adds: “In the absence of some agreement, the barriers to trade, commerce and movement would be such as to bring us to a complete halt.”

Tory peers look certain to help inflict defeat on the government on Monday over the meaningful vote. The matter will then be voted on in the Commons on Wednesday, in what could be the most critical test of May’s authority yet. However much she throws at the NHS in the meantime, it is far from certain that it will be enough.